The COVID-19 pandemic has reinvigorated interest in modernizing Canada’s healthcare system. For its part, the Competition Bureau (“DeskThe Digital Healthcare Market Study, to examine how pro-competitive policies can foster innovation and provide more choice and access to digital healthcare services for Canadians. After consultations with a range of stakeholders, the office published its first report on the competitive role of personal health information in June 2022, followed by a second report in October 2022 on improving health care through pro-competitive procurement. A third and final report is expected in the coming months. The Bureau papers highlight some of the key organizational, technical and procedural aspects of the current Canadian healthcare system that may hinder competition, and make several recommendations that, while lofty, have the potential to significantly influence the competitive landscape.
Part 1 – Unleashing the Power of Health Data
While Canadian healthcare systems are rich in data, healthcare providers have struggled to turn this data into information that can be used to innovate and improve patient care. The first report , Unleash the power of health data, proposes steps for Canadian policymakers to improve access to and sharing of personal health information with the goal of promoting competition and innovation in the healthcare industry. Looking specifically at primary care electronic medical record systems (that is, systems used to collect personal health information in family physician offices, hospitals, and other primary care settings), the report identifies two major barriers to competition:
- Disparate privacy and data management rules across provinces and territories create structural inefficiencies, resulting in market fragmentation and high entry costs for new players. As a result, only a few primary care EMR companies currently compete in most provinces and territories while PEI, Newfoundland, Labrador, Northwest Territories, and Nunavut are limited to one EMR primary care provider.
- With no standards for data storage across PHC EMR records, information is restricted to the specific EMR system chosen by the PHC provider, making it difficult to switch between EMR records or share patient information with other healthcare providers. using a different electronic record. Furthermore, primary care EMR companies acquire other healthcare players (virtual care providers, community clinics, etc.) which expands opportunities for vertical interoperability but can also stifle innovation as these companies limit the capacity of other third party solutions. interface with their EMR.
To achieve interoperability between primary care electronic medical record records and electronic medical record systems in other health care settings (such as pharmacies), the office recommends the following:
- Harmonized rules for privacy and data management across Canada Considering counterpart jurisdictions, the Office recommends the use of legislative tools (eg, 21Street Century Cures Act in the US) and digital solutions (eg, “My Health Record”, a standardized national electronic recording system in Australia) to develop a national health data plan. The National Health Data Plan will simplify market entry and expansion for local and international companies, driving increased competition and innovation across the country.
- Require counter compliance–Blocking rules Anti-blocking rules are those that prevent EMR healthcare companies from interfering with access to, exchange, and use of electronic personal health information. Recommended features of an approach in Canada include incentivizing compliance, establishing a common standard for data storage and transmission, and requiring that the cost of sharing data be reasonable.
- Develop interoperability standards The Bureau recommends that these standards should be developed, enforced and operated by an independent organization, in line with international standards and allowing flexibility to develop follow-up innovations.
Part 2 – Improving healthcare through pro-competitive procurement policy
As public entities are the major purchasers of healthcare products and services in Canada, public procurement rules play a key role in determining who can compete for government contracts, thus driving demand-side competition and innovation in Canada’s digital healthcare sector. The office’s second report focuses on how strategic use of government procurement rules can lead to greater competition, innovation, and choice for healthcare providers and patients. In particular, the report emphasizes the role played by small and medium enterprises (“SMEs”).Small and medium-sized companies”) in driving innovation and the need for a public procurement process that facilitates opportunities for these companies. Through its consultations, the Office identified six barriers to competition in the public procurement process:
- Health care is under the jurisdiction of the provinces and territories, while the federal government is under the jurisdiction of the states Canadian Health Act, identifies national principles that are reflected in health care plans at the provincial and territorial levels. This creates a fragmented procurement structure of 14 different jurisdictions, each with different priorities, laws, regulatory powers, and levels of centralization.
- Too strict or incorrectly defined RFP requirements can eliminate potential bidders, especially SMEs, who can offer innovative solutions.
- Focusing on price over value, quality, or results can discourage innovators and small and medium-sized businesses who often cannot match the low prices offered by larger companies.
- Risk avoidance can favor existing or known systems and vendors over new or innovative solutions.
- The rate of innovation can outpace public procurement cycles, which means that products and services can become obsolete by the time the procurement process is completed. Lengthy procurement processes can also delay return on investment for innovators, affecting product development further.
- Excessively prescriptive policies (for example, requiring the use of a particular product or vendor) can drive potential innovators out of the market and remove pro-competitive effects.
To address these barriers and promote competition and innovation through procurement policies, the Bureau recommends the following:
- Creation of a National Innovative Procurement Center of Expertise to create a Canadian roadmap for implementing innovative procurement.
- Public buyers self-assess their practices and remove any barriers in order to favor competition, such as concern for the full life cycle of a product or service, how changes in technology may affect current and future needs, and any switching requirements between vendors.
- Supporting innovation-friendly procurement processes including (i) the use of functional rather than technical requirements to allow vendors to compete on ways to achieve desired outcomes, (ii) the reduction of red tape to facilitate effective SME participation, and (iii) the use of flexible award criteria that considerate of quality and price.
To complete the digital healthcare market study, a third and final report is expected to be published in the coming months. The final report is likely to cover some common themes that arose from the Bureau’s consultations with stakeholders and that were not fully addressed in the first two reports, including compensation for healthcare providers, policies that limit the expansion and delivery of digital healthcare products and services, and enhancing access and capacity. On affordability and literacy regarding digital solutions and patient protection.