UI set to spend $100 million to upgrade IT systems at Chicago hospital

UI set to spend $100 million to upgrade IT systems at Chicago hospital

UI trustees will meet today in Urbana, with the public session starting at 9:30 a.m. at the Illini Union. Among the agenda items:

➜ Installation of Dr. Stuart King as trustee. One vacancy remains.

➜ Appointment of Avijit Ghosh as interim CFO and comptroller, at a salary of $393,247.

➜ Appointment of Steven Anderson as social work dean, at a salary of $265,000.

➜ A $33.5 million renovation of the Civil Engineering Hydrosystems Laboratory.

URBANA — At your last medical checkup, chances are the doctor pulled out a laptop or iPad to check your health history.

Electronic medical records are as important as stethoscopes these days, doctors say, and the University of Illinois is about to spend $100 million to upgrade and unify information-technology systems at its hospital in Chicago.

It's a precursor to another IT overhaul down the road, of the university's 2000-era "Banner" information system, which pulled together data on student academic records, financial aid and human resources. Planning for that is in the very early stages, officials said Wednesday, with no timeline yet, but the cost could approach the Chicago project.

The UI Hospital's goal is to simplify the billing process, give doctors and nurses faster access to patient records, improve patient care and allow the hospital to be more efficient — and thus save money.

But some UI trustees wonder if the investment will pay off in the long run.

The UI Hospital was one of the first to move to electronic medical records in 1997, but the 20-year-old system has been cobbled together and is in dire need of an upgrade, said Avijit Ghosh, until recently the hospital's chief executive officer and now interim chief financial officer for the university system.

The aging system also makes for inefficient care, and problems with the billing system makes it difficult to collect on patient accounts, he said.

A year-long study involving hundreds of hospital staff concluded that a new, integrated system was the way to go, he told UI trustees at a health systems committee meeting Wednesday.

The "3i" project team — for integrated information infrastructure — has recommended adopting a new system made by Epic, a major software provider for hospitals across the country, Ghosh said.

Trustees will vote today on a $62 million contract with Epic, payable over seven years. That includes software, ongoing technical support and remote hosting, which will save the UI money in hardware and labor costs, Ghosh said.

Implementation and operating costs absorbed by the university will push the overall price to around $101 million over 15 years, officials said, but some of that will be offset by savings in annual operating costs compared to the current system.

Currently, UI physicians and the hospital use different computer systems, so patients can't get a single bill for a hospital visit, a "source of great dissatisfaction," Ghosh said. The disparate systems prevent the hospital from getting the analytical information needed to improve the quality of care, he said. The new system should improve operations and patient satisfaction, and ultimately the hospital's bottom line, he said.

"This is not simply an IT project, it is a project to improve our work flow — the way we work, the way we code, the way we document things," he said.

Trustees were somewhat stunned by the cost of the project. Projections of the 15-year financial impact showed high up-front costs but net savings in operating costs of about $21.6 million.

Trustee Edward McMillan said he'd been involved in similar projects in the corporate sector that were much less expensive. He also worried that the estimated "payback" on the project, over nine years, was too long, given the life of these systems. He said it could be "obsolete before we ever get it paid back."

Ghosh said hospital systems are much larger and more complex than typical corporate It systems, and comparisons with other health centers and industry standards showed that the UI's projected costs were not atypical.

"The typical lifetime here is 20 years," Ghosh said. "Our system is so fragile now. If you asked me in the past what kept me up at night as the hospital CEO, it is the IT system."

At an earlier meeting, Trustee Don Edwards, who's been involved in IT installations at other hospitals, warned that these projects have a history of cost-overruns and delays. He also questioned some of the projected savings.

"I think that there is significant risk to this financial plan," Edwards said. "We don't know what's going to happen to health care over that period of time."

Ghosh acknowledged the concerns and the need for strong oversight on the project, calling it the most significant project for the hospital over the next five years.

It will be funded by hospital income, reserves, contributions from the physicians' group, and a $10 million internal loan from the university. Ghosh said the project includes a large contingency.

Acting hospital CEO Robert Barish, who is also vice chancellor for health affairs in Chicago, said a project team will monitor the installation to keep thing on track, with a 24-hour "war room" during implementation. The installation will be completed over two years, wrapping up in 2019, officials said.

If costs do rise, the hospital could scale back on some other projects planned over the next five years, Barish said.

"It feels like a staggering number," said new UI Trustee Stuart King of Champaign, an anesthesiologist, but it's what's required of hospitals today. "The (electronic) medical record has become as important as the stethoscope."

Meanwhile, the university has started setting aside money to plan for a successor to the Banner system, said Mike Bass, senior associate vice president and deputy comptroller.

Technology has changed dramatically since Banner was implemented in the early 2000s, before the days of the "cloud," he said. The rollout wasn't popular, with longtime employees complaining that the integrated system didn't suit each department's needs. But Bass said most of the complaints came at the beginning of the transition.

The UI is trying to determine what a replacement cost might be so it can begin planning, Bass said, though officials said that project is four or five years down the road.

"These things are not cheap," Bass said.