The Health Insurance Commission (HIC) has begun a technology review covering its outsourcing agreement with IBM GSA and an investigation into Linux as a way to reduce operating costs.

HIC information services manager Lyn O'Connell said hardware infrastructure, from desktop to mainframe, was outsourced to IBM GSA three years ago and it is now time to examine the next stage of the organisation's sourcing plans.

“Our outsourcing contract was part of a wider government IT initiative and for our business it is a better arrangement,” she said. “We are going through the phases of what we are going to do with our next stage of technology sourcing.”

O'Connell said the HIC, which administers government health agencies including Medicare and the Pharmaceutical Benefits Scheme, has its core operations in Canberra, an offsite disaster recovery centre and branches in each state.

She said an investigation is now under way into reducing operating costs through the use of Linux.

“We are looking at the potential for using Linux on our IBM pSeries AIX mid-range platforms and as partitions on the zSeries which run OS390,” she said. “As for the desktop we are not considering Linux as much and did not consider StarOffice as a Microsoft Office replacement.”

Most of HIC’s applications are mainframe-based; however new e-business applications are being introduced alongside the online Medicare claiming tool for doctors, which is already in use.

“We are going through the process of including our API (Application Programming Interface) into practice management software,” O’Connell said. “Also, we are looking more into Web services as our existing server infrastructure should be suitable from a capacity perspective.”

O’Connell declined to specify the value of the outsourcing agreement but did say HIC is currently tackling a desktop overhaul that is part of the outsourcing contract.

She said the HIC is upgrading some 4500 desktops in an attempt to rationalise the number of applications it uses.

“Our decision to undergo a desktop refresh was brought about not so much by any need for immediate savings but rather to avoid incurring costs in the future.

“We will reduce the number of applications from about 900 to 150 and move to Windows XP as the standard desktop operating environment from NT. Duplication of applications was a problem as well as a number of legacy applications that were no longer in use. We expect to complete the refresh in November,” she said.

“This project follows a SAN implementation nine months ago which consolidated a lot of storage requirements.”

Although HIC is definitely in cost-cutting mode, O’Connell said the commission is not looking to consolidate its voice and data networks.

“We are not looking at voice over IP as most of our calls are incoming from customers and I’m unsure about the maturity of the technology,” she said.