Contracting News March/April 2005

GE Healthcare, Intermountain Health to create clinical software
GE Healthcare in Waukesha, Wis., and Salt Lake City’s Intermountain Health Care Inc. (IHC) are collaborating to create a best practices-based clinical software program that will enhance patient care processes in hospitals and clinics, and accelerate the adoption of electronic health records among health systems in the United States. GE and IHC team members will research and develop significant advances to GE’s Centricity software IT platform. The new best practices-based clinical software system will include IHC’s clinical decision-making abilities and will be based on current and emerging open healthcare standards. GE will provide Centricity technologies for departments in IHC institutions. These installations will continue until 2010.

Beth Israel takes over Waltham Hospital Cancer Center
Boston’s Beth Israel Deaconess Medical Center will take over operations of Waltham Hospital’s cancer care center in Waltham, Mass. Waltham was scheduled to close July 29, 2003, due to financial difficulties. Additionally, Waltham’s medical office will remain open and officials are exploring ways to provide urgent care services at its current facility. Before the takeover, Waltham sold its 18.5-acre campus and buildings for $8.5 million to a local real estate developer.

Consorta signs agreement with FedEx Kinkos
Schaumburg, Ill.-based Consorta signed a contract with FedEx Kinko’s, making its digital print and document finishing services available to Consorta members at discounted pricing. The agreement also offers discounts to employees of Consorta’s member facilities for personal copying needs.

Triad CFO recalled to military duty
Triad Hospitals Inc.in Plano, Texas, announced that CFO Burke Whitman, a reserve officer in the United States Marine Corps, was recalled to temporary active military duty in March 2005. Most likely, Whitman will be serving in Iraq and is expected to return to the company in the fourth quarter of 2005.
Triad anticipates no significant impact to its operations or performance in Whitman’s absence. Triad expects Whitman to remain involved in its strategic and other significant decisions through telephone and electronic communication, and other officers will conduct the company’s day-to-day business while he is away. During the absence, Triad plans for senior VP and controller W. Stephen Love to serve as acting CFO, and for chairman and CEO James D. Shelton and director of finance and investor relations Laura C. Baldwin to lead its investor relations activities.

Four Florida hospitals win VHA Southeast award
Four Florida hospitals won the Bright Ideas award from Tampa, Fla.-based VHA Southeast. The hospitals are: Lee Memorial Health System in Fort Myers, Fla; Baptist Health Care in Pensacola, Fla.; University Community Hospital in Tampa, Fla.; and Sarasota Memorial Hospital in Sarasota, Fla. The winners were recognized in six categories for efforts to improve financial and operational performance; introduce a new service; improve quality, safety and supply chain performance; or address key work force issues.

Sonoma Valley Hospital proposes $100 million hospital
Sonoma Valley Hospital in Sonoma, Calif., estimates that a proposed new 84-bed hospital will cost $100 million. The 150,000-square-foot hospital will replace the existing building and will have 54 acute-care beds and a 30-bed skilled nursing unit. Also on the drawing board are an emergency room, diagnostic imaging unit, surgery outpatient rehabilitation units, conference rooms and community education rooms. Administrators plan to fund construction with a general obligation bond, capital campaign and revenue bonds. Also on the hospital campus, but not part of the $100 million price tag, are physician offices and a community health center.

Amerinet signs new and renewed contracts
St. Louis, Mo.-based Amerinet Inc. signed a new agreement with Coloplast Corp.’s skin health division for skin care and hand-washing products. Effective immediately, Amerinet members have access to Coloplast’s complete line of skin cleansers, moisturizers, barriers, antifungals, patient bathing and infection-control products. Amerinet also signed an agreement for advanced wound care ostomy and continence care products from Hollister Inc.
An agreement was reached between Amerinet and Molnlycke for advanced wound-care dressings. Amerinet members will save on Tendra brand products, including hydrogels, alginates, foams, composite dressings, impregnated dressings and island dressings. The contract also includes SafeTec products, which reduce pain and trauma during dressing changes. The contract between Amerinet and Cardinal Health was renewed for 36 months for wound drainage products. Effective through December 2007, Amerinet members will save on Jackson-Pratt drains, t-tubes, reservoirs and wound evacuation kits.

McKenna selects Agfa RadWeb technology
McKenna Memorial Hospital in New Braunfels, Texas, plans to implement a community-wide digital solution from Agfa Corp. in Ridgefield, N.J., that will see its RadWeb technology from Evolved Digital Solutions in Brentwood, Tenn., implemented as part of an Agfa IMPAX integrated solution. RadWeb gives physicians and radiologists rapid and secure access to radiology images and reports via the Internet. McKenna intends to provide feature-rich PACS-RIS combined with an off-site archive that would ultimately deliver a more efficient and effective tool to its more than 250 referring physicians.

UCLA Healthcare cuts 400 jobs
Due to an unexpected increase in indigent care and cost overruns on construction of new hospitals in Westwood and Santa Monica, UCLA Healthcare in Los Angeles, Calif., will eliminate about 400 full-time positions, including some that are vacant and some that are filled. The move comes only months after it awarded bonuses totaling $343,000 to 13 health system executives despite the system’s failure to meet budget goals last year. UCLA Healthcare recorded $11.7 million in income above costs in fiscal year 2004, well below its budgeted goal of $30 million. Prior to this move, it projected income of $20 million for 2005.

Cardinal integrates medication management solutions
Dublin, Ohio-based Cardinal Health Inc. will be the first company to provide hospitals with an integrated, end-to-end medication management system linking all key clinical medication functions, including prescription, transcription, dispensing, distribution, administration, monitoring and surveillance. Cardinal spent the last six months bringing all of its businesses related to medication management under one organization. The company seeks to lower costs and improve workflow, productivity and patient safety by combining the capabilities of Alaris products, Pyxis products, pharmacy management, MediQual products, and clinical services and consulting.

HealthPartners to open new surgery center in St. Paul
HealthPartners Inc., headquartered in Minneapolis, will lease 31,000 square feet of space within a new 124,000-square-foot building under construction by the St. Paul Port Authority and Frauenshuh Companies. The space will house an outpatient surgery center with 10 operating rooms in 2006. The surgery center, designed for patient stays of less than 24 hours, is across the street from HealthPartners’ $22 million specialty care center, currently under construction and slated to open this October.

Lee Memorial Health suffers surgeon shortage
Fort Myers, Fla.-based Lee Memorial Health System’s surgeon shortage hit crisis level after four vascular surgeons resigned their privileges at Lee Memorial Hospital and HealthPark Medical Center, both located in Fort Myers on Feb. 1, 2005. The system has only half the required number of general and vascular surgeons to cover its two emergency departments. The shortage could have a negative financial impact on Lee Memorial if patients begin receiving care at its competitor, Southwest Florida Regional Hospital in Fort Myers.

Novation awards BSN medical three-year contract, signs agreement with GE Healthcare
Novation, located in Irving, Texas, awarded Charlotte, N.C.-based BSN medical Inc.’s orthopedics division with a three-year, dual-source contract, effective April 1, 2005. The agreement offers VHA and UHC members an opportunity to standardize to a selection of BSN medical orthopedics products through the members’ distributor of choice. Novation also awarded GE Healthcare, headquartered in Waukesha, Wis., a single-source contract to provide VHA and UHC with access to GE Healthcare’s injectable X-ray, MRI and ultrasound contrast media products, many of which are supplied under Novation’s private label brand, NOVAPLUS. The deal is effective April 1, 2005, through March 31, 2008.

Cleveland Clinic receives $17 million NIH grant
Cleveland Clinic Health System was awarded a five-year, $17.22 million grant from the National Institutes of Health (NIH) to advance its research on the science of heart attacks. The funding supports studies in the genetics of heart attacks, the genetics of atherosclerosis, the role of proteins in arterial disease, and the role of inflammation markers in the formation of coronary plaques. Eric J. Topol, M.D., chairman of the Department of Cardiovascular Medicine and chief academic officer of the Cleveland Clinic, will serve as grant program director.

Health First seeks state approval for Viera, Fla., hospital
Health First Inc., headquartered in Melbourne, Fla., is, for the second, time seeking state approval to build a new 100-bed hospital in Viera, Fla. The $59 million proposed hospital, to be named Viera Medical Center, is part of a $106 million medical complex planned on a 50-acre tract west of Interstate 95, which will include a medical office building and a fitness center. Health First’s application was turned down in June 2004 by the state, which said the new hospital would have an adverse impact on existing providers. A hearing was held with the Florida Agency for Health Care Administration on Nov. 30, 2004. The new facility would be the seventh acute-care hospital in Brevard County.

UHC names Cunningham Supply Chain VP
Oakbrook, Ill.-based University HealthSystem Consortium named John Cunningham as supply chain VP. He will work with UHC’s 90-member academic medical centers to achieve their supply chain optimization goals and oversee the critical areas of UHC service delivery, supply chain member services and custom contracting services. Cunningham comes to UHC from Atlanta’s Grady Health System, where he was VP for materials management.

Consorta awards three-year contract to Strong Value Group
Florida-based Strong Value Group has signed a three-year contract with Consorta Inc. to provide aycan x-ray print solution, a high-tech, cost-saving radiology image printing solution to its large hospital network. Strong Value Group is the authorized distributor of aycan medical systems and re-sells the system as Print Solution One. The aycan solution combines a high-resolution laser printer with an aycan DICOM print server to produce any kind of medical image on plain paper (up to 11 X 17 inches) at near-diagnostic image quality.

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