FCR(98-99)39

For discussion
on 30 October 1998

ITEM FOR FINANCE COMMITTEE

CAPITAL WORKS RESERVE FUND
HEAD 710 - COMPUTERISATION
Department of Health
New Subhead "Laboratory Information System"

Members are invited to approve the creation of a commitment of $62,346,000 for the development of a Laboratory Information System in the Department of Health.

PROBLEM

The Pathology Service of the Department of Health (DH) needs a computerised Laboratory Information System (LIS) to cope with the increasing demand for laboratory services in a cost-effective manner.

PROPOSAL

2. The Director of Health (D of Health), with the support of the Secretary for Health and Welfare and on the advice of the Director of Information Technology Services, proposes to develop and implement a LIS for the Pathology Service, which will enhance its efficiency in handling laboratory tests and strengthen the Government's ability to prevent and control communicable diseases.

JUSTIFICATION

The Existing Practice and Its Problems

3. At present, DH's laboratory services are delivered through five regional laboratory centres, one virus unit and one neonatal screening unit. Each of them comprises a number of specialised laboratories, which handle a wide variety of tests ¹ . In 1997, altogether 5 781 000 tests were handled. It is estimated that the number of tests required to be conducted will increase at a rate of about 9% per annum.

4. Despite the tremendous volume of tests and data involved, the use of information technology (IT) in DH in processing those tests is very limited. Laboratory staff have to perform the following routine tasks manually - checking the request forms and specimens; entering the details of the patient, specimen, etc. into the worksheets; and after testing, putting down the results on the worksheets / result records / request forms. To handle one single request, the staff may have to transcribe patient and test data from one source to another several times. Different laboratories use different formats and media (in paper form or in standalone personal computers) to store the test results and quality control data.

5. There are deficiencies in the above practice, which include -

1. tracing records is time-consuming which could affect the monitoring of progress of a patient under medical treatment;

2. collection, analysis and transfer of data is not speedy enough to provide timely information upon the occurrence / outbreak of communicable diseases; and

3. compilation of management information reports required for health and disease surveillance from the fragmented data is difficult.

Improvement to DH's Laboratory Services

6. To strengthen the Government's ability in preventing, controlling and combating communicable diseases, DH will centralise its laboratory services into two central laboratories, namely the Clinical Pathology Laboratory Centre ² (CPLC) at Lek Yuen, Sha Tin in 1999-2000 and the Public Health Laboratory Centre ³ (PHLC) at Shek Kip Mei, Kowloon in 2001-02. DH will also set up two specimen collection centres in the existing laboratories in Sai Ying Pun and Yan Oi Polyclinic in Tuen Mun in 1999-2000.

7. In addition to centralising the laboratories into two new centres, there is a need to enhance their operational efficiency through the use of IT. Over the years, the practice of laboratory medicine has changed remarkably as a result of advances in scientific methodology and IT. Many overseas countries, including USA, UK, Japan and Singapore, have developed and made use of computerised information systems to manage laboratory test requests and records and to analyse data. The Pathology Service of DH has lagged behind in the application of IT.

8. To enhance DH's capabilities to provide better patient care and to protect community health against communicable diseases, we propose to equip its Pathology Service with a computerised information system, namely, the LIS, to enable CPLC and PHLC to operate effectively and efficiently to cope with the rising demand for laboratory services.

The Proposed System

9. The prime objective of implementing the LIS is to provide a more efficient support system for the processing of laboratory tests. The system will reduce the manual work required for receiving test requests, reporting results and maintaining records; minimise the manual transfer of data from one source to another; reduce transcription errors by building interfaces between the LIS and laboratory equipment as far as practicable; provide a more effective means for handling enquiries about test results; and reduce the lead time and effort for producing management information.

10. In December 1997, the Information Technology Services Department (ITSD) commissioned a feasibility study to assess the technical viability and resources implications of implementing LIS. The study recommended that the best approach would be to identify a suitable application software package available in the market and customise it to meet DH's requirements. This will reduce the time required to deliver the system.

11. The proposed LIS, comprising 11 major user function groups as outlined in Enclosure 1, will link up about 200 workstations located in CPLC, PHLC and the specimen collection centres. The system will allow test request entry by barcode / document image scanners or by the keyboard using abbreviated codes. After test request entry, barcode labels will be printed out for specimens and individual worksheets will be produced showing the tests to be performed by each technical staff. The LIS will be connected on-line with the laboratory equipment, which will receive work order and subsequently upload test results automatically to the LIS. Data will be collected from different sites and information stored into a centralised database to facilitate data analysis at all time. Useful management information can be quickly generated and up-to-date stock records can be maintained. The test results and historical records will become easily accessible to the authorised users.

Anticipated Benefits

12. With the proposed functionality of the system set out in paragraph 11, LIS will bring about the following benefits, enabling DH to provide better patient care and to enhance its health and disease surveillance system -

1. Speedier Processing Time and Compilation of Reports

   With the establishment of the wide area network and the centralised database, LIS will reduce remarkably the turnaround time in the testing processes. For instances, it will speed up the response time to enquiries about patients' test results from half-day to half a minute; will reduce the turnaround time for test results by two working days for all test requests; and minimise the lead time for completion of management information and statistical reports from two to three weeks to one day.

2. Improved Quality of Service

   LIS will make available a patient's current and previous test results from different specialties from a centralised database. The doctors will have a more comprehensive knowledge of the patient's health conditions and more important, obtain the test results sooner with the shorter turnaround time. Patient will receive quicker and better patient care.

3. Improved Data Security and Accuracy

   LIS will safeguard data security with proper classification of authorised users. The transaction of data through electronic links and the generation of management information reports in-situ will greatly reduce the risks of human error.

4. Improved Data Collection and Analysis

   LIS is capable of capturing more data from a wide variety of sources within a short period, and of managing / analysing them. This will enable DH to make early detection of possible outbreaks of communicable diseases. At present, statistics related to the occurrence of communicable diseases are gathered on a monthly basis from different laboratories. With LIS, up-to-date statistics will be readily available from a centralised database for compilation of reports as and when required, helping to alert management of any unusual disease occurrences and emerging trends.

5. Improved Ability to Cope with Workload

   LIS will minimise the manual handling of test requests and eliminate duplicate workload such as transcription and checking of data. These will improve the laboratory's efficiency significantly and achieve staff savings.

Cost Savings

13. Major savings will come from the anticipated reduction of staff for handling the testing process. We estimate that a total of 32 posts will be deleted from DH's existing establishment by two phases, namely, 16 posts in 2000-01 and the remaining 16 posts in 2003-04. This amounts to a realisable annual saving of $8,697,000 from 2004-05. With LIS, DH is able to identify and avoid carrying out unnecessary duplicate tests, which amount to about 1.5% of the total number of test requests. As a result, there will be an annual saving of about $282,000 arising from consuming less reagents and consumables.

14. The streamlined handling process will also lead to some notional staff savings, arising from reduced staff efforts ⁴ on paper work, equivalent to $719,000 in annual staff costs. In addition to the above, the new system will achieve annual staff cost avoidance amounting to $16,715,000 in 2006-07, comprising $8,120,000 achieved by reducing the number of additional technical staff ⁵ otherwise required to cope with the 9% annual increase in workload, and $8,595,000 being the annual staff cost of 17 additional posts ⁶ which will be required if DH were to achieve certain necessary service improvements without the LIS.

15. The total savings will amount to $26,413,000 by 2006-07, broken down as follows -

	2000-01 $'000	2001-02 $'000	2002-03 $'000	2003-04 $'000	2004-05 $'000	2005-06 $'000	2006-07 $'000
(a) Realisable staff savings	1,445	4,336	4,336	8,334	8,697	8,697	8,697
(b) Notional staff savings	142	425	425	694	719	719	719
(c) Cost avoidance	4,741	6,618	9,568	13,235	14,395	15,555	16,715
(d) Savings in reagents and consumables	141	169	216	282	282	282	282
Total annual savings	6,469	11,548	14,545	22,545	24,093	25,253	26,413

Cost and Benefit Analysis

16. We have carried out the usual cost and benefit analysis applicable to computer projects as shown in Enclosure 2, taking into account the above and notional savings. The analysis shows that the proposed system will break even in year 2006-07. On the other hand, significant non-monetary benefits will accrue from the more speedy and comprehensive response to test requests, better patient care and more effective monitoring of communicable diseases.

FINANCIAL IMPLICATIONS

Non-recurrent Cost

17. The total non-recurrent cost for implementing LIS is $68,506,000. A breakdown of the costs and cashflow is as follows -

		1998-99 $'000		1999-2000 $'000			2000-01 $'000	2001-02 $'000			2002-03 $'000		Total $'000
Non-recurrent cost for development and implementation
(a) Computer hardware, software and networking equipment		0		19,746			8,463	2,375			5,937	36,521
(b) Implementation services		994		4,842			1,734	1,657			4,143	13,370
(c) Site preparation		0		1,017			436	1,330			3,324	6,107
(d) Miscellaneous		0		168			72	126			314	680
(e) Contingencies		100		2,577			1,070	549			1,372	5,668
		______		______			______	______			______	______
Sub-total		1,094		28,350			11,775	6,037			15,090	62,346
		______		______			______	______			______	______
Non-recurrent staff costs
(f) Staff costs
(i) DH		488		1,620			324	727			1,748	4,907
(ii) ITSD		364		501			65	97			226	1,253
		______		______			______	______			______	______
Sub-total		852		2,121			389	824			1,974	6,160
		______		______			______	______			______	______
Total		1,946		30,471			12,164	6,861			17,064	68,506
		______		______			______	______			______	______

18. As regards paragraph 17(a), the cost of $36,521,000 is for the acquisition of computer hardware, software and networking equipment including servers, printers, hard disks, scanners, data communication equipment and about 200 computer workstations as well as system software, database management software, computer application package and end-user computing tools.

19. As regards paragraph 17(b), the cost of $13,370,000 is for system development and implementation services. These include project management, system integration, system testing and data conversion services.

20. As regards paragraph 17(c), the cost of $6,107,000 is for the site preparation (e.g. installation of nodes, data ports, power points) and cabling works required for the installation of computer and networking equipment.

21. As regards paragraph 17(d), the cost of $680,000 is for the acquisition of start-up consumables and training for the staff of DH in using the new system.

22. As regards paragraph 17(e), the cost of $5,668,000 represents a 10% contingency on the cost items set out in paragraphs 17(a) to (d).

23. As regards paragraph 17(f)(i), the cost of $4,907,000 represents 59 man-months of DH staff cost to support tendering, system development and implementation (2.5 man-months of Consultant, 4 man-months of Medical and Health Officer, 9.5 man-months of Scientific Officer (Medical), 29.5 man-months of Senior Medical Technologist, 9.5 man-months of Medical Technologist and 4 man-months of Clerical Officer). DH will meet the staffing requirements by redeployment of existing resources.

24. As regards paragraph 17(f)(ii), the cost of $1,253,000 represents 8 man-months of ITSD staff cost for provision of technical advice during tendering, system development and implementation (3 man-months of Chief Systems Manager and 5 man-months of Senior Systems Manager). ITSD will meet the staffing requirements by redeployment of existing resources.

Recurrent Cost

25. The estimated recurrent expenditure for maintaining and supporting LIS are as follows -

	2000-01 $'000	2001-02 $'000	2002-03 $'000	2003-04 and annually thereafter $'000
(a) Maintenance of hardware, system and application software	3,338	4,006	4,516	5,223
(b) System and technical support services	530	636	1,136	1,286
(c) Miscellaneous	8	10	193	450
	______	______	______	______
Sub-total	3,876	4,652	5,845	6,959
	______	______	______	______
(d) Staff costs - DH	183	221	541	1,001
	______	______	______	______
Total	4,059	4,873	6,386	7,960
	______	______	______	______

26. As regards paragraph 25(a), the expenditure of $5,223,000 is for the maintenance of hardware, system and application software as well as the rental of communication lines.

27. As regards paragraph 25(b), the expenditure of $1,286,000 is for outsourcing the on-going technical support services including system, network and database administration. It also includes the support service for system disaster recovery.

28. As regards paragraph 25(c), the expenditure of $450,000 is for the purchase of consumables such as tapes, printer toners and barcode labels.

29. As regards paragraph 25(d), the expenditure of $1,001,000 represents staff cost of 9 man-months of Senior Medical Technologist and 4 man-months of Medical Technologist for system operation, which DH will absorb. Owing to the total outsourcing of on-going support service of LIS, no ITSD recurrent resources will be required.

Implementation Plan

30. We plan to implement the proposed system in two phases to synchronise with the commissioning of new laboratory facilities. The first phase is to implement the LIS in CPLC and the two specimen collection centres by mid 2000. The second phase is to implement the LIS in PHLC by late 2002. The detailed implementation timetable is as follows -

Activity		Target completion date
		Phase 1	Phase 2
(a) Tendering for implementation of LIS		-------- April 1999 --------
(b) Site preparation, procurement and installation of hardware and software		December 1999	May 2002
(c) Development and implementation		March 2000	August 2002
(d) System testing and user training		May 2000	October 2002
(e) Live run		June 2000	November 2002
(f) System nursing		August 2000	January 2003

BACKGROUND INFORMATION

31. The Pathology Service of DH provides medical laboratory support to the Hospital Authority and private hospitals, public and private clinics and health institutions for both patient care and public health functions. It has to respond to changes arising from advance in technology and to increasing demand for laboratory support arising from growing number of patients and the Department's new initiatives for health promotion, early disease detection and surveillance and control of infectious diseases.

32. The laboratory tests are broadly categorised into four main specialties, namely, chemical pathology, haematology, histopathology and cytology, and microbiology. Chemical pathology tests involve the quantification of various analytes in human sera and other body fluids. Haematology tests involve mainly the measurement of blood components and coagulation studies. Histopathology involves the examination of human tissue. Cytology involves the examination of tissue cells in cervical smears, urine, sputum, body fluid etc. Microbiology includes studies on bacteria, parasites, fungi, virus, food and water etc., and involves the putting up of culture, identification of micro-organisms, conduct of drug sensitivity tests, and microscopic examination of various specimens. Upon the setting up of the two central laboratories, chemical pathology and haematology tests will be centralised in CPLC. Histopathology and cytology and microbiology tests will be centralised in PHLC.

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Health and Welfare Bureau
October 1998

Enclosure 1 to FCR(98-99)39

1. Patient Information Maintenance

   This function group allows users to maintain patient demographic information which are collected from different sites (i.e. workstations linked up by a wide area network) and to store them into a centralised database. Hence, specific patient information is readily available to the authorised users for various purposes, such as when enquiring the follow-up status of a patient, or retrieving a previous patient record.

2. Test Request Maintenance

   Like the "Patient Information Maintenance" function group, a centralised database on test request will be maintained. With the centralised historical record, the Department of Health (DH) can immediately identify the duplicate requests for the same patient. DH can also save time and manpower with the use of barcode / document image scanners or the keyboard using abbreviation codes to process new requests speedily in place of the conventional typewriting, filing and record entry.

3. Specimen Maintenance

   After test request entry, this function group will provide function to print out barcode labels, which contain patient and specimen information, for each type of specimen to be tested. The easy identification of specimen enables DH to further save time and manpower in checking and to minimise clerical errors. The functionality of pairing up specimens received at different time is critical for performing serology tests.

4. Quality Control (QC) Request Maintenance

   This function group will enable users to maintain QC test request information for the purpose of periodic quality control of analysers. With the centralised database containing the QC data checking rule / conditions and statistical rules, DH can speed up the computation of QC results (both empirically and graphically) and improve the statistical analysis of the QC results in terms of time and manpower. A large variety of QC reports are available which permits the user to select the information that he needs at a given point in time (e.g. daily or cumulative QC, all tests of a given control, all controls for a given test).

5. Test Result Maintenance

   This function group allows users to maintain test results which are consolidated from different specialised laboratories (either captured automatically from the analysers or entered manually) for central storage. This will minimise human transcription errors, maintain a complete set of information in a well-organised format, and enable the authorised users to have access to the test results once available on a sharing basis. The diagnosis of a case is therefore expedited.

   As for the result entry checking, the software controls (e.g. validation range, panic values, delta-check to be applied on a numeric value) that can be applied at "result entry time" are different depending on the test requested and more precisely on the type of result to be generated.

   This function group also support various modes of result entry (e.g. worksheet result entry, request result entry and optical mark entry). All important images will be captured, incorporated into the test report, stored and recalled as needed.

6. Stock Management

   This function group will enable users to maintain stock information (e.g. expiry date and re-order level of stock) of reagents / consumables and its movement centrally. Based on the forecast consumption rate, DH can manage the stock at an appropriate level and prevent inappropriate usage of containers and other stock items.

7. Billing Management

   This function group will provide function to generate demand notes to the paying clients, based on the tests performed and fees chargeable for each request. The demand note also shows details of test performed, amount payable of each test request, etc.

8. Management Information and Reporting

   This function group will provide both batch and on-line functions to generate useful periodic management information and statistical reports for analysis and forecasting purposes. Examples of management reports are the workload statistics for each type of tests (with breakdown by each specialised laboratory), and the monthly epidemiological report. The system will also provide users with the End-user Computing tools which support Open Data Base Connectivity standards so that they can develop their own ad-hoc reports as and when required.

9. External Interface

   This function group will provide functions to interface with the connected laboratory equipment and another DH computer system - Family Health System - which is being rolled out to about 50 maternal and child health centres. Upon successful test request registration, LIS will then generate work orders and pass them to the connected equipment for carrying out of tests. After completion of tests, the equipment will upload the results to LIS automatically.

10. Reference Table Maintenance

    This function group will enable users to maintain the abbreviated code information, which can be retrieved for input entry throughout the processes of entering patient demographics, test request registration, etc. For example, individual tests or profiles (group of tests) may be selected by using mnemonic code previously defined by the laboratory in the Test Dictionary.

    The standard comments made by pathologists can also be represented in abbreviated codes, expediting the process of test result authorisation and sign-out.

    For the maintenance of business rules, functions will be provided to define customisable rule-based logic or conditions which permit to trigger further actions upon result validation (e.g. to create an additional test, to activate a report printout).

11. System Administration

    This function group provides functions to define the user groups and access security level (e.g. restrictions of personnel to enter, visualise or modify results of those specialities they are not responsible for).

    The security functions will log and control the access to sensitive data and prevent unauthorised access. Any changes involving sensitive data will be recorded in an audit trail file and kept for a specific period of time upon completion of test request. There are also other administrative functions for housekeeping and archiving outdated data.

Enclosure 2 to FCR(98-99)39

	1998-99 $'000	1999-2000 $'000	2000-01 $'000	2001-02 $'000	2002-03 $'000	2003-04 $'000	2004-05 $'000	2005-06 $'000	2006-07 $'000
I. Costs
A. Non- recurrent costs	1,946	30,471	12,164	6,861	17,064	-	-	-	-
B. Recurrent costs	-	-	4,059	4,873	6,386	7,960	7,960	7,960	7,960
Total costs (A + B)	1,946	30,471	16,223	11,734	23,450	7,960	7,960	7,960	7,960
II. Benefits
C. Realisable savings in staff costs	-	-	1,445	4,336	4,336	8,334	8,697	8,697	8,697
D. Notional savings in staff costs	-	-	142	425	425	694	719	719	719
E. Cost avoidance	-	-	4,741	6,618	9,568	13,235	14,395	15,555	16,715
F. Savings in recurrent expenditure	-	-	141	169	216	282	282	282	282
Total benefits (C + D + E + F)	-	-	6,469	11,548	14,545	22,545	24,093	25,253	26,413
III. Net costs / benefits	(1,946)	(30,471)	(9,754)	(186)	(8,905)	14,585	16,133	17,293	18,453
IV. Cumulative benefits	(1,946)	(32,417)	(42,171)	(42,357)	(51,262)	(36,677)	(20,544)	(3,251)	15,202

1. The tests can be broadly categorised into the four main specialties, namely, chemical pathology, haematology, histopathology and cytology, and microbiology.

2. C onversion work at the existing Institute of Pathology, Lek Yuen Health Centre in Sha T in Work has commenced in July 1998 and is scheduled for completion in May 1999. Upon completion, the chemical pathology, haematology and serology tests now conducted in various laboratories will be carried out in this Centre.

3. At its meeting held on 31 July 1998, Finance Committee, upon the recommendation of the Public Works Subcommittee, approved a commitment for the construction of the Public Health Laboratory Centre at a project estimate of $1,313 million in money-of-the-day prices. the W ork will start in October 1998 for completion in June 2001. Upon completion, the microbiology, histopathology and cytology tests now conducted in various laboratories will be carried out in this Centre.

4. Staff efforts of 0.1 Scientific Officer (Medical), 0.2 Senior Medical Technologist, 0.3 Medical Technologist and 0.3 Medical Laboratory Technician I will be saved.

5. With LIS, the number of additional staff required to cope with the annual increase in workload can be reduced by 1 Medical Technologist and 1 Medical Laboratory Technician II per annum.

6. Nine additional posts (6 Medical Technologists and 3 Assistant Clerical Officers) will be required to enhance the monitoring of communicable diseases and provide prompt management information. Eight additional posts (4 Medical Laboratory Technicians II and 4 Assistant Clerical Officers) will be required to speed up the turnaround time for test results by one working day for all the test requests.