Childrens hospital hopes for savings with IBM contract; five-year deal concludes transition to in-house management.CHILDRENS Hospital Los Angeles Los Angeles (lôs ăn`jələs, lŏs, ăn`jəlēz'), city (1990 pop. 3,485,398), seat of Los Angeles co., S Calif.; inc. 1850. has signed a five-year, $13 million contract with IBM (International Business Machines Corporation, Armonk, NY, www.ibm.com) The world's largest computer company. IBM's product lines include the S/390 mainframes (zSeries), AS/400 midrange business systems (iSeries), RS/6000 workstations and servers (pSeries), Intel-based servers (xSeries) to manage and support the hospital's financial, human resources The fancy word for "people." The human resources department within an organization, years ago known as the "personnel department," manages the administrative aspects of the employees. , materials management Materials management is the branch of logistics that deals with the tangible components of a supply chain. Specifically, this covers the acquisition of spare parts and replacements, quality control of purchasing and ordering such parts, and the standards involved in ordering, and grants-tracking systems. The contract completes the hospital's transition from outsourcing its information technology support to a single vendor and instead using multiple vendors, each a specialist in their fields: IBM will provide outsourced services in Canada and at the hospital for the PeopleSoft applications that manage medical supplies, inventory, general ledger General Ledger A company's accounting records. This formal ledger contains all the financial accounts and statements of a business. Notes: The ledger uses two columns: one records debits, the other has offsetting credits. , accounts payable, purchasing, budgetary controls, asset management, payroll and benefits. "We were looking for Looking for In the context of general equities, this describing a buy interest in which a dealer is asked to offer stock, often involving a capital commitment. Antithesis of in touch with. a more nimble, best-in-breed vendor relationship," said Rod Hanners, the hospital's chief operating officer Chief Operating Officer (COO) The officer of a firm responsible for day-to-day management, usually the president or an executive vice-president. . He noted that another company, Cerner Corp., supports the hospital's in-patient medical records systems. The hospital is hoping to save $2 million to $3 million, Hanners said, around 10 percent of its IT operating budget, with the vendor changes. For IBM, the contract is its first outsourcing support agreement with a California hospital and a significant step toward beefing up its healthcare industry practice. The company last year acquired Healthlink Inc., a respected healthcare consulting group in Houston, and Corio, a Silicon Valley-based application hosting services company that specializes in medium-sized companies. The company already provides consulting services to some area hospitals, including Cedars-Sinai Medical Center Cedars-Sinai Medical Center is a world-renowned hospital located in Los Angeles, California. History Cedars-Sinai is the result of a merger in 1961 between two major Los Angeles hospitals, Cedars of Lebanon and Mount Sinai Home for the Incurables, with Steve Broidy as . Most of IBM healthcare contracts in the state have been with managed care companies, such as Blue Cross of California parent WellPoint Inc. "IBM has been on a tear both in outsourcing and targeting the healthcare market," said Jim Jacobson, health care industry attorney and partner at the Holland & Knight law firm. Hospitals traditionally kept their IT services in-house with the rationale that their applications were too complex and specialized to outsource. That has changed as facilities migrated to using more industry standard software such as PeopleSoft's. "Hospitals are realizing that their core competency is the care of patients, and to the extent that they can offload things to people who do that routinely, they can achieve better reliability and service for their clinicians at a reasonable cost," said Dana Sellers, a healthcare industry consultant for IBM Global Business Services. |
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