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TheStreet Open House

Avaya Solidifies Hold in Health Care With Acquisition

Stocks in this article: SI CSCO MCK

Avaya recently acquired Nortel's Enterprise Division through a bankruptcy process, and uncovered tremendous opportunities in the health care sector.

Sanjeev Gupta, general manager of Healthcare Solutions at Avaya, recently explained what is occurring and what Avaya is doing to help solve major problems.

Presently, there are over 5,000 health care providers, and they all face a common set of issues. Here's the trend: Operating margins are a huge issue, payments for services are decreasing, the number of patients is increasing, and costs are going up. They face the challenge of increasing revenue with the same amount of assets. There is a shortage of employees as well, specifically nurses.

Studies show that nurses spend one-third of their time on caring for patients while the other two-thirds is for administrative work, which is a clear example of a task that can be expedited with automation.

Sanjeev gave me a very specific problem -- long wait times in emergency facilities at an oncology facility with over 700 beds. Even with an EMR (Electronic Medical Record) System and a bed management system, a lot of the care in this oncology facility still required the coordination of discharge to be handled by nurses.

The actual discharge process can't begin without approval from a primary care physician, after which the nurse has to talk to a specialist to make sure they were okay with the discharge. After receiving that approval, the nurse has to talk to the pharmacy, the outpatient pharmacy, nutrition and dietetics. In addition, she has to call maintenance to wheel the patient out and finally inform the patient's family the time the patient will be discharged. The average discharge time is around 6 p.m.

Avaya has found that the process can be changed so that nurses go into a standard system, and an application handles the administrative processes for them. That's all they have to do -- initiate the process.

In the background, the software handles numerous phone calls, while the nurse continues working.

The result? four hours were shaved off of the discharge process, with every hour equating to about a $1 million net benefit, or $4 million saved in this specific application. You've also let the nurse focus on their work and not the administrative processes that support it.

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