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EDI brings improved purchasing procedures to health care industry.

Electronic Data Interchange has proven its worth in the transportation, retail, and other industries, and is now making inroads in the health care industry.

A Canadian venture is connecting hospitals and their trading partners, while in the U.S., Baxter Healthcare, a leader in its market, has been recognized as an early innovator in applied use of EDI.

The Canadian effort to improve the purchasing procedures among Ontario health care providers keys on EDI.

CareNET Services is a government-initiated venture. Its first goal is to link all hospitals and their trading partners, and eventually expand that network to nursing homes, labs, pharmacies, and related health care providers.

So far, more than 20 hospitals and 25 suppliers are linked.

Health care providers in Canada have been under great pressure to use their funds as effectively as possible. Besides taking advantage of EDI technology to save money and time, the venture set out to conform to the EDI standard increasingly being implemented in health care.

"We needed an EDI solution that was competitively priced and complied with ANSI X12 standards and subset HIBCC (Health Industry Business Communications Council) standards," explains Rob MacLeod, chairman of CareNET.

Also, MacLeod said, the venture was looking for security, ease of use, and the ability to migrate to an integrated solution to link to internal applications within the hospital.

A pilot program was a big success, reducing the number of purchase order errors. It used Harbinger's InTouch*EDI software running on MS/DOSPCs, without the need for a dedicated computer.

Transact Data Services (TDSI) is the value-added network providing the EDI service. TDSI licensed Harbinger*EDI network software.

Containing costs

Baxter Healthcare is furthering its Electronic Data Interchange initiative as it works to reduce costs and remain dominant in its marketplace.

The company, known for being an early innovator in applied use of EDI, has more than $8 billion in annual revenues. It develops, manufacturers, and distributes more than 120,000 products to health care providers, commanding more than 20% of the market.

"Cost control is a critical issue in the health care industry," says Neal Ebert, section manager of EDI for Baxter.

"Our EDI project is a major component in our program to reduce our costs, as well as the costs facing our customers."

Baxter settled on the mainframe software product Trading Partner from TSI International as the single EDI management system to support all Baxter divisions and locations. The company sought a system which allowed non-technical staffers to add business partners and transactions quickly and which integrated EDI data into existing and planned applications systems, without applications or systems programming.

"Part of our pre-selection process was to observe what other companies of our size and general requirement level had done and were doing," says Ebert.

"What we recognized early on was that most companies seemed to be involved in a perpetual pilot program. They were constantly involved in implementing the latest and greatest version of a system that obviously hadn't been designed to accommodate much movement."

With Baxter's just-in-time stocking program to a target market of 6700 hospitals and other medical facilities Ebert adds, "it is simply unacceptable that a situation might arise where a hospital needs stock, and they hear that we will accept their order just as soon as we get a new transaction set running."

The company has a variety of connections to its customers and vendors. Besides using such value-added networks as IBM, GE Information Services, and Harbinger, Baxter has numerous customers on-line with direct connections.
COPYRIGHT 1991 Nelson Publishing
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Title Annotation:electronic data interchange
Publication:Communications News
Date:Aug 1, 1991
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