SmartWard – How to make hospital wards smarter

SOURCE: www.afr.com

AUTHOR: Jessica Gardner

Rob Ferguson was lunching with some mates at Centennial Vineyards in Bowral when he first met Matt Darling.

“He approached us nervously,” Ferguson says. “He wasn’t brazen about it. He sort of said his piece in about two sentences.”

For an introverted suburban Dad, Darling’s approach to a table of strangers in winter 2010 was out of character but he was feeling equally anxious and downtrodden. The founder of health software start-up SmartWard had just been knocked back by some Sydney venture capitalists. Travelling with his wife and two children, Darling had stopped in Bowral on the drive back to Canberra. Darling told the group he was developing software for hospitals but wasn’t sure what to do next. “Would any of you be prepared to give me some advice?” he asked.

Ferguson, the chairman of Australia’s largest medical centre operator, Primary Health Care, offered his notepad for Darling to write down his details and said he would call on Monday.

“He just seemed like a friendly, genial older gentleman and I had no idea who he was,” Darling says. “He called at 9.30am on Monday morning. We talked for two hours.”

Ferguson would go on to become SmartWard’s chairman and an early investor. Anecdotes of luck are not uncommon in the annals of start-ups but what had driven Darling to that point – and still does – was an intensely personal experience. The death of his baby daughter Jem in 2008 from a rare form of brain cancer had plunged the talented software designer into a deep depression. Darling had to step down from his role as a technology adviser to the Department of Prime Minister and Cabinet in late 2009. But following some recuperation he felt the strength to find good from the tragedy.

During the months that Jem spent in hospital before her death, Darling watched as nurses over-burdened with administrative duties struggled to deliver care, leading to errors and drug delivery being missed. He had begun studying the nurses’ movements “almost as a function of needing a distraction” and dreamed up a software that removed the need for hand-written charts as records of patient care.

AN EMOTIONAL STORY

“Everybody who hears the story, it gets them emotionally,” Ferguson says. “He had this searing experience of sitting there and watching. He noticed how stressed the nurses were and how hard it was. It gave him something to think about while he was contemplating all of these personal issues.”

Darling talked to health professionals and managers to research the problem further. He found that doctors and administrators wanted “richer and more reliable information” about patient care. “Their way of going about it has really been to sort of ask nurses to do more admin,” he says. “Nurses race around and do the paperwork as and when a patient is not falling down, vomiting, having a heart attack and so on. Often that record is being created away from the bedside.”

SmartWard enables real time record keeping, making life easier for nurses. It can anticipate what procedure is about to be performed. Doctors and nurses wear electronic tokens and when they approach a tablet, the software reads where they are, what time it is and who they are with. “Through those three things we can extrapolate an incredible amount,” Darling explains.

The time, relationship and location information is cross-checked with the business rules unique to each hospital. For example, complex procedures might have to be performed in front of two medicos. Or the software might anticipate that a nurse who has just been “sensed” coming from the pharmacy is about to deliver medicine. By correlating the different information the software is able to present on screen the procedure that is about to take place. The nurse then confirms.

The software can also improve safety, by warning if a patient is an infection risk or has allergies, for example.

On Monday SmartWard will go live in two wards across the Angliss and Box Hill hospitals in Melbourne. For a month it will run alongside traditional paper records and if administrators are satisfied it is successful it will run for another month on its own.

CLINICAL TRIAL FIRST STEP

A successful clinical trial is the first step in taking SmartWard from fledgling technology idea to sustainable business. In the three years to now, Darling has been awarded $2.4 million in grants from government agency Commercialisation Australia. He has raised a further $4.6 million from private investors.

Along with Ferguson, who tipped in about $150,000, Darling has wrangled capital from about 20 investors including Aspen Medical founder Glenn Keys and former Vanguard Investments Australia chairman Jeremy Duffield.

If Darling can prove that SmartWard improves safety and efficiency and lowers the cost to operators, he will have an enticing sales pitch to hospitals and health services. He expects to sell SmartWard on a per bed, per unit of time subscription service where software upgrades and technical assistance will be included.

He says if one hospital signs on, it could go some way to repaying the $7 million ploughed in so far. But he wants to raise $15 million to $30 million more to create a business of scale.

Darling also wants to bring in a new chief executive, saying the role has probably outgrown himself and co-founders Lindsay Bevege and Malte Stien. “I’m the right person to run a tech company but I’m not the right person to run a sales company,” Darling says. “We’re a small, inexperienced group of passionate people.”

The new boss will be responsible for SmartWard trials overseas, nurturing strategic partnerships and pushing for sales.

COMPATIBLE ETHICS

But Darling is also keen for someone with “compatible ethics” who understands what he is striving for.

“Matt has this belief which is sort of driven by a memorial instinct which gets him out of bed in the morning,” Ferguson says. “He’s got tremendous drive and it’s a matter of matching that with business experience.”

Darling’s motivation is sustained by the humanitarian and economic benefits he hopes SmartWard will spark around the world.

“By 2020 health will account for 25 per cent of GDP in the US,” he says. “We’re already at unsustainable cost levels so something’s got to give. My hope is that rather than fewer people receiving care, which to my mind is unthinkable, I want to make care a lot cheaper. This is what our system is meant to do.”

A “really hard-edge businessman” recently responded with disbelief to Darling’s stance that he was driven by a transcendent purpose to improve the lives of others. “I said to deny transcendent purpose is like denying the placebo effect. You don’t have to be able to quantify it to say that it strengthens you.”