DAOU lands $7 million contract; builds computer network spanning five Midwest states.

SAN DIEGO--(BUSINESS WIRE)--Feb. 21, 1996--DAOU Systems Inc. has been awarded a $7 million contract from Mercy Health Services Iowa to design the health care industry's largest private computer network.

When completed, the system will span five Midwest states, linking 81 facilities, 690 physicians and 68,000 inpatients annually. The project represents the health care industry's first interstate network, connecting more than 2,000 workstations at hospitals and clinics throughout Iowa, as well as several locations in Nebraska, South Dakota and Illinois. Future plans call for expansion of the network into Wisconsin.

The project places Mercy Health Services at the forefront of cutting-edge technology.

"We've created our own health care Internet," said Mike Mote, vice president of Information and Technology Management for the Iowa Region of Mercy Health Services. "The benefits are tremendous. It will clearly facilitate improvement in the quality of care as well as access to care for our patients. We'll have quick distribution of lab and radiology reports.

"The system will help minimize the number of duplicate tests. Physicians will have quicker access to more information. They'll be able to make more informed diagnoses and easier patient referrals. They'll also be able to communicate easier with their peers throughout the system."

In addition, Mote said MHS will use the system to develop the basis for electronic medical records, enabling patients to visit any of the facilities in the network without playing the tedious, time-consuming game of "64 questions."

"Most importantly," Mote added, "we're being proactive. There's uncertainty as to where health care reform is headed, especially as it relates to the changes that payors and employers are forcing. This network gives us a solid platform from which we can increase efficiency, cut costs, anticipate change and build for the future."

And the future is bright for such networks and services, said DAOU President Daniel Daou. "This network will make it easy for Mercy Health Services to take advantage of future technologies such as ATM (asynchronous transfer modes.) These technologies will merge voice, video and data, making telemedicine a reality in the very near future.

"Organizations like Mercy Health Services will be able to develop bold new services and markets. It will radically change the face of health care."

Founded in 1987, DAOU Systems has established itself as a leader in the design, implementation, support and management of computer networks for the health care industry. The company also offers telemedicine and on-line Internet services.

DAOU is among the fastest-growing companies in the health care information systems industry. The firm provides service to more than 350 hospitals and health care facilities nationwide. With headquarters in San Diego, DAOU has 10 regional offices and more than 100 employees.

Its clients include such large and prestigious organizations as Stanford Health Services, Mercy Health Services, Palomar-Pomerado Healthcare and Iowa Health Systems.

CONTACT: DAOU Systems Inc., San Diego

Craig K. Collins, 619/452-2221, Ext. 2450

E-mail: [e-mail]