Errors found in procurement of healthcare system

11 June 2018

An investigation by the South Australia state ombudsman has found “cumulative errors” in the procurement of an electronic health records programme.

The ombudsman was called in to investigate whether South Australia’s Department for Health & Ageing had committed maladministration by engaging consultants ZED to manage and lead the implementation of the new system.

ZED was engaged by direct negotiation rather than open tender to oversee implementation of the Enterprise Patient Administration System (EPAS).

State ombudsman Wayne Lines said in a report summary there was “insufficient information… as to the rationale to justify the direct engagement approach”.

However the investigation cleared the department and its executives of maladministration and misconduct.

The ombudsman criticised the department for failing to disclose ZED contracts and said it was required to do so, as ZED was technically a consultant rather than a contractor.

The report said contracts with the consultant failed to reflect the scope of the actual work performed by ZED.

It also criticised the ongoing engagement of the consultancy even after contracts had expired and insufficient detail in relation to risk management.

Incorrect contract amounts and a lack of probity in reviews were also found in the investigation.

“While the ombudsman did not consider that the department’s practice in itself amounted to maladministration, his view was, however, that the cumulative procedural errors in relation to contract execution and the failure to disclose the contracts was particularly significant given the scale and nature of the EPAS project and the public interest in its implementation,” said the report.

The report also criticised a failing to maintain records of a significant number of invoices and recommended the Department for Health & Ageing disclose all ZED contracts.

A spokesperson for SA Health said: “The ombudsman’s investigation cleared the department and individuals involved of any misconduct or maladministration findings.”

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