CHINA FACES $1.5BN SOFTWARE BILL ON HEALTHCARE, SAYS IBM

China's planned Rmb850bn ($124bn) revamp of its ailing healthcare system will generate software spending worth at least $1.5bn, according to IBM's Chinese development laboratory.

The US computer group said it expected that at least 1,000 hospitals would spend at least $1.5m each to set up electronic medical records under the plan, which is expected to be set out in detail by Chinese government officials today.

“This will trigger $1.5bn in software spending from hospitals,” said Matt Wang, vice-president of IBM's China Development Lab. “That is a low ballpark figure. I expect it will be much more than that.”

The company has started working on its first such contract, providing Guangdong Hospital of Chinese Medicine, China's largest Chinese Medicine hospital, with an electronic patient record system which integrates input from both Chinese and Western medicine.

Meanwhile, Chinese state media said yesterday that the government would fund the construction of 29,000 township hospitals and the upgrading of another 5,000 as well as the establishment and upgrading of about 15,000 community health centres or stations in cities this year.

The government has not said how much of the funds are to flow into IT, but IBM expects that in order to prevent waste and improve the quality of care, the upgrading will include the digitalisation of patient records and the establishment of regional medical record networks.

Mr Wang said that the project was a rare example of a foreign company directly benefiting from China's economic stimulus package.

IBM is a leading provider of healthcare software systems worldwide and has contributed electronic patient record systems and regional healthcare solutions for several US states.

But Mr Wang said the Chinese health reform plan eclipsed similar US efforts. Washington has pledged to spend $19bn on health sector IT.