CSC Reports Status of NHS Memorandum of Understanding and Advance Payment

CSC CSC reported today on the status of its pending memorandum of understanding with the National Health Service and the advance payment made by the NHS on April 1, 2011 under the company's Local Service Provider contract with the NHS for development and deployment of an integrated electronic patient records system. On September 22, 2011 the U.K. Major Projects Authority, the joint U.K. Cabinet Office – Treasury body which oversees large public sector projects, published in redacted form its “Programme Assessment Review of the National Programme for IT” (NPfIT) following completion of its review of the overall NHS IT program for delivery of an integrated electronic patient records system. The review included a review of the company's Local Service Provider contract. The Major Projects Authority concluded that the elements and vision of NPfIT relating to connectivity and flexibility remain valid, however the view of a single all encompassing service delivering full integration does not align with the needs of clinicians and should be simplified. The report also concluded that the Local Service Provider contracts, including the company's contract, are owned centrally but delivered into a care setting that is the responsibility of individual trusts and, therefore, authority and responsibility under these contracts in the future should be clearly aligned in the new NHS environment of local decision making. The company has publicly expressed its full support for this direction, which was first announced by the NHS in September 2010, and believes that the significantly modified, more flexible approach proposed by the company in the MOU to drive faster deployment and support more localized decision making will enable the U.K. government to reap the benefits required from past investments. In a statement issued on September 22, 2011, Cabinet Office ministers and NHS officials stated that they would continue to work with existing suppliers, such as the company, to determine the best way to deliver services in a way which allows the local NHS to exercise choice while delivering the best value for money. The company has reiterated to the U.K. government its view that these factors were key principles on which the parties conceived and negotiated the MOU. A series of meetings between the company and the NHS and Cabinet officials have been arranged over the next several weeks. However, there can be no assurance that the MOU will be approved nor, if it is approved, what final terms will be negotiated and included in the MOU. Progress is continuing in development and deployment projects under the contract in cooperation with the NHS, although progress has been constrained due to the uncertainty created by the government approval process. Humber NHS Foundation Trust has been confirmed as the early adopter for mental health functionality to replace Pennine Care Mental Health Trust, which withdrew as an early adopter in April 2011, and CSC and the NHS are preparing to formally document this replacement under the contract.