General Electric, a diversified infrastructure and finance company, and chips major Intel Corporation yesterday announced an alliance that will spend $250 million in the next five years to market and develop hi-tech healthcare products.

These technologies will help seniors live independently and patients with chronic conditions manage their care from the comfort of their home or wherever they choose.

According to the Centers for Disease Control and Prevention, chronic diseases such as heart disease, diabetes and hypertension kill more than 1.7 million Americans per year, and are responsible for 7 of every 10 deaths in the US.

With the dramatic increase of people with chronic conditions and an aging population there is a need to extend care from the hospital to the home, GE chairman and CEO Jeff Immelt noted.

GE Healthcare will sell and market the Intel Health Guide, a laptop-sized device with a touch screen into which patients plug digital scales and blood-pressure cuffs so the data can automatically be sent to a nurse monitor. The device includes a video linkup to the nurse station and an alarm that automatically rings if a patient fails to check in at his or her appointed daily time.

 ''This is going to be a big business for us,'' Immelt said. ''What GE and Intel recognise is that more of the care is going to take place in the home.'' 

The market for telehealth and home health monitoring is estimated to grow from $3 billion in 2009 to an estimated $7.7 billion by 2012, according to a study by research firm Datamonitor.

The Federal Interagency Forum on aging-related statistics forecast that by 2030, approximately 71.5 million people will be 65 and older, representing nearly 20 per cent of the total US population – up from 37 million Americans in 2006.

 ''We think this partnership offers the potential to lower costs by keeping people out of hospitals while giving health professionals the data they need to deliver the best possible care,'' Immelt said'.

''Intel and GE use technology to bring effective healthcare into millions of homes and to improve the lives of seniors and people with chronic illness. Together we can deliver innovative products to serve this rapidly growing market.'' He added.

 ''The GE and Intel partnership will not only help seniors and the chronically ill, but will also take a giant step forward in changing how healthcare is delivered,'' Intel president and CEO Paul Otellini said.

GE Healthcare and Intel also plan to expand their current development programmes in home health and independent living technologies to include new areas such as fall prevention, medication compliance, sleep apnea, cardiovascular disease, diabetes and personal wellness monitoring.

GE Healthcare is leading a consortium of private and public sector organisations in a $5 million three-year home health research program funded by the Hungarian government. Meanwhile, Intel and the Irish Development Agency have established a $30 million Technology Research for Independent Living centre, bringing together industry and academic experts to research independent living technologies.

GE has interests in aircraft engines and power generation to financial services, medical imaging, and television programming. It operates in more than 100 countries and employs more than 300,000 people worldwide.

Intel, the world leader in silicon innovation, develops technologies, products and initiatives to continually advance how people work and live.

Deal likely to impact Philips' bottomline
GE's entry into home health care is likely to threaten Royal Philips Electronics of The Netherlands, a market leader in modern medical solutions.

A comparison between Amsterdam-based Philips and the GE- Intel partnership is not an ''apples-to-apples'' comparison, Immelt said. ''The fact is this is a widely fragmented industry. There's hundreds of companies in this space.''

The GE health-care unit, based outside London, provided $17.4 billion of the parent company's $182.5 billion in sales last year.

Philips's Home Healthcare Solutions had about 1 billion euros in revenue in 2008, or 13 per cent of the medical division's total sales of 7.65 billion euros ($10.3 billion).

''In an aging world with an increase in the number of chronically ill, it's impossible to put all those people in hospital and nursing-home beds,'' Philips CEO Gerard Kleisterlee said on 27 March at the company's annual shareholder meeting. ''The home will have to play a role.''

GE's partnership with Intel comes after Philips bought Respironics Inc for 3.6 billion euros last year, making it the world's largest provider of home health-care products. Respironics sells masks and ventilators for treating respiratory and sleep disorders.

Since 2006, Philips has spent about $6 billion buying companies with home health-care operations, including Respironics, Raytel Cardiac Services, Lifeline Systems Inc. and Health Watch Holdings Inc.

Sales at the Philips health-care unit missed a management target for 6 per cent growth in 2007 as a result of cut in US budget.