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Computer Venture is Launched; GE, IHC to Develop System to Prevent Medication Errors

Posted on: Thursday, 7 July 2005, 15:01 CDT

GE Healthcare and Intermountain Health Care, one of the pioneers in using information technology to improve health care, said Wednesday that they will jointly develop a computer system designed to prevent medication errors.

The project will be the first in a 10-year partnership announced earlier this year.

The partnership is one of the cornerstones in GE's push to increase its presence in the market for electronic health records in hospitals and clinics.

It will enable GE Healthcare, a unit of General Electric Co., to draw on IHC's expertise in the field. The health care system, based in Salt Lake City, began using computers to provide information to help doctors and nurses make decisions in the 1970s.

"They have gone farther in this area than probably anyone else in the country or the world," said Joyce Mitchell, chairman of the department of medical informatics at the University of Utah School of Medicine.

For its part, IHC gains a partner in its effort to develop a new generation of computer systems for its hospitals and clinics.

IHC, which had revenue of $2.7 billion last year, operates 21 hospitals and almost 100 clinics in Utah and southeastern Idaho.

As part of the agreement, GE Healthcare will set up a research and development center that will employ at least 80 engineers in Salt Lake City.

In addition, IHC will spend an estimated $100 million over the next 10 years on GE Healthcare equipment and information systems, including its Centricity electronic medical record system.

The technology underlying that product came from GE's acquisition of MedicaLogic for $32.5 million in 2002.

That system was designed for doctors' offices. GE Healthcare is a relative newcomer to the market for the larger systems designed for entire hospitals or even health care systems.

Its competitors in that market include Cerner Corp., McKesson Corp., Eclipsys Corp. and Siemens Medical Solutions.

But GE Healthcare, which has annual revenue of $14 billion, hopes to leverage it strong brand name and technology in imaging, medical diagnostics, patient-monitoring systems and other technologies to build a presence in the market.

GE Healthcare plans to work with IHC to develop information systems for specific departments and tasks within hospitals an approach that it describes as "modular, not monolithic."

"We are doing it in a slightly different way than our competitors," said Brandon Savage, medical director for GE Healthcare. "Hospitals may not be ready to replace everything at once."

The goal is for those systems to become the building blocks for a system that eventually could be sold to hospitals as a single product.

That GE is a relative newcomer to the market for hospital electronic health records was a plus to IHC.

Marc Probst, chief information officer, said IHC wanted to develop its own system, not buy one off the shelf. "We are bringing 30 years of decision support experience in health care," he said.

IHC also wanted a partner for the massive project. None of the established vendors, though, were willing to start from scratch in designing the new system.

IHC will receive a small royalty on products developed by the partnership.

The first project, scheduled to be completed in 12 to 18 months, will use bar code technology in a system to administer drugs. The system also will incorporate so-called decision-support software, which gives doctors information on potential adverse interactions with other drugs, allergies and even suggests drugs that might work better.

The project basically will add more functions to an existing GE Healthcare product for managing medications.

The market for electronic medical records is expected to boom in the next decade as the federal government, insurers and businesses pressure hospitals and doctors to part with their paper charts and records.

Several health-care systems in Wisconsin including Aurora Health Care, ThedaCare and the Marshfield Clinic already have installed systems for electronic medical records.

"There isn't a better time to be health care IT (information technology) than right now," said Eric Brown, an analyst with Forrester Research. "This is popping."

The health care industry has been talking about electronic medical records for decades, Brown noted. But now hospitals must move toward installing the needed systems to remain competitive.

"Not adopting it identifies you as a laggard," he said.

GE Healthcare's strategy of developing information systems for specific departments or tasks contrasts with the market's overall move toward systems that link every department, Brown said. But he disagreed with the contention that GE Healthcare is coming late to the party.

"This party is going to run all night and late into the morning," he said.

GE Healthcare's strength in information systems designed for specific departments, such as radiology, and in services should help it gain market share, Brown said. The company also is committed to the business.

"And that's what it is going to take in this business," he said, "because this is something that is going to transform and unfold over the next five to 10 years."

Copyright 2005, Journal Sentinel Inc. All rights reserved. (Note: This notice does not apply to those news items already copyrighted and received through wire services or other media.)

Source: Milwaukee Journal Sentinel

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