Health Minister Steven Miles will announce changes are being made to the program in the wake of an auditor-general’s report. Picture: AAP image, John Gass
Health Minister Steven Miles will announce changes are being made to the program in the wake of an auditor-general’s report. Picture: AAP image, John Gass

Queensland government program in $256m cost blowout

A FORENSIC accounting firm has been engaged to delve into the Palaszczuk Government's digital hospital program to ensure the State is getting value for money, after a scathing report detailed cost blowouts.

Health Minister Steven Miles will today announce changes are being made to the program in the wake of an auditor-general's report which identified problems with the rollout.

The report found Queensland health did not do a thorough analysis of all the options available to it to implement the program.

It said that in the government's draft 2018 business case, the department was forecasting the total cost would increase by an additional $256.8 million to complete the implementation for hospitals - an increase of 42 per cent.

"Like any large system there's often room to learn and improve as you go and we will implement the report recommendations to ensure we continue to see positive results," Mr Miles said.

The Minister directed Queensland Health Director-General Michael Walsh to review the rollout in the wake of the auditor-general's probe.

Mr Walsh said he had "transitioned responsibility for the program's optimisation from our IT experts to the state's Chief Clinical Information Officer, Dr Keith McNeil".

A new committee will be set up to expand oversight of the project and Mr Walsh said QH had "commenced an independent assessment to confirm that, as per the contract, the prices being paid for the system were no less favourable than those being paid by other health service providers in Australia".

 

Queensland Health director-general Michael Walsh will review the rollout in the wake of the auditor-general’s probe. Picture: Justin Brierty
Queensland Health director-general Michael Walsh will review the rollout in the wake of the auditor-general’s probe. Picture: Justin Brierty

 

The report found the government failed to do a proper analysis of the options some stakeholders believe there has been favouritism shown to the successful vendor, Cerner, the report found.

"The analysis in the business case does not demonstrate a sufficiently critical examination of the alternatives," the report stated.

"The department engaged consultants to do a high-level analysis of costs and benefits of the three options without approaching the market.

"Due to the size of the state's investment in the program and the time that had passed since the original procurement process we had expected to see some evidence that the department engaged the market to determine what price other potential vendors would be willing to offer."

Concerns raised include that the vendor may seek to increase prices in the future because it is the only vendor.

"The department appears to have limited leverage when negotiating with the vendor when contract extension options are due," the report stated.

"This is because the vendor has the benefit of knowing that the department has not sought, and shows no indication of seeking, alternative ieMR options.

"As a result, the department cannot demonstrate that it continues to obtain the best price with the vendor to ensure the state is getting best value for money from the current arrangement."

Mr Miles said that the report had found the digital hospitals program was improving outcomes for patients.

"For instance, in Metro South the digital program contributed to a significant increase in early identification of deteriorating patients, as well as a decrease in emergency patient readmissions, less incidents linked to drug administration, monitoring, dispensing and supply and a significant drop in infections.

"This report further confirms that patients in our hospitals are already seeing benefits from the digital hospital program."

He said while the report found that costs of the implementation had exceeded initial expectations "it was often because hospitals had spent more money to go beyond the planned scope of their digital hospital, bought extra devices to increase utilisation of the system by doctors and nurses, and invested more resources to reduce disruption on patient flow when the new system was introduced".



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