WA audit finds pathology IT replacement two years late and doubled in budget

Once complete, WA's pathology information system replacement project will cost around AU$24 million more than expected and be delivered two years late.
Written by Asha Barbaschow, Contributor

Western Australia's Auditor General has reported the project to replace PathWest's Laboratory Information System (LIS) is expected to be completed two years late and will cost AU$50.5 million -- AU$23.7 million more than its originally approved project budget.

However, as the PathWest Laboratory Information System Replacement Project report explains, PathWest cannot confirm the precise cost of work carried out before 2018.

PathWest provides pathology services to Western Australia's public health system. It operates 50 collection centres, 23 branch laboratories and 5 teaching hospital laboratories, and conducts around 16 million tests each year.

The project was funded in 2014-15, allowing PathWest to replace the LIS -- known as Ultra -- that had been in place since 1994. PathWest estimated replacement costs for that particular LIS was around AU$32.5 million.

As reported by Pulse IT, US firm SCC Soft Computer was appointed in May 2016 to complete the project that was supposed to be due in May 2018.

The North Metropolitan Health Service (NMHS) was the accountable authority for the project until 30 June 2018 at which point the Department of Health (DoH) decided to review the project status and assess the financial situation.

A new project management team took control in October 2018. PathWest and the NMHS then agreed to terms with the Ultra vendor to extend the service contract for 12 months until 31 December 2019, at a cost of AU$734,000.

Health Support Services (HSS) hosts both the current and replacement laboratory information systems.

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Auditor General Caroline Spencer found the NMHS did not provide effective oversight, there was weak project governance and reporting, an inexperienced management team, and insufficiently detailed planning that underestimated the risks and complexity of the project.

The report said that these factors resulted in "inaccurate project budgets, inadequate reporting to senior management, and delays".

"In part, the problems with the LIS project stem from how the DoH oversees ICT across the health sector," the report continues. "The DoH has not developed a comprehensive oversight framework that recognises changing risks in ICT projects across the sector. This is a significant shortcoming."

Although the early project management was classed as ineffective, the report says it has improved since the DoH's 2018 review.

The audit recommended that the DoH adopt a comprehensive, flexible, and adaptive IT oversight framework that adjusts governance to the changing risks of a project.

"While the DoH's ICT oversight currently focuses on major projects, it has not established the ground-rules for identifying high-risk projects, or for monitoring and assessing them over time," the report said, highlighting this as a major reason for the LIS project problems going unnoticed until mid-2018.

The state is still using Ultra, despite it reaching end of life, and the audit raised concerns over its several technical weaknesses, including system outages.

As recommended by the audit, by June 2020, the DoH will have established clear expectations for project management guidance and support for all IT projects in the public health system. HSS, meanwhile, has agreed to finalise and implement a comprehensive suite of IT project management expectations on its end.


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