GE Healthcare Acquires Agility Healthcare
A unit of GE Healthcare’s global Diagnostic Imaging Services business acquired Agility Healthcare Solutions today for an undisclosed sum. This is the same group that did the deal with Anywhere several years ago, and most recently signed a distribution deal with CenTrak, which was announced at HIMSS 2008 (press release).
What started as a straight on asset management strategy has grown in scope.
“Any hospital administrator knows about the daily headaches caused by the logistical coordination of providing patient care. For each and every patient interaction, patient, clinician, staff, space, assets & supplies must come together at the same time. Agility’s visualization system is the one tool we’ve found that lets us visualize these interactions to predict and prevent bottlenecks before they occur,” said Jeffrey Burke, Vice President and Regional Chief Information Officer, Bon Secours Health System.
The RTLS (real time location system) market’s initial focus was asset management. The industry consensus at the time was that asset management was easy to understand and had an attractive ROI – most hospitals lease some of their equipment that ends up poorly utilized due to hoarding and misplacing equipment. An RTLS can significantly reduce the amount of equipment leased through increased visibility and thus, utilization. Sadly, the hospital market was not sufficiently compelled to adopt this application (regardless of the ROI) at the rate that entrepreneurs and venture capitalists expected.
The founders at Agility, being software guys from McKesson, started with software. After some initial experience in the market they decided to stick with software and resell whatever infrastructure best suited their customer’s application. And the applications the market pulled them to are the kinds of things Bon Secours is doing.
Cardinal to Spin Off Medical Device Business
According to Modern Healthcare’s daily IT e-newsletter today, Cardinal Health announced it will, “spin off its clinical and medical products business into a separate, publicly traded company.”
In what looks like a tussle between Cardinal’s traditional supply chain services business and the young upstart CTS (clinical technologies and services) the two groups have decided to go their own way. With the retirement of Cardinal chair and CEO, Kerry Clark, the two vice chairs, George Barrett for supply chain services and David Schlotterbeck for CTS, are going separate ways. Barrett will take Clark’s position and Schlotterbeck will head the $4 billion global company to be headquartered in San Diego.
The new business’ offerings will include product lines in the areas of infusion care, medical and supply dispensing, respiratory care, infection prevention, diagnostics and surgical procedures.
The press reports the spin off is intended to deliver more stockholder value than the current company.
Analysts said the spinoff would allow a slimmed-down Cardinal Health to focus on turning around its underperforming drug distribution business, while potentially attracting a higher stock valuation for the publicly traded stand-alone med-tech company.
“The clinical technology side is really the crown jewel,” said Jeff Jonas, portfolio manager at Gabelli Health and Wellness Trust Mutual Fund, which owns Cardinal shares. “So that would presumably get a much higher multiple in the market as a stand-alone company.”
Apparently, declining revenue growth in the supply chain business is holding down the full valuation of CTS. The spinoff’s stock price should reflect the full value of the higher margin medical device business.
First Connectivity Cover Story in Leading HIT Mag
Connectologists rejoyced this month (September, 2008) when Healthcare Informatics magazine published Biomed Joins the Party – Savvy CIOs are considering biomedical devices in their overall strategic plans (link). To my knowledge, this is the very first cover story in a major health care IT magazine about medical device connectivity. As an aside, diagnostic imaging pubs have been writing about connectivity in their market for many years.
Contributing editor, Mark Hagland, casts the drama that is connectivity as “two worlds colliding,” – the worlds of IT and biomedical engineering. He builds his story around the integration of medical devices to support EMR charting. In fact, medical device connectivity started almost 20 years ago with the integration of Apple IIs and IBM PCs (not to mention a few funky HP mini computers) in diagnostic areas like the cath lab and in the ICU. Probably the biggest wave of connectivity to date has been PACS (picture archiving and communications systems) and the adoption of DICOM. Now the health care industry is zeroing in on connectivity at the point of care with patient monitors, smart infusion pumps, point of care testing, and yes, EMR integration (by far the most expensive point of care application).
Using Trinity Health as his template, Hagland describes an ideal approach to medical device connectivity: the involvement of IT, clinicians, and biomedical engineering. The 40 odd hospitals in Trinity’s system have over 110,000 medical devices. Trinity has used this approach to more effectively manage these colliding worlds:
The biomed integration initiative actually began several years ago in an effort to cut costs, Fierens [the hospital exec over Biomed] reports. But as Project Genesis [their EMR project] has moved ahead, and as the technology in the biomed equipment area has advanced, the broader goals of improved care quality and workflow have come more fully into focus, he says. The biggest challenge, says Fierens, is that “you’ve got to balance the economics with the infrastructure and support, along with the service element, along with the clinical outcome you’re trying to support.”
The route to medical device connectivity for hospitals is neither clear or straightforward.
Scalabilility Challenges Wireless LANs
When thinking about wireless networks in hospitals, most people think about coverage, and coverage is certainly an important requirement. A network performance metric that is less obvious but perhaps even more important is capacity. Capacity refers to the number of clients associated with an access point (AP) and the total bandwidth that’s available in a given location.
All of this was once again brought into focus for me during a conversation with Phil Belanger, founder and chief marketing officer for consulting firm Novarum. Phil has been in the wireless LAN market a long time, starting with Zilog and Corvus and served as co-chair for the IEEE work group that defined part of the initial 802.11 wireless LAN standard. He ended up at Cisco when they acquired Aironet.
As more medical devices incorporate connectivity, the number of potential WiFi clients around a patient increases. For example, let’s imagine a patient with 5 B Braun infusion pumps, each with its own WiFi radio. Add to this a Dash patient monitor and a ventilator; the Dash has embedded WiFi and the vent has a third party wireless module. Besides these 7 wireless clients, each caregiver has a wireless VoIP phone and most physicians also have WiFi devices (PDAs or smart phones).
Now imagine that there are similar patients in just 3 near by rooms. What happens when a code is called in one of those rooms and 3 caregivers, and a bit later a couple physicians respond. Let’s see, that’s 7 wireless devices times three patients, for 21 active associations with the network. Of the 5 people responding to the code, say 2 of them are having wireless VoIP conversations (say with specialist, or looking for a STAT diagnostic test result) and 1 is charting the code on a COW. That’s 24 associations.
What happens if an acute care patient being transferred goes by, adding 3 more associations and another wireless VoIP call? Or another code is called in the same vicinity? Do calls get dropped and the means to receive urgent information is lost? Are associations with the network lost by medical devices? Which ones? Could it be a device connected to a lone patient in a private room? Might life critical alarms be missed?
Draeger Certifies Trapeze Wi-Fi with Infinity Patient Monitoring Line
Yesterday, Draeger announced that they had completed interoperability testing with WiFi infrastructure vendor Trapeze Networks. What they call a “Certification Notice” indicates that they’ve completed formal verification testing (and probably a “letter to file” for regulatory purposes) to ensure that their regulated medical devices, running on a Trapeze wireless LAN, operate within specifications. Aruba announced at HIMSS 08 their certification for use with Draeger’s Infinity patient monitoring system. Also, Aruba and Welch Allyn announced interoperability at HIMSS 07.
Here’s how Draeger describes their certification effort (emphasis mine):
In Drager’s notice of certification, Lars Roth of Drager’s Monitoring Systems and IT group, wrote, “Due to the critical nature of medical devices, Drager Medical tests and verifies network hardware components used for communication between medical system devices. These tests include proper IP Multicast handling, wireless roaming, wireless encryption and load testing. In addition, tests with competing traffic are run in order to understand and detect the proper Quality of Service settings. These are the key parameters that will ensure that in a shared Infinity OneNet installation, the data flow of the Drager patient monitors is being prioritized over non-patient monitor data.”
Most medical device vendors complete validation test for a new product supporting that one WiFi infrastructure vendor at market launch and beyond. Depending on the regulatory strategy of individual vendors’ products, completing the validation with additional wireless LAN vendors can be very time consuming and expensive. Compounding this is the fact that verification test is a common R&D bottleneck for many medical device vendors.
