IBM agreement with UPMC is latest move in healthcare IT push

By Healthcare IT News
12:00 AM

IBM Corp. is renewing its efforts to gain more healthcare IT business, taking several steps last week to press that point to the industry.

The company sees healthcare as one of three major markets, and the recent moves show its commitment to healthcare IT, said Dan Pelino, senior sponsor and executive for healthcare and part of the corporate worldwide marketing arm for IBM.

Late last week, the company announced an eight-year, $402 million agreement with the University of Pittsburgh Medical Center that will find both organizations initially investing $25 million in joint research efforts. The landmark UPMC agreement followed two other big announcements last week.

On Tuesday, IBM announced that it would acquire HealthLink Inc., a Houston-based healthcare IT consulting firm with 625 employees. Early in the week, IBM also announced it would build a testbed that it plans to deploy in the healthcare field to accelerate development of a standards-based interoperable national healthcare information system.

The recent moves indicate that IBM is moving back into the healthcare IT market. Big Blue has made similar pushes in the past 10 years, but hasn't always been viewed as a market leader.

IBM wants to change that perception, Pelino said. He noted that momentum in the company has been growing for at least a year, pointing back to agreements with other healthcare organizations, including Mayo Foundation.

The UPMC deal, though, is IBM's most ambitious to date. The agreement has two parts; the first seeks to provide a test bed for IBM's "On Demand" approach for delivering technology.

Under the agreement, UPMC's technology infrastructure will be re-engineered to an on-demand environment that will help it flexibly meet business needs as it grows. The approach will help the healthcare organization holds costs down as it deploys its electronic medical record.

In addition, IBM and UPMC will invest in efforts to develop medical technologies and information systems to meet specific healthcare IT needs in areas such as electronic medical records and patient safety. They'll start off with a joint investment of $25 million each, but could put as much as $100 million each into development, IBM said.

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