Royal Free says £7.2m deficit due to Cerner

Tags: BT Cerner CRS London Millennium Quality Royal Free

05 Nov 2008

The Royal Free Hampstead NHS Trust has reported a £7.2 m deficit due mainly to problems with the Cerner Millennium Care Records System installed by BT under the NHS National Programme for IT.

The trust had a loss of £3.2m in the last three months alone, attributed to severe ongoing problems with the CRS system installed in June. Royal Free was the first organisation to take the London cluster version of Millennium.

Implementation costs have been far higher than planned, and problems with the system have left the trust without reliable data. This has led to under-utilisation of key resources such as theatre time, resulting in reduced levels of activity and clinical efficiency leading to lower income.

Board papers say that of the £7.2m losses, lost activity accounts for £1.3m, potentially correctable data entry £3.789m – of which £2m is at risk unless required software fixes are delivered on time, and additional staffing costs of £1.2m. A Royal Free spokesperson said the losses represented about 6% of the trust’s total budget.

November trust board papers state: “The committee was informed that the majority of the adverse variance to budget was due to the implementation of Cerner. The shortfall comprises a number of issues where costs and losses have been incurred over the implementation plan.”

The financial problems experienced by the Royal Free appear to closely mirror those reported at Barts and the London. In September E-Health Insider reported the trust was projecting a £3m shortfall in income this year due to the data problems.

In August the Royal Free initially reported that the deployment of the London Millennium CRS software had proved “demanding”, with delays in some of its busiest clinics. But, overall, said implementation had gone well.

The new board papers, however, lay bare the issues the trust has been struggling with since implementation. Problems that have led to increased implementation costs, data issues, reliability, reduced levels of clinical efficiency and reporting problems leading to financial deficit.

Extra staff had to be recruited to fix problems with data entry and reliability “to maintain normal activity levels”. Reliability is also reported as a problem: “Issues with the stability of the system and the clunky workflows causing the previous levels of clinical efficiency to fall…”

The report also reports, “Activity shortfalls attributable to the system not supporting the trust in managing the patient pathway, meaning many clinic and admission slots were not used (lost activity)”.

The paper adds: “Data entered on the system incorrectly or not entered at all, in part due to the clunky workflows and, in part, to the lack of experience of our staff in using the actual Royal Free build, as the system supplied was different to the system supplied for training, and there were no operating or procedure manuals for the system.”

Unsurprisingly the paper reports the situation “has resulted in a great deal of uncertainty surrounding the potential full year outcome for the trust”. It says that most performance measures showed good performance by the trust “but a significant number of patients are approaching the 18 week target.”

“Arrangements are being put in place to ensure that this target is achieved, although uncertainties about the quality of data within the Cerner system hampers some of the detailed operational arrangements that have underpinned the trust’s previous success.”

Asked whether the losses were under control or expected to continue, the trust spokesperson told E-Health Insider: “We expect some degree of losses to continue, although not at the rate which affected Quarter 2, while we work to resolve issues with the system. The extent of these losses still needs to be identified.”

A spokesperson for BT, the local service provider for London, said: We cannot comment on the finances of individual NHS trusts. However, some additional costs are to be expected when implementing a system in an environment as complex as a large London teaching hospital.

“The NHS London Programme for IT, BT and Cerner are working together with the trust to quickly resolve outstanding issues. Progress is beginning to be made in identifying much of the missing activity and steps are being taken to recover the costs related to data entry problems. All parties are working hard to minimise the impact of these issues.”

Jon Hoeksma

Readers Comments

NPfIT do not learn lessons

05 Nov 08 16:26

These comments from Royal Free look so familiar to me! They resembe comments made in our Trust over the last 2 years, and look familiar from other Trusts' reports.

So how come the same mistakes are made time and time again?

How come those in charge of CfH and NPfIT have not listened and learned and changed. The comment about the traning package being different from the installed package is so true and so much nonesense?

Should someone be accountable for such poor management?

Whatever happened to PRINCE2? Did no one send a copy to NPfIT and CfH, and suggest maybe that one member of staff get trained?

In a Commercial World

05 Nov 08 16:34

Now if M&S put in a new sales and supplies package and it increased costs and reduced income - how many more stores would it roll out into? Would the board accept "It is a complex environment"?

it would not go into one more store - if it did the share price would plummet and BHS would be smiling?

In a Commercial World the contract would have been set properly and the supplier sacked and sued by now ... but I believe we have never seen the contract for CRS?

This is the working persons' National Insurance contributions being spent on systems that cost more and therefore leave less for patient care.

......and?

05 Nov 08 17:09

......and would CfH like to comment please?

Is the taxpayer carrying this burden as well as the cost of the whole program ?

05 Nov 08 19:58

We understand that the NPfIT contracts are "tight", so presumably these costs will be recovered from the culpable parties. If not, this looks like a programme for which the costs may ultimately run to many billions more than the £21bn we have heard about for the last 5 years. Is it really worth it ?

Euphemisms

06 Nov 08 09:55

“Activity shortfalls attributable to the system not supporting the trust in managing the patient pathway, meaning many clinic and admission slots were not used (lost activity)”.

No, it's not "lost activity", it's real people having unnecessary suffering and death.

Royal Free in disarray

06 Nov 08 17:02

Isn't it time for CfH to recognise this is a program in deep trouble? Not only are we failing our staff but the patients are also at risk. It's time to review the whole approach and I welocme and look forward to the new CIO's clarity by Xmas......

Real people suffering

07 Nov 08 09:37

Yes - it is real people suffering. People who have had appointments cancelled repeatedly. People who arrive at clinics clutching their appointment letter only to be told they do not have an appointment and being sent away hoping to receive another appointment in the post because the system won't allow the clinic clerk to make another one. People who because their care has been delayed have deteriorated.

Who allowed these systems to be deployed and implemented? What is being done to prevent this reckless lack of consideration of the real person? Who is taking the blame?

CFH must give answers and perhaps 'heads should roll'.

Whose fault - Royal Free of Course

07 Nov 08 11:02

IMHO whoever made the decision to go-live with Cerner at the Royal Free should consider their position. They have clearly failed to ensure that a proper process of testing the product has taken place and have allowed patient care and organisational performance to suffer as a consquence. It is not the supplier that makes the decision to switch on the new system - it is the NHS organisation concerned.

Given that these issues are not exactly new - the decision to cutover to the new system is even more flawed - there are no excuses.

To then blame Cerner for your inadequate testing/decision making is even more bizarre. How this contrasts with Morcombe Bay who have demonstrated how you should manage and control the implementation of such important systems.

And Cerner is perfect ? Er don't think so

09 Nov 08 18:02

Comment 8 puts all the blame on the staff at the Royal Free. I don't work in London, but I very much doubt that they had free reign on how to deploy Cerner. Certainly in the South, the supposed experts from the LSP told us it had to be big-bang, and with rigid Cluster wide rules super-imposed on an aged, but potentially flexible, American system, the outcome of very poor fit was in my view inevitable.

The whole premis of NPfIT was that the cost of software was 'free' to hospitals, the hardware and networking was not their problem, and all that they had to do was implement. That the extra processes invovled, and lack of influence over product and roll-out make deployment far more difficult, and operational use far less efficient seems to have escaped your correspondent. And I doubt the hospital had a free hand to just say 'No, this system is no good'

I have looked in some detail at Cerner. I am sure that the clincial system used real-time could be quite good. A lack of flexibility or perhaps awareness by Cerner, and a lack of understanding of NHS processes by the LSPs has been a problem, especially around the NHS data model. The reporting is I hear rather difficult, since the model and basis of storage is based on such a fundamentally different basis.

The learning should have been on all sides, and cannot be laid entirely at the hospital's door. No-one seems to have been capable to say "STOP", and they all should have.

Deficit

10 Nov 08 09:18

If the Royal Free really do have a £7.2m deficit due to the Cerner system (assuming it's not just a convenient excuse for bad financial mgt) then there needs to be accountability across the board.

To apportion the blame to any single party is a perfect demonstration of the isolated thinking within the NHS and why so many projects fail.

Comment 8

10 Nov 08 16:23

I did not blame staff at the Royal Free for Cerner - I blamed the decision makers in the Royal Free who decided to go-live with Cerner. Ultimately - the decision to cutover to Cerner is the responsibility of the Trust and the Trust alone.

When I was involved with Cerner implementation in my Trust, I ensured that we tested everything, timed as is and as would be processes, reporting etc etc. On this basis we never got to a position where we faced an imminent go-live date given the large number of product/process defects encountered.

I was absolutly clear, along with other project board members, that a decision to switch to Cerner could only be made when we were 100% certain that we could maintain business as usual and that the short to medium term benefits would outweigh any additional admin staff costs. We were not being brave with our then LSP and CfH - but making sure we were in conrol and in line with DOH guidance - see http://tinyurl.com/5cgvb8.

Given the evidence that not all is well with the current version of Cerner in other smaller deployments - why oh why have the Royal Free walked into the go-live with their eyes shut and not having 100 % ensured that they could maintain business during and after go-live.

Is Cerner perfect - hell no - but that is not the point - I just can't beleive NHS Trust decision making and then blame the product excuses - when the real issue is that they should never have switched it on unless they were 100% sure it would not affect patient care or Trust performance.

CfH and DH Pressures

11 Nov 08 20:53

Our Trust was put under immense pressure to accept CERNER - fines or penalty clauses of £20,000 a week were talked of - we were told our old PAS would not be able to generate income etc. Eventually the Trust gave way and allowed go live. You have already run stories of the increased cost, decreased efficiency on our Trust, and now in the Royal Free. Our Hospital Consultant Committee was allowed to inform the MD and IT leads at future go-live Trusts of the deleterious and costly effects of CERNER RO. One Trust has since chosen not to go live, and 2 London Trusts have gone live - one was confident that the London CERNER software was far superior to the version in our Trust. I personally had previously written to the CMO of NHS England in Autumn 2006 warning him of a national "clinical risk" if CERNER R0 like CRS were rolled out across England. Sadly I have been proven right.

So the DH and CfH are responsible as well - they drew up and agreed the specifications and contracts, and likely under intense political pressure put immense pressure on Trusts to "go live".

The only time I ever seemed to have an impact was when I asked what had happened to PRINCE 2 methodology principles in CfH and CERNER FUJITSU.

Understanding Requirements & Traceability

12 Nov 08 04:30

The problems with all these implementations is the fundamental lack of understanding of requirements, functional specifications and detailed design, and how the specifications must be traced between each other, and then with test case planning and execution. It is only through this process that a measure of quality can be obtained. Oh, the specifications usually don't exist, and everyone works from workflow diagrams that should only contribute to the specifications. This way no one understands the requirements, not even the customer, who one would expect must understand them.

However, most electronic health record vendors peddle their software as off-the-shelf and already tested, thus, the correct process of verification and validation is unnecessary. The crazy attitude amongst customers is they actually believe the garbage.

When someone tells you that a period of stabilisation exists instead of an 'acceptance' period, then you better expect major problems. Stabilisation periods are another way of telling you that it's more important to the vendor and customer to get the system 'live' than is patient safety or billing and revenue collection. Plus, if no one understands the requirements, then defect repairs can be charged to the customer because an agreed specification doesn't exist.

No accountability - sounds like a good way to make some money to me!