113. mc k part 2 osf

H.I.S.-tory

by Vince Ciotti

© 2013 by H.I.S. Professionals, LLC, all rights reserved.

Episode #113:

McKessonPart 2 = OSF

Da Man!• The story of HBO begins with its 3 namesakes:– Walter Huff, founder, chairman and CEO– Bruce Barrington, who led development– Richard Owens, who led implementation

• And a surprising re-appearance of a fourth HIS-tory hero who actually started the troika off on their HIS development path…- Bet not a single HIS-talk reader can guess who this was!?!?

• Credit for this episode goes to Walt Huff who kindly took time off from his busy retirement (he still works with former CFO Larry Gerdes at Gerdes-Huff Investments) to tell this inside HIS-story.

• Walt graduated from Monmouth College in Illinois in 1956 as an economic major – yes another “frozen north” HIS vendor roots!

Generous Alumni• Walt never forgot his debt to Monmouth College, eventually

funding their multi-million-dollar Huff Athletic Center, above.• He started his business career working for the accounting firm of

Peat, Marwick and Mitchell – another pattern? Our last episode on Cerner traced the roots of Patterson, Gorup & Illig from AA…

• Turns out PM&M was big in Healthcare in Illinois back then, and young Walt was assigned to one of their major local clients:

• The Sisters of the Third Order of St Francis in Peoria, IL (OSF). Walt gradually became the manager of that account, and grew increasingly frustrated with their crude NCR posting card system (see episode 5 at hispros.com for details), that made balancing cash & AR a daily nightmare.

HIS-tory Hero Redux• Walt was quite impressed that OSF had installed an IBM 1401

keypunch card system to automate patient accounting functions in the early ‘60s. And who was the DP Manager at OSF? You may as surprised as I to learn it was none other than Urban Gerber, the same man of later Gerber-Brehm and Gerber-Alley fame (see episodes 22 & 23 for details of these turnkey mini pioneers)!

• Walt left PM&M to become OSF’s CFO in 1963, and they upgraded to an IBM 360 series mainframe in the mid-60s, joining nearby Caterpillar as 360 devotees.

• All 11 OSF hospitals easily ran on the new hardware, but software was another issue. They tried running IBM’s PAL and SHAS, but didn’t like the batch processing, so R&D maven Bruce Barrington built OSF’s own Centralized Real-time Accounting System for Hospitals, aka “CRASH” (I’m not making this up!). Urban left OSF to join Ross Perot, and Dick Owens led the CRASH installation effort.

From Crash to SHIS to HFC• OSF’s CRASH used IBM 1050 terminals at its hospitals throughout

IL, transmitting data back to the central OSF mainframe in Peoria, enabling real-time inquiry into AR accounts (like SHAS), as well as real-time edits (a vast improvement over SHAS’ batch TCEs…).

• Walt’s next challenge was eliminating the 2-3% of lost charges hospitals incurred, so his team began to write a Shared Hospital Information System (“SHIS” – thankfully, the word Technology wasn’t in vogue at the time…) with on-line Order Entry replacing multi-part charge requisition forms with their carbon-paper copes requiring physical delivery to ancillaries and the B.O. SHIS was funded through a government grant Walt received for ≈$3M.

• SHIS employed the same plastic overlays that SMS’ Mike Mulhall used at Monmouth in NJ at IBM’s pioneering HIS project (see episode 8 for details) to guide clinicians through the (too) many keystrokes…

CRASH & SHIS go commercial• The Illinois Hospital Association (IHA) was so impressed by Walt’s

teams’ new systems that they installed CRASH at 31 member hospitals by 1970, when OSF also completed the 1st demo of SHIS.

• OSF's DP department was now generating more revenue than some of its smaller hospitals, and its Board decided to spin off the outside business, reaffirming their hospital-based mission only.

• The leading bidder was nearby McDonnell-Douglas in St. Louis, who sent a consultant named Chuck Barlow to study the potential. Chuck’s report was so glowingthat Bob Harmon, head of their McAuto DP division, told Chuck: “If you’re so bullish, you run it” – and the rest is HIS-tory…

• Not surprisingly, McAuto re-named CRASH as HFC (Hospital Financial Control), and SHIS morphed into HPC (Hospital Patient Control), a predecessor to the later, Tandem-based PCS. Walt, Bruce & Dick all came along with the deal reporting to Chuck, but were allowed to stay in Peoria and run the 360 data center there.

Mighty Minis Match Mainframes• In the early 70s, minicomputers started their entrée

into the DP world, and Bruce Barrington explored Four Phase minis as a front-end to HFC, replacing the keypunch-card 1050 terminals. To quote Walt directly:“Barrington became very familiar with the equipment and software, even maybe knowing more about its capabilities than Four Phase themselves.   By 1972 I had made a presentation requesting funds to develop a data collection system using Four Phase equipment.  MCAUTO turned it down saying that little minicomputers would never replace mainframes…”

• Wow, what a quote - sounds like what most IT pundits said about PCs a decade later! And what my Microsoft DOS friends said when I bought my first Apple Mac in 1987…

• “Bruce decided to leave and develop the software on his own. Four Phase let him use their facilities in Chicago at night. Bruce was a great innovator of software and created his own operating system on Four Phase called ROS which ran MEDPRO. After a couple of months he got Owens to join him in the effort and finally by 1973 they had convinced me that they had something very worth while.”

HBO Is Born!• So there it is, right from the horses mouth: how HBO was born,

and another HIS pioneer, Urban Gerber, helped them get started! Next week we’ll pick up the fascinating inside story from Walt about how he, Bruce and Dick built MedPro and IFAS, played some fascinating corporate games over their Co. name, etc.

• But first some more feedback from HIS-Talk readers about those puzzling picture portraits – starting with an old SIDA friend:– Hi Vince, I trust you are doing well and like me, gracefully getting old???

I was just reading you’re HIS-tory for Monday, Oct 14th, and let me offer the following... C on Slide 11... is that Rick Adam (sp?) from the old IBAX days? Also, P on Slide 11... isn’t that Mark Fidler from his Continental days, then Clinicom, and a few other companies....? Love your work; it really does bring back some good memories. Larry Pawola, PharmD, MBA, Director of Graduate StudiesDepartment of Biomedical and Health InformationUniversity of Illinois at Chicago (312) 996-1446”

On The Other Hand…• However, picture C also got this input form another reader:– Rhonda Russell, VP, EIS Services, Bell South:

“On Bill Child's portraits, C might be Glen Rosenletter, formerly the head of international business for HBO. And on the timeline, Quadramed is Duncan James, not Jim Duncan :)”

• Ohhhh, I’m such an idiot spelling Duncan James’ name wrong on the C-Suite timeline. And I’m going with Rhonda over Larry for picture C – after Walt Huff thought it looked like him too:

“Glen Rosenkoetter was a star salesman at HBO when I was there.”

• Jeff Parypinski, VP at RelayHealth, also caught the Duncan gaffe and pointed out a brand new CEO at Healthland:

1. Chris Bauleke, formerly of McKesson, is now CEO of Healthland. (Angie Franks now reports to him)

2. The Jim Duncan listed under QuadraMed is actually Duncan (1st name) James (last name).

But Wait, There’s More…- Don Morrison - R.Ph., MBA, Florida Health Alliance

• “Vince, I believe that the individual on Page 11, Letter “P” is Mark Fidler, who is believe is still a recruiter in the HIS Industry. I believe he is a former McAuto person from the 80’s, but don’t have a lot of other background on him, other than he has come up with a couple of positions for me over the years. His phone number is 817-251-8913 and his email is fidlerm@aol. I haven’t spoken with him in a couple of years so I’m not sure if that information is current. I have enjoyed your series immensely. One company that I have not seen, or may have missed, is SoftComputer. I believe that I met you in the mid 90’s when you were doing a selection involving them and I was attempting to develop a pharmacy system for them (by myself!). They would surely make an interesting story, I’d say that they are the biggest secret in HIS as practically no one has heard of them and I believe they have hundreds of customers. (And a totally unique style which would even make Judy Faulker appear normal). Anyway, best of luck, thanks for the series, and I’m pretty sure that guy is Mark Fidler. Take care. Don”

Updated Portraits

• So here’s how things stand identifying these faces in Bill Childs’ challenge from an article in his Computers in Healthcare magazine from the late 1980s.

• I’m going with Rhonda on picture C unless any readers can decide between her and Larry Pawola’s suggestion it might be Rick Adams!?

Mark Gross Rosenletter

Art Randall Frank Russo Steve Macaleer

Peter Marsh Ford Phillips Shirley Hughes Mark Fidler

Steve Huseing

HBO’s C-Suite Timeline• As if he has nothing else to do, Walt Huff was kind enough to

clear up HBO’s long line of Chairmen & Presidents over decades:“Vince, I just got to looking in detail at the HBO time line. The following are

people and approximate dates as I remember them.- 1973 founding and Huff was Chairman, CEO and President- 1983 John Lawless became President- 1984 Holding company formed and Jim Napier was President of Holding company. John Lawless was CEO and President of HBO sub- 1985 Holding company abandoned, Huff = Chairman, President and CEO- 1986 Lawless left company- 1990 Huff left as officer and board member. Holcomb Green became Chairman, Darrell Young president of HBO (mini computer division), Robert Murrie President of MEDIFLEX (Facilities Management), Larry Gerdes, President of the Equipment Maintenance Sub SSI)- 1991 Holcomb Green Chairman, Charlie McCall, President - 1995/6 Charlie McCall Chairman, CEO and President

Hope that helps, and dates are the best I can remember. Walt”

Latest Vendor C-Suite Timeline- With HBO’s executives, Duncan spelled correctly, and Angie’s new boss: