Cerner CEO: contracts are ‘onerous but not outrageous’

With the award of the first Local Service Provider (LSP) contracts due within a month, one of the firms that looks set to win significant contracts is US healthcare applications vendor Cerner. 

Uniquely the firm is either leading or a prominent member of consortia in all five clusters, and is strongly tipped to win at least one of the LSP contracts.  Some US financial analysts are currently tipping it to win at least two of the contracts. 

An early taste of success came earlier this month when Cerner’s core Millennium application was selected as the heart of the £64.5m national e-booking contract awarded to SchlumbergerSema in October.

But how do the senior executives of Cerner view their prospects and the NPfIT?  Interviewed at the opening of Cerner’s new London corporate HQ  Neal Patterson Chairman and CEO of Cerner said:  “We’re impressed with how fast the process is moving, and how organised it is.  There is a lot of work to do, but we’ve got a bunch of resources working on it.”

Glenn Tobin UK CEO of Cerner added that the centre has consistently met its deadlines or come extremely close. He stressed the dramatic change to previous lengthy NHS IT procurements. “I’ve personally been over here for three to four years and the pace is just mind-boggling, the momentum is continuing and not bogging down.”

Asked how the scale of the NPfIT procurements compared to contracts in the US and elsewhere, Tobin said:  “There is no question about it this is a major event in healthcare computing.”

Cerner’s CEO and chairman was even more emphatic:  “Frankly I don’t see it being replicated elsewhere in the next ten years. I think other countries will copy this, but this is so organised, so driven, so comprehensive that I don’t expect to see it again.”

He continued: “This is a once in a career, once in a lifetime opportunity to be involved in something that has a chance to transform a major country and how healthcare interacts with society in that country.”

Asked whether Cerner had implemented systems on a similar scale in the US, Patterson said that the company currently provided systems to major metropolitan healthcare networks covering millions of people. “But these are for a million, or a couple of million, here in England we’re talking about a programme dealing with 50m people.” 

He concluded: “Have we done it on this scale before, the answer is no, but nobody else has either.” 

Tobin, Cerner’s UK CEO, added that although the firm has yet to implement on the scale of an LSP cluster, it already operates data centres in the US dealing with similar volumes of transactions and data that will be required by an LSP.

And although the scale may be new, Patterson said the basic challenges set by the NPfIT were familiar.   “There is nothing that is being specced and being bid that we don’t do and haven’t done.  Because in the end this really is a bottom up implementation, and we do more of that than anybody in the world…  This is all very doable, just a lot of work.”

On the issue of terms and conditions being demanded by the NPfIT, Patterson commented: “They are onerous, but the people who are driving the programme are clearly really representing the country well.  We don’t find them outrageous, difficult and onerous yes, but their principles are good.” 

Questioned about the challenge to any LSP of moving from the centrally driven procurement phase of the NPfIT, into a genuinely bottom-up implementation, involving local clinicians and NHS organisations, Patterson became increasingly effusive, stressing the central role that change management will play in the success of the programme.

“No question, that is the battle, it is really not at the level of the hospital, it’s the doctor, the nurse, it’s the radiology technician, lab technician, the radiologist.  It’s one person at a time.  There is a lot of sociology to this.”

Asked whether it was a concern that they would not have full control over potential adoption risks if awarded a contract, Patterson said one of the oddities of healthcare in the US is that doctors never work for Cerner’s client.  “So we are so used to having our success [being measured as] a function of changing behaviour of people that don’t even work for our clients.” 

He added: “We are very respectful of this being a major business risk, but we’re anxious to approach the challenge.”

Speaking of Cerner’s experience of managing implementations Patterson said: “Our general experience is that physicians, nurses, radiologists and technicians realise that there is a great promise with information technology and that the work they do on a daily basis and the patients they serve can, and will be, significantly improved with really modern IT.

“There is always going to be apprehension with change, but I think this industry has a huge appetite to change.  Will it be easy? No, it will be very difficult.”

Asked about the keys to successful implementation, Patterson said that change management was a huge part of the programme.  As well as focusing on the individual clinician, change must come from the bottom up, “And the other one is that you really must have a compelling reason to change.

“To create change you really must have a compelling reason, and that is our job to go show, demonstrate and deliver a new medium for the clinical practice of medicine.  The old medium is basically a paper and pencil and your memory.”

Questioned on the benefits that he expected specific components of the NPfIT to deliver, Patterson said of e-booking.  “I think it has tremendous potential to change the relationship between the patient and the physician, and eliminating patient’s anxiety around not knowing when they will be seen.

“To make that part of the concurrent process, creating identification of the condition that necessitates referral to another physician, and to have that date when you leave the physician office, I think that is a major change that will benefit everyone in this country.”

Turning to the issue of the biggest benefit to the overall healthcare system, Patterson returned to his central theme of changing the medium for the practice of medicine.  “That basically means eliminating the paper.  Once you eliminate the paper that fundamentally allows people to rethink and transform how the work flows and processes work in healthcare.

“It is a simple idea with radical implications, and will challenge people in a number of ways who want to protect the information.  But at the end of the day clinical medicine is about humans that have medical conditions, who need the expertise and resources of the medical system, and the faster the elimination of delay, the identification of those conditions and their treatment the better.”

Cerner’s CEO concluded that IT had a fundamental role to play in eliminating delays and errors inadvertently created by today’s paper-based healthcare systems, together with better utilising the limited resources available to the NHS.  The grander over-arching aim is to do nothing less than fundamentally change the medium by which medicine is practised.