Doctors create company to oversee e-health system

The province’s doctors are venturing into new territory, setting up a private company that will oversee part of New Brunswick’s long-anticipated e-health system.

The New Brunswick Medical Society is the majority owner of a new for-profit company, Velante, which it established to run an Electronic Medical Record (EMR) system for doctors’ offices.

The EMR will be one part of the wider e-health system that provincial governments have been promising for five years.

Dr. Ben Hoyt, an ear, nose and throat specialist, already uses a basic electronic patient record system within his own office. He says the health system will be more efficient once his office computers can communicate with hospitals and family doctors’ offices.

"Every day that a patient has to wait is a day that they could be treated," he says.

"So we’d like to see referrals move instantly rather than take a couple of days. We’d like to see test results come back instantly, rather than take a couple of days."

The EMR system being put in place by the medical society is a separate component from the One Patient, One Record system created by the Department of Health. The latter system will manage records of patients who deal with provincial institutions, such as hospitals. Those records could include X-ray results and MRI scans.

The EMR, on the other hand, will record patient visits to their family doctors or specialists. Once both systems are running and are communicating with each other, specialists will be able to get hospital test results quicker, and family doctors will be able to view the information for follow-up care.

"The diagnostic process has many steps, and if you have a few days added in each of those steps for paper to move from one end to the other, that adds up over time," Hoyt says.

"If everything moves seamlessly through an electronic medium, the patient is better off."

Velante recently awarded the EMR contract to Intrahealth, a New Zealand company. The medical society hopes to have 500 of the province’s 1,600 doctors to install Intrahealth’s EMR system by the end of this year. Each doctor will pay $8,000, about one-third of the total cost.

The New Brunswick Medical Society owns 51 per cent of Velante. The other 49 per cent is owned by Accreon, a Fredericton-based IT consulting company that did work on the One Patient, One Record system for the Department of Health.

Questions about consultants

Last year, Auditor General Kim MacPherson questioned the way contracts were awarded in the department. She said there were problems with 57 of 289 contracts worth a total of $108 million.

"We believe the use of consultants was significantly more costly to the province than had this work been completed by department staff," MacPherson wrote.

She also said consultants from Accreon brought in as project managers ended up in potential conflicts of interest, because they oversaw contracts awarded to both their own company — raising the possibility they could be extended or expanded.

She also raised a concern that project managers had access to information from their competitors, giving them an advantage.

MacPherson’s report followed an audit by the Office of the Comptroller in 2010 that first identified the concerns. At the time, Accreon refused interview requests, although Neil Russon, the company’s chief executive officer, said in a statement the company always follows the processes established by its customers.

The Department of Health tightened its rules on contracting and consultants following the audits. Many of the questions raised by MacPherson involved consultants other than Accreon.

The medical society says its EMR project through Velante is different than the One Patient One Record initiative.

"I think it’s really apples and oranges when you start to make that comparison," says Anthony Knight, chief executive officer of the medical society, calling the EMR "distinct" from what Accreon worked on at the Department of Health.

Accreon will not be bidding on any of the EMR work it co-manages because patient-record systems are not among the products it offers, he said.

"Velante has been following the same procurement standards set by the province of New Brunswick, and the procurement’s been monitored by the province of New Brunswick to ensure our approach is that which is provided for in legislation," Knight says.

The auditor general declined to comment on the establishment of Velante. MacPherson said last week she was not aware of it or of its role in the e-health system.

Long-standing advisor or unnecessary middle-man?

Andrew MacLean, a medical society spokesperson, says Accreon was chosen as a partner in Velante because it’s "a long-standing technology advisor" to the society.

"You need somebody with that technical understanding and insight to guide you and assist you," Knight says.

Although Velante is incorporated as a for-profit company, MacLean says it’s unlikely to do more that break even.

Accreon’s profit from its 49-per-cent share, he said, will come from "gaining a credible stake in the intellectual property associated with the creation of Velante, which they can then market to others as IT-related professional services in the future."

Some other health IT companies are looking warily at how Velante has been set up.

Stephen Alexander, the chief financial officer of Saint John-based ClinicServer, says including a "middle-man" in the arrangement — Accreon — could make the EMR system more expensive.

Alexander says normally, the company hired to provide the application would also be responsible for making it interact with other parts of the e-health system. By having Accreon do that, he says, everything becomes more complicated.

"Whenever you see additional steps being put in that add complexity, it probably increases cost and it probably increases the amount of time it takes to bring a solution into play," he says.

'Not to be critical of government, but sometimes government can slow things down and limit innovation.' —Anthony Knight, New Brunswick Medical Society

"Certainly there’s a lot of things [in the arrangement] that look similar to what has been tried in other jurisdictions in North America, and universally they have failed. They failed because of the complexity that was introduced and the number of layers that were introduced."

The higher cost will be passed on to doctors, Alexander predicts, and that means fewer of them will adopt the system.

And that in turn will make it harder to use data in the EMR system for epidemiological goals—such as spotting the outbreak of a particular disease that may first show up in statistics gathered from individual physician records.

As it is, the medical society expects about one-third of doctors to sign on this year. It’ll take "a number of years" to get full enrolment, he says.

"That’s legitimate. Physicians are independent and able to make their own decisions about how they manage their practices."

Alexander’s company had been interested in bidding on the New Brunswick EMR, but he says the company saw the request for proposals too late because it was under the Velante name, not the medical society’s and because it was posted to the MERX site for federal tenders, not the province’s.

Alexander says that his criticisms are not sour grapes, because his company is expanding its business globally and didn’t need the medical society contract.

Rather, he says, the company was interested because he felt it might be able to save the health-care system some money. His comments now are motivated by his concern that the medical society is going about the project in the wrong way.

"The advice they received does not seem to be the best advice they could have received," he says.

Alexander also believes the entire e-health initiative in New Brunswick got it backwards. He says the province should have started with the doctors, not the department, because they’re the hub of the system.

While not all records in a doctor’s office need to be transferred to a hospital, he notes, any hospital records about a patient have to be available to that patient’s doctor—making the doctor’s office the logical building block for the system.

Knight says he expects the first doctors to start using the EMR this spring.

"Not to be critical of government, but sometimes government can slow things down and limit innovation," he says.

"That’s the real beauty of our model. We have doctors who maybe are a little impatient, and want to see things done quickly and effectively, preserving good transparency and good accountability but at the same time having a laser-like focus on getting the job done and not being distracted but politics or the mandate or issue of the day.

"That’s why the doctors wanted their medical association to take leadership on this, and that’s why we have."