Published on the 24/03/2022 | Written by Heather Wright

Sector ‘unsupported’ by govt…

Healthtech may have been a driving force during the past two years, but Australian healthtech companies are feeling not just unsupported, but stifled on the innovation front by government.

A new report from industry body, the Medical Software Industry Association (MSIA), whose members include nearly 150 providers from SMEs to large public companies, calls for a level playing field with fairer procurement processes to enable local companies to secure more of the government’s hefty annual ICT spend, and more funding for healthtech companies.

“Our member companies need an environment free of unproductive red tape and built on firm sustainable business cases.”

More than AU$3.9 billion was spent by Australian Government on ICT related goods and services in 2018-19, but despite Australian healthcare companies’ innovation and investment, particularly during the pandemic, the companies themselves are scathing of the lack of support from government.

The report, Beyond the Pandemic – Future Proofing Australia’s Health Technology Industry, includes the results of an industry survey which shows 61 percent believe international companies are favoured over Australian companies in Federal government contracts and more than half deem the government’s ICT processes unfair.

Meanwhile, 59 percent of members believe the federal government stifles innovation. Tellingly, a further 41 percent said federal government policies rely on industry to innovate Australia’s healthcare – with zero percent choosing the third option: Federal government policies encourage innovation. 

All up, that’s resulted in 74 percent saying they felt unsupported by government after two intense years of pandemic innovation. 

It’s a familiar story – across the Tasman, New Zealand IT companies, including healthtech, have long railed against the lack of government support and apparent favouring of big global incumbents over local alternatives. 

Equally familiar will be the comment of one member who said: “Lots of discussions with government after the legislation had passed – if they want a quick turnaround and engagement, then engage us at the idea stage where relevant discussions are still possible and advance notice (even if not final) can be used to plan roadmaps.”

But the MSIA report also manages to draw some financial details out, finding that while 35 percent of respondents received government funding for pandemic related work (a full 68 percent said they provided pandemic related services), just six percent said that funding covered expenditure. 

“We delivered the electronic medical record the recorded vaccination administration for the vast majority of Commonwealth aged care and disability care homes throughout the period, as well as for a large number of Aboriginal Community Controlled Health Organisations,” says one provider.
“We transitioned our customers to Telehealth within days when circumstances dictated… [including] facilitating our prescribing customers to move to ADHA standards-compliant electronic prescribing.

“This all came at a cost, which was not even close to being covered by Federal funding… We are product of our contribution to supporting the health and well-being of some of Australia’s most vulnerable people during the pandemic but feel that we largely had to make it unsupported by the Federal Government,” says the company, which is also providing the EMR for mental health services in growing demand.

And the investments made by the companies? A number reported between $1 million and $3 million. One claimed an investment of more than $5 million. 

Pandemic measures have pushed healthcare to the forefront, with digital technology underpinning much of Australia’s Covid response and the medical software industry powering the nation’s response by rapidly transforming the way healthcare works.

“Exceptional effort and investment by health technology companies saw the industry contributing to the nation’s efforts via vaccine development, genomic tracking, Telehealth, eScripts, online vaccination booking platforms, testing, diagnostics, virtual hospitals, wearables, AI, machine learning, apps and more,” the report says. 

MSIA and its members, however, say despite that work the sector remains unsung, invisible and unsupported and argues that support for the local industry could pay for itself through better healthcare and aid the government in its goal of establishing Australia as a top-10 data and digital economy by 2030.

It has put forward five key initiatives it says will ensure the success of Australia’s health technology sector and a world class export industry, including the development of a sustainable business case, along the lines of the Medicare Benefits Schedule or other transaction payments for services to support the industry to improve patient care and reduce avoidable admissions. The report notes medication errors alone are estimated to cost $1.4 billion annually. “Our industry can prevent much of that.”

Funding to enable thousands of healthcare systems to be safely interconnected, saving ‘more than the amount lost for medication errors’, and a fair go in selling products to government and providers are also called for. The report notes there are nine sets of differing requirements software companies need to manage to sell their software, adding to costs. 

The report also recommends the development of a scheme which includes guarantees enabling Australian companies to compete with large internationals and more focus and future forward investment to develop a skilled workforce.

“Our member companies need an environment free of unproductive red tape and built on firm sustainable business cases,” the MSIA says. “We need to ensure that companies can connect with each other easily when providers want to source outside information. We need to be able to compete on a level playing field in a fair ICT procurement framework. We need a skilled workforce to fuel innovation.

“With the smallest of investments, considerable differences can be achieved now,” the report says. “There is much start-up funding, but there also needs to be investment in the digital health products that are currently world class and can evolve.”