Aiming to slow growth in IT expenditures, Oakland, Calif.-based Kaiser Permanente is transferring management of its data center operations to Armonk, N.Y.-based IBM. Under terms of the seven-year agreement, IBM will oversee the company’s computer systems, storage systems and associated software, while Kaiser Permanente will continue to manage applications. The deal will also see the company eliminate 700 positions in its data centers, although IBM may hire some of the affected employees.“This agreement, grown out of our long-standing strategic relationship with IBM, will allow us to build on our leadership in health care technology, staying focused on the safety, satisfaction and privacy of our members and patients and ensuring that our physicians and clinicians continue to deliver real-time, personalized health care,” Phil Fasano, CIO for Kaiser Permanente said in statement.The health insurer said the deal, and subsequent work force reductions, were necessary to stay competitive in trying economic times. “Making decisions like these that affect employees is never easy,” Fasano said. “However, like many other organizations, due to the slowing of the economy, we are slowing our growth in IT expense which has resulted in elimination of positions.”

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