Technology outsourcing and consulting major Accenture plc (ACN) recently won a system development contract from the Department of Health and Ageing in Australia. Financial details of the deal were not divulged.
As per contract terms, Accenture will develop and implement an extensive health care system namely Personally Controlled Electronic Health Record (PCEHR). The system will cover all the Australian health care providers under one umbrella. The initiative is in keeping with the Government’s plan announced last year to invest $466.7 million to develop a PCEHR, to provide a better health care system.
Electronic Health Record (EHR) helps doctors and hospitals to organize medical records of patients. The system makes it easy for medical practitioners and patients to track clinical histories, without the hassle of storing hard copies.
The system, designed by the Accenture team, will enhance the quality of health care services at lower costs, helping service providers offer enhanced health care services. The system also seeks to eliminate duplication, needless medical tests and faulty mediation.
Given the extent and demands of the system, Accenture teamed up with technology majors for successful implementation. Consequently, tech behemoths like Oracle Corp. (ORCL) and smaller companies like Orion Health and Telstra Corp. were also involved in the Australian health project. The system is expected to be on air in July 2012.
We believe that the successful implementation of EHR in Australia will create new business opportunities for Accenture. In June, Accenture successfully launched a National Electronic Health Record (NEHR) system in Singapore.
In the U.S., the system has been recognized by the government as a core component of national health care reform. The federal government has passed a bill, granting around $19.0 billion in incentives to medical practitioners and hospitals for buying and using EHR systems. This opens the door to additional growth opportunities for companies like Accenture.
We believe that Accenture has the potential to capitalize on emerging health care deals. However, Accenture may have to face stiff competition from Dell Inc. (DELL), the key supplier to the health care sector.
Currently, Accenture holds a Zacks #3 Rank, translating into a short-term Hold rating.
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