The Digital Health Cooperative Research Centre (DHCRC) has urged Australia’s Federal and State Governments to use their purchasing power more actively across the healthcare sector, with a particular focus on public hospitals.
The organisation, which works on advancing digital health innovation by linking academia, industry and government, said the health sector – which is one of the three largest areas of government spending – remains “fragmented and poorly integrated with state-based health services.”
It suggests procurement policy and processes are currently focused on cost minimisation and large-scale purchasing agreements, which is limiting opportunities for domestic businesses to compete and grow in Australia.
The DHCRC has urged governments at all levels to direct their spending to support local success stories, in order to drive local innovation and capability.
Annette Schmiede, CEO at DHCRC, said many of the organisation’s partners are unable to get a look in on local contracts and are often more successful offshore, which is leading to stifling of local innovation and creating sovereignty risk.
“Harrison.ai’s technology, for example, is accessible to one out of every two radiologists in Australia, representing strong leadership by the private sector, but by comparison has only been adopted by three public hospitals in Australia,” she said.
“We believe it is critical that public hospital procurement processes look beyond costs to other impacts of their spend – such as supporting innovation and the growth and sustainability of the local industry.”
This path would align with current national policies, says the DHCRC, including the National Digital Health Strategy.
“Incorporating such value-based procurement considerations, which move beyond price as the priority consideration in evaluating benefits, is essential for promoting health innovation, ensuring value for money and enhancing community wellbeing,” added Schmiede.
Australia was recently ranked first in the Commonwealth Fund’s Annual Report, with health science research ranked seventh globally.
The country was also ranked fifth in the World Index of Healthcare Innovation, with public hospitals accounting for close to one-third of total health expenditures which sit at $270 billion annually.
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