NHS strikes new deal with CSC for electronic patient records
Maybe US firm will make some profit now?
CSC and the Department of Health look to have concluded negotiations around the future of its Lorenzo system in the NHS.
A revised deal announced by CSC will see the US-based firm deliver additional implementations of the Lorenzo electronic patient records system beyond the 10 have already been rolled out, with "options for more where demand materialises".
It has not announced how many extra trusts will take Lorenzo, but according to CSC, they are expected to be named within six months.
The Health department has said that trusts will decide locally whether or not to adopt the Lorenzo system.
"The agreement we have negotiated gives choice to trusts about taking this software, rather than imposing the decision on NHS organisations. This is in line with the government's overall approach to the NHS," a spokesman for the department said.
CSC said it has signed a non-binding letter of intent with the department, under which the pair have agreed to a "set of high level principles" that are expected to become part of a binding framework before the end of the month.
"The letter of intent provides for an interim Lorenzo related standstill arrangement and contemplates that a mutual release of all accrued claims with respect to the Lorenzo deployments will be included as part of the interim agreement," CSC said in a filing made with the Securities and Exchange Commission (SEC) regarding the agreement.
In an SEC filing made late last year, CSC said it expected to have to write off $1.5bn as a result of its Lorenzo work, effectively leaving the company with no profit on the deal.
Should the agreement announced this week go ahead, that situation could change. "Based on the terms of the letter of intent, it is reasonably possible that the interim agreement and the amendment, if concluded, could result in a payment for the recovery of a portion of the amounts that have been written off as of December 30, 2011, and therefore could generate a gain," CSC's filing said.
CSC was contracted to deliver electronic patient record systems under the National Programme for IT. The Lorenzo software, developed by iSoft and later bought by CSC, was intended to be rolled out to trusts in the north, Midlands and east of England.
The Department of Health decided to renegotiate its contract with CSC last year, reducing the scope and value of the deal after the rollout of Lorenzo ran years behind schedule. However, the Health CIO at the time – Christine Connelly – warned that cancelling the contract could cost the NHS more than the £1.3bn value of the deal.
This article was originally published at Guardian Government Computing.
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