ACM to draw up guidelines regarding competition rules in order to mitigate ‘vendor lock-in’ in health care IT

The Netherlands Authority for Consumers and Markets (ACM) will draw up guidelines that will clarify the competition rules for IT suppliers in health care. ACM has found that, in many cases, hospitals are ‘locked-in’ with their suppliers of health information systems. Such situations can happen because of, among other reasons, the supplier’s behavior or because of the arrangements that the supplier makes with health care providers or other providers.

Too great a dependency on a single supplier is a risk to the proper functioning of the market. It can lead to higher prices, and it can act as a brake on the safe and secure exchange of digital information, as well as on innovation in the health care sector. IT suppliers need to ensure that their conduct and their arrangements with other suppliers are not at odds with competition rules.

These are some of the conclusions in ACM’s publication ‘Sector inquiry into the market for information systems and exchange of information in hospital care’. This publication is one of the elements in ACM’s increased attention to the market for IT systems in health care.

What are the consequences of vendor lock-in?

A health care provider can depend on a single IT supplier to such an extent that switching is either not possible or only possible with a lot of hassle or at enormous costs. This is called vendor lock-in or a vendor trap, for example because transferring data is either difficult or impossible. In addition, it can be difficult to link systems or applications of other IT companies to those health information systems. If a health care provider is stuck with an IT system to so high a degree, it creates risks to competition with negative effects on price, quality, and innovation of IT systems and applications in health care, and eventually on the quality of health care itself.

What are the next steps?

The negative effects of vendor lock-in can be mitigated by making it easier to transfer data, and by improving the communication and compatibility between different system and applications. All market participants are able to help realize an open, long-lasting information system in health care. ACM will draw up guidelines clarifying the boundaries and obligations that follow from competition rules to IT suppliers, while also providing examples thereof. After consulting with other regulators, including the Dutch Data Protection Authority (AP) and the Dutch Healthcare Authority (NZa), ACM will draw up draft guidelines in the fall, and will subsequently publish them for public consultation. In addition, ACM is able to act against market participants that violate competition rules. ACM emphasizes that there is always room for collaborations between different market participants that are aimed at creating services and infrastructure that are essential to health care.

Why does ACM give attention to IT in health care?

ACM’s attention to IT in health care is part of ACM’s focus area The Digital Economy. Well-functioning IT markets in the health care sector are a necessary condition for a long-lasting health information system. It enables health care providers to exchange digital data in a safe and secure manner, gives individuals control over their own health data, and promotes innovation. That is necessary for promoting health, and for continuing to be able to deliver high-quality health care in the future.