Federal Health Minister Tony Abbott has warned e-health vendors and systems designers eyeing off federal coffers that their products must deliver tangible economic benefits over technological improvements if they expect to get government funding for e-Health.

Delivering the keynote address at the Health Informatics Conference 2005 on Tuesday, Abbott admitted his government has not always made it clear to industry about where or when or whether the government wanted to build its own health IT systems in-house or pay the private sector to do so.

Abbott said the result of this was that systems designers have either hesitated to become involved with government e-heath initiatives or were waiting for a subsidy as the government considered its next move.

"IT companies waiting for mega contracts to build a stand-alone, Australian e-health system are likely to be disappointed because in pursuing HIC (Health Insurance Commission) online for instance, the government is more likely to consider a modest system for rebates to be paid electronically rather than multimillion-dollar deals to build IT systems that people may not use," Abbott said.

The minister then again warned IT vendors they must justify their offerings on economic rather than technological merit for them to be considered. "The imaginative challenge for systems designers and marketers is to ditch the assumption that the advantages of IT are self-evident and try harder to show in this country that IT can make the lives of healthcare professionals easier.

"One of the reasons for the slow take-up of IT systems in health is that patients and tax payers gain the immediate benefits while doctors and health institutions face the immediate cost. To many doctors e-health is a hassle, computers cost money and often seem to have limited clinical use. "For most doctors, existing, low-tech record systems offer adequate detail on patient history, so what is the point of a system which can summon other health professional records as it might even make it easier for rivals to poach their patients."

Abbott also drew a comparison between the finance industry and healthcare, saying that compared to the finance sector, health in Australia is a cottage industry due to the fact that the finance industry can easily exchange financial information with security and privacy, which is a stalling point for various e-health projects.

"If the best and brightest Australians really do gravitate to medicine as our clinical achievements suggest, why can't the health sector go closer to matching the financial sector's administration efficiency and customer convenience?" Abbott asked.

"Obviously using IT in health poses different problems to using IT in the finance sector but even so, the financial sector's ability to move billions of dollars in millions of transactions to tens of thousands of different outlets between hundreds and thousands of accounts with dozens of different financial institutions - plus the customers' ability to access that data from the Internet, poses a challenge to our sector we have not yet met.

"As yet e-health remains a work half done and as the Boston Consulting Group noted last year, expectations are high, but so is frustration about the pace of progress."

Abbott said the government has key roles to play in the e-health landscape; the first is to set standards instead of building systems. Only moving from pilot projects to the real thing will persuade most doctors to work on a keyboard rather than an index card and choose the Internet over the mail. Abbot also predicted that radiology and pathology information will be available online within the next 12 months due to the take-up of incentive programs such as business-grade broadband.

Federal government IT e-health objectives

According to federal Health Minister Tony Abbott, the government has four key objectives for e-health, for which no timeline has been handed down.

1. To provide the health industry with the connectivity (broadband) for access to information and aid financial transfers.
2. To ensure that patients can claim their rebate online from the doctor's surgery.
3. To ensure private patients can access information about rebates, in particular gap payments for procedures and receive one, consolidated bill.
4. To ensure every significant health record is available in a digested form to every patient, while providing health professionals with such patient information.