A view on canada healthcare sector and go to market strategy formulation

CANADA GOVERNMENT HEALTHCARE MARKET
(C) COPYRIGHT, 2015 SUMAN KUMAR MISHRA 1

PLEASE NOTE
The information in this slider is based on knowledge collected from Public Sources and insights from my experience in Healthcare
Sector. Most of the data synchs with conditions in 2015 – there might have been some recent changes to the ecosystem which
this report might not have captured.

AGENDA
 About Canada Healthcare
 Comparison with US and UK
 Canada Healthcare Market – Budget Trends
 Canada – Healthcare IT Market
 Appendix

ABOUT CANADA HEATLHCARE
MARKET

Introduction to Canada HC Market
 Canada is a high-income country with a population of 33 million people.
 Life expectancy in Canada continues to rise and is high compared with most countries
 Infant and maternal mortality rates tend to be worse than in countries such as Australia, France and Sweden
 About 70% of total health expenditure comes from the general tax revenues of the federal, provincial and territorial
governments.
 Most public revenues for health are used to provide universal medicare (medically necessary hospital and physician
services that are free at the point of service for residents) and to subsidize the costs of outpatient prescription drugs
and long-term care.
 13 public single-payer insurance schemes (one for each province) that are distinct but similar.
 The governance, organization and delivery of health services is highly decentralized, with the provinces and
territories responsible for administering medicare and planning health services.

Fiscal Federalism
 The Federal Government has a largely fiscal role, due to its spending power
 Federal government was responsible for maintaining ‘Peace, Order and Good Governance’ (POGG). Federal government
is responsible for…
 Food, pharmaceutical, consumer product, and health technology regulations and standards (Health Canada)
 The maintenance of a national health information database (CIHI)
 Public health and infectious disease surveillance (PHAC)
 Maintains a national ‘minimum standard’ of medically necessary services that must be insured under provincial health
insurance plans
 Health accords are negotiated every 10 years to determine its financial contribution to the provinces. Historically, it
included cash transfers and/or giving provinces ‘tax room’
 The 2014 Govt. decided not extend the Health Accord and it expired in 2014
 Funds from the Feds are contingent on provinces adhering to the Canada Health Act

Governance of Healthcare
 Federal Government
 Canada Health Act
 Health protection
 Research (Canadian Institutes of Health
Research)
 Cash transfers and/or giving provinces ‘tax
room
 Regional Health Authorities
 Funding allocation
 Needs assessment
 Professional Regulatory Bodies
 Licensure
 Discipline
 Provincial/Territorial Governments
 Policy-setting (e.g., def. of insured
services)
 Funding
 Health professional regulation
 regulation of hospitals
 Hospitals and Agencies*
 Program delivery
 Quality assurance
 Physician privileges
*Note these would be subsumed under regional health authorities in most jurisdictions.
Governance, organization and delivery of health services is highly decentralized for at least three reasons: (1) provincial (and
territorial) responsibility for the funding and delivery of most health care services; (2) the status of physicians as independent
contractors; and (3) the existence of multiple organizations, from RHAs to privately governed hospitals that operate at arm’s length
from provincial governments

Structural Profile Of Public Health In Canada
# Province Health Authority Number of Hospitals
1 British Columbia
• Fraser Health Authority
• Interior Health Authority
• Northern Health Authority
• Vancouver Coastal Health Authority VancouverIsland Health Authority
108
2 Alberta • Alberta Health Services 91
3 Manitoba
• Interlake-EasternRegional Health Authority
• Northern RegionalHealth Authority
• SouthernHealth/Santé Sud
• Prairie Mountain Health
• Winnipeg Regional Health Authority
13
4 New Brunswick (N.B.)
• Horizon Health Network
• Vitalité Health Network
23
5
Newfoundland and
Labrador
• Eastern RegionalHealth Authority
• Central Regional Health Authority
• Western Regional Health Authority
• Labrador-Grenfell RegionalHealth Authority
51
6 Northwest Territories
• Beaufort-Delta HSS Authority
• Dehcho HSS Authority
• Fort Smith HSS Authority
• Hay River HSS Authority
• Sahtu HSS Authority
• StantonTerritorial Health Authority
• Tlicho Community Services Agency
• Yellowknife HSS Authority
5
7 Nunavat • No regionalHA but there are 3 admin. regions: Kitikmeot Region, Kivalliq Region, and Baffin Region 9

Structural Profile Of Public Health In Canada
# Province Health Authority Number of Hospitals
8 Nova Scotia • Nova Scotia Health Authority 43
9 Ontario • 36 public health units 250
10 Prince Edward Island • Health P.E.I 8
11 Quebec
• Horizon Health Network
• Vitalité Health Network
331
12 Saskatchewan
• Cypress RegionalHealth Authority;
• Five Hills Regional Health Authority;
• Heartland RegionalHealth Authority;
• Keewatin Yatthé Regional Health Authority;
• Kelsey Trail Regional Health Authority;
• Mamawetan Churchill River Regional Health Authority;
• Prairie North Regional Health Authority;
• Prince Albert ParklandRegionalHealth Authority;
• Regina Qu'Appelle Regional Health Authority;
• SaskatoonRegionalHealth Authority;
• Sun Country Regional Health Authority;
• Sunrise Regional Health Authority
95
13 Yukon
No regionalhealth boards. The Yukon Departmentof Health and Social Services handles the operation of 1 hosp
and 14 Comm Health Centres in the Yukon 7

Provinces and Territorial health ministries
 Newfoundland and Labrador - Department of Health and Community Services
 Prince Edward Island - Department of Health and Wellness
 Nova Scotia - Department of Health and Wellness
 New Brunswick - Department of Health
 Quebec - Ministry of Health and Social Services
 Ontario - Ministry of Health and Long-Term Care
 Manitoba - Manitoba Health
 Saskatchewan - Saskatchewan Health
 Alberta - Alberta Health and Wellness
 British Columbia - Ministry of Health Services
 Yukon - Yukon Health and Social Services
 Northwest Territories - Department of Health and Social Services
 Nunavut - Department of Health and Social Services

CANADA – COMPARISON WITH US
AND UK

Ranking Of HC System On Performance
Parameters Canada U.S.A UK
Overall Ranking (2013) 10 11 1
Quality Care 9 5 1
Access 9 9 1
Efficiency 8 11 1
Healthy Lives 8 11 10
World Health Organization and OECD conducted this for 11commonwealth countries includes U.S.A, UK, Canada
Canada lags in Access and Quality Care but has better healthy lives than UK and U.S.A

Healthcare Spending :How Canada Compares
Parameters Canada U.S.A UK
Funding: Public Sector
contribution to total
71% 48% 84%
$ per Capita/ year
4602 8745 3289
% of GDP
10.9% 16.9% 9.3%
Commonwealth Fund has ranked U.S.A, UK
and Canada among other common wealth
countries and came up with this ranking
Source: The Commonwealth Fund
Canada ranks in between U.S.A and UK. U.S.A spends more on HC both in terms of per capita and % of GDP – while the public sector
contribution is least . UK is on other side of spectrum

Unlike U.S.A - Age Not Affecting The Spend
NOT MUCH. The age group (65+) has increased from 12.7% to 14.9% but the spending overall by this group has only marginally increased from 44.5% to 45.2%
Source: National Health Expenditure Database, Canadian Institute for Health Information

CANADA HEALTHCARE MARKET – BUDGET TRENDS

Canada Health Care Overview Numbers that matter
$171 Billion: Total HC spending
$4836: Per Capita Per Year
11%: HC expenditure as % of GDP
12%: Employed in HC industry
1984
Where Health “$” is spent (2014)
Public and Private Funding Split across components
71% Overall % of Public Spend in HC
Under Lester Pearson's Liberal government, Canada's health care
was expanded through the Medical Care Act, to provide near
universal coverage to all Canadians

Canada Govt. HC IT & Hospital IT Spending
Data Sets
• U.S.A Hospital Spending is 32% of HC Spending (Source: CMS ) – similar to Canada
• Hospital IT Expense is 3.92% (both CAPEX and OPEX) and 3.68% (OPEX only) of total Hospital expenses in
U.S.A (HIMSS)
• Govt. funds 71% of Canadian Healthcare (CIHI)
Assumption
- Canadian Hospitals will have the similar IT need as U.S.A: % of expense of IT in Hospital spend (OPEX) would be 3.68%
Conclusion
- Govt. budget for IT in Canada Hospitals could be = HC Spend for 2014 * Govt. Funding Share * Hospital Share * IT Share
= $171 Billion * 71% * 30% * 3.68% = $1.43 Billion
“40% of Total provincial / territorial government program
expenditure were allocated to healthcare in 2013”
(Source: NHEXT)1
2
Canada Govt. HC IT Budget would be around $2.24 Billion3

OTHER USE OF GOVT. FUNDS APART FROM HOSPITALS
 Physicians
Some of the Physicians directly bill to provinces, while others are
employed by hospitals. Their expenses are covered in Hospitals
section
 Other Institutions
Nursing homes and residential care facilities
 Drugs
Retail sales of prescribed and no prescribed drugs
 Public Health
Food and Drug Safety, Health inspections, health promotion
activities, community mental health programs, public health
nursing, measures to prevent the spread of communicable
disease, occupational health to promote and enhance health
and safety at workplace
 Other Health Spending
Health research, Medical Transportation
 Capital
Construction, machinery, equipment and some software of
hospitals and clinics, first aid stations
 Administration
Cost to operate health departments
 Other Professional
Dental and Vision care professionals
46.7
27.1
12.1
9.8 8.6 8.0
5.2
2.2 1.5
Hospitals Physicians Other Institutions Drugs Public Health Other Health
Spending
Capital Administration Other Professionals
GOVT. SPENDING (BILLION USD)

HC SPENDING OVER THE YEARS AND PROJECTIONS
HealthCare Spending ( US $ Bln)
 HC Spending year on year from 2006-2015 ( source: Epsicom, Economist
Intelligence Unit)
 From 1998 to 2010: HC spending outstripped GDP growth in each year
 Since 2012: HC spending declined compared to growth of GDP
 PBO Forecast ( 2087) of HC as % of GDP spend would rise up to 13%
from current 11 %
(Source: Office of Parliamentary Budget Officer)

HOSPITAL SHARE OF PUBLIC SECTOR HEALTH EXPENDITURE

HOSPITAL SPENDING: PROVINCES / YEAR ON YEAR TREND
-10.00
-5.00
0.00
5.00
10.00
15.00
20.00
25.00
30.00
35.00
40.00
45.00
Alta. B.C. Man. N.B. Nfld. N.S. N.W.T. Nun. Ont. P.E.I. Que. Sask. Y.T.
Hospital Spending (% Annual Change)
2009 2010 2011 2012 2013 2014

HC IT FORECAST(PUBLIC & PRIVATE)
Projected Annual Spending in Healthcare Technology($m)
Spending ($m) 2012 2013 2014 2015 2016 2017 2018 2019 CAGR 2013-19
Canada 3,497 3,702 3,950 4,237 4,548 4,835 5,130 5,373 6%
0
200
400
600
800
1000
1200
1400
1600
1800
2012 2013 2014 2015 2016 2017 2018 2019
RCM
Patient admin
PACS
e-Pres
EHR
BI & Analytics
Projected Annual Spending in Clinical Apps($m)
Source :Ovum
RCM :Revenue cycle management(includes billing)
PACS :Picture, Archiving and communication
e-Pres :E- prescribing
EHR :Electronic Health Records

HC IT FORECAST(PUBLIC & PRIVATE)
Source :Ovum
Clinical Apps 2012 2013 2014 2015 2016 2017 2018 2019 Grand Total
BI & Analytics 75 92 113 127 164 202 244 268 1285
EHR 224 250 281 321 354 392 431 470 2722
e-Pres 99 108 118 131 144 159 169 182 1111
PACS 186 198 208 223 236 251 262 273 1837
Patient admin 87 100 118 140 161 187 217 238 1248
RCM 112 127 143 162 183 205 225 245 1402
Grand Total 783 875 980 1104 1242 1396 1549 1676 9604
Projected Annual Spending in Clinical Apps($m)
%age contribution 2012 2013 2014 2015 2016 2017 2018 2019
Average %
contribution
BI & Analytics 9.57 10.51 11.53 11.50 13.20 14.46 15.75 15.99 13.37
EHR 28.60 28.57 28.67 29.07 28.50 28.08 27.82 28.04 28.34
e-Pres 12.64 12.34 12.04 11.86 11.59 11.38 10.91 10.85 11.56
PACS 23.75 22.62 21.22 20.19 19.00 17.97 16.91 16.28 19.12
Patient admin 11.11 11.42 12.04 12.68 12.96 13.39 14.00 14.20 12.99
RCM 14.30 14.51 14.59 14.67 14.73 14.68 14.52 14.61 14.59
Percentage Comparison of Clinical Apps

CANADA – HEALTHCARE IT MARKET

HOW CANADA STANDS: HC IT ADOPTION
A survey conducted by Accenture (500 doctors in Canada) found the following for U.S.A. Canada and UK
HealthCare IT functionalities
U.S.A Canada UK
P S P S P S
Use Electronic Tools to reduce administrative burden( ex:
Scheduling, Billing)
60% 62% 53% 47% 47% 25%
Patient notes entered electronically during or after consultations 58% 59% 42% 29% 91% 16%
Receive electronic reminders / alerts while am seeing patients 35% 33% 20% 13% 84% 7%
Use Computerized decision support system to make diagnostic
and treatment decisions while seeing the patient
19% 22% 18% 11% 28% 13%
HC IT Adoption- average 43% 44% 33% 25% 63% 15%
 Canada has more IT adoption in primary care than in secondary care ( like UK)  Canada doesn’t have vast discrepancy in IT Adoption between primary and secondary care
 P: Primary Care  S: Secondary Care

A NOTE ON GOVT. OWNED HC IT SYSTEMS
 Financial Systems: Example Claims processing are owned by Govt.
 Govt. however outsources these services to Canadian IT companies
 Companies who manage Govt owned HC IT Systems
 TELUS, for the province of Ontario
 IBM, for smaller provinces
 Deloitte, for BC
 Oracle, for BC
 Medavie, New Burnswick
 Prime importance to data not moving out of country, so companies with offices and DC in Canada are
preferred over those working out of USA over those from India or other destinations
 Preference towards those companies who have Canadian story, example customers served, regions present,
impact made within Canada

OVUM: AWARDS IN GOVT. HC (JUNE,2014 - PRESENT)
Client
Name
Primary
Vendor
Deal Date Contract Length
(months)
TCV
($m)
Bid Type IT Service Type Description of components Part of large contract
Government
of Ontario
CrimsonLogic 13 Jan 2015 36 6.0 Competitive Application
development and
support; IT Consulting
Selected Vendor of Record (Task based I&IT
Services and I&IT Solution Consulting Services)
Yes
Shared
Services
Canada
IBM Corp 08 Oct 2014 36 24.0 Competitive Data center
outsourcing;
Infrastructure
management;
Maintenance/support
To provide and manage enterprise data center
space
No
Government
of Alberta
Fujitsu Group 08 Sep
2014
120 30.0 Competitive Business
continuity/disaster
recovery; Helpdesk
management;
Maintenance/support
Manage and Operate Service Desk Services
for all ministries of Provincial government
Yes
All of these awards were won on Fixed pricing
Non HC – there are more opportunities here
 Recruitment - MSA (Saskatchewan)
 Review Process, Portal development, Analytics, Project Management
(Alberta Public Sector)

MERX: RFP’S AWARDED IN HC (MAY,2014 - PRESENT)
Client Name Primary
Vendor
Deal
announceme
nt Date
Contract
Length
(months)
TCV
($m)
IT Service Type
Rouge Valley Health
System
Gribaltar Feb, 2015 N/A N/A Provision Of Citrix Software Refresh And
Implementation
Ontario Shores Centre
for Mental Health
Sciences
NA Feb,2015 N/A N/A Endpoint Protection/Security Antivirus Software
St. Joseph Health
Center
Deloitte Jan, 2015 N/A N/A External Financial Audit Services
Northwest Supply ChainMNP LLC Dec, 2014 N/A N/A Virtual HC Current State Analysis and Roadmap
Lakeridge Health
Corporation
Deloitte Dec, 2014 N/A N/A Provision of Facilitation and Advisory Services to the
CEO and Board of Trustees
Northwest Supply Chain3M Canada Sep,2014 N/A N/A Coding and Abstracting Software Solution and Annual
Maintenance
Manitoba Infrastructure
and Transportation
SAP Sep, 2014 N/A N/A SAP Business Object Renewal

PLAYERS – HC IT CONTRACTS IN CANADA
CGI
 ECM, Diagnostic Imaging shared services, Chronic Disease Management, Claims System
Management, HIX, Health Informatics, Application Development , AVM
 Ministries of Health in some provinces and Health Canada,
 ERP and IT operations to provincial hospitals and regional systems
Accenture  Cloud, Analytics, ehealth, Connected health
Deloitte  e-Health
PWC
 Integrated Service Delivery, Shared Back office Services, Digital Backbone, Infrastructure and
Service Delivery
IBM
 Analytics, Disease Surveillance and monitoring system
 Care Management Platform for Hospital
KPMG
 Service Integration, Business Performance Improvement, ehealth, Public and Private Sector
Partnership, Shared Services, Program Management,
E&Y
 Remote Patient Monitoring , HealthCare Advisory Services, Transformation, Analytics, Program
Management, Workforce , System design, AVM, ehealth

HC’S NEXT WAVE OF REFORM
 Healthcare Clouds - Healthcare clouds will help providers access and store information in more efficient, flexible and secure ways while
helping save money—driving the push toward physician electronic medical records. For patients and consumers, healthcare clouds will
be a platform for personal health records, offering new access, control, visibility and convenience.
 Health Analytics - Together, advanced analytics and new data visualization techniques will help unlock the power of data to drive more
informed decision making and, ultimately, higher quality, lower cost care—from public health monitoring and prevention to the
treatment of chronic illnesses.
 New Payment Models - The convergence of health reform, new data availability and access, and the push to lower healthcare costs will
drive the shift toward outcomes-based funding in Canada and around the world. New funding models will be linked to meeting specific
targets, adjustments for patient case mix and other measures related to achieving quality outcomes.
 Tablet Computing - Easy-to-use and portable, tablet computers will play a critical role in unlocking clinical adoption of technology, like
physician electronic medical records.
 m-Health - Mobile technology and mobile apps have become a part of everyday life for many people. Bant, developed in Canada, is
one of the new class of apps simplifying diabetes management. Users can record their glucose readings, link to popular health accounts
and share information.

HC’S NEXT WAVE OF REFORM
 Social Networking - the next wave of opportunity will be around patients managing and “curating” healthcare information via social
networking sites. Consumers will be able to access trusted sources and reliable information that reflects patient needs.
 Point-Of-Care Diagnostics - Recent advances toward “lab on a chip” allow for thousands of tests to be run on just a few drops of
blood. PoCTs will continue to simultaneously drive consumer empowerment and improve care with the ability to provide reliable and
“instantaneous” results without the need for a large centralized lab.
 Hospital at Home - Technology advances will continue to enable more hospital at home options for diagnostics, the care of chronic
conditions and postsurgical recovery
 Regionalization - The emergence of these larger regional systems along a centralized governance model and stable funding will
continue to enable better integration. Key benefits will include the consolidation of systems, standardization of care protocols and the
development of shared service models or managed services contracts.
 Exporting Health - Healthcare organizations outside of Canada are entering new markets - foreign markets in particular—in an
attempt to generate new revenue. Opportunities include partnerships, licensing deals, expansion into new markets and
commercialization of IP.

STATE PROCUREMENT LINKS: CURRENT OPPORTUNITIES
# Client name Opportunity Description LINK
1 The Ministry of Health
and Long-Term Care
To gather information from the marketplace for a Commercial Off-The-Shelf
(COTS) solution in order to assist in the determination of future system
options and requirements. The COTS solution, once determined and procured
through an open and competitive procurement process, would replace the
Ministry’s existing Data and Voice Recording and Retrieval (DVRR) solution.
ONTARIO
PROCUIRE
MENT
LINK
2 British Columbia Wasn’t able to find any hospital or health related services we can pitch for None
3. Nunavut Wasn’t able to find any hospital or health related services we can pitch for None
4 Alberta Wasn’t able to find any hospital or health related services we can pitch for None
 Biddinggo.com – we have to reactivate this account
 Procurement links for BC, Ontario
 SSO and HA Procurement links
 Partner with CanadaHealth Info way
 Register for Federal procurement link
Other Opportunity Sources

CHALLENGES FOR GO TO MARKET

SOME OF THE PROBING QUESTIONS
Do you have a Canadian Story ?
What are your accreditations ? What is your
positioning in the Value chain ?
What are your Legal Arrangements ? Are you targeting the right customer ?

IT SOLUTIONS & PRODUCTS IN CANADA HC MARKET
 Mobility and Desktop virtualization
 Players: IBM, Accenture
Cloud
 Enables federal agencies, healthcare regions and large health
institutions to address pressing issues such as increasing costs, poor or
inconsistent quality of care, and inaccessibility to timely care
 Players: IBM, Accenture, Mobility Plus app
Health Analytics
 An online platform that enables pharmacists to better
communicate and collect information from patients, as well as offer a
series of value-added services to help them stay healthy.
 Players: TELUS Ubik
Pharmacy Management Systems
 Better asset availability, automation, OPEX,reduction for hospitals
 Players: IBM, PwC, CGI
Application Maintenance and Support
Latest Solutions in
Healthcare IT space
 Access patient charts and electronically co-sign
orders remotely. Send and receive secure HIPAA-compliant
text messages on mobile devices. Archive conversations and
update patient records directly
 Players: Pocket Echo
Practitioner Engagement
 Allows users to enter and review medication, lab, diagnostic,
diet and non-medication orders electronically. Point of Care Diagnosis.
Hospital at home
 Players: IBM, Accenture, E&Y, KPMG
Patient and Consumer Health Platforms / Mobile Apps (mHealth)

SOME VERY BROAD
RECOMMENDATIONS

Ontario
Quebec
Alberta
BC
Manitoba
French widely spoken- language
barrier
“The best strategy to enter Canada market is province by province. Each of the provinces or territories have different procurement capacities,
sales cycles, preferred vendors, opportunity areas and regulations. Market entry strategy for Canada should therefore be province by province
– and considering competitors in those areas“
Top 5 Provinces
Given the healthcare structure in Canada, recommendation is to have entities focused on Public Sector /
Government and in Provider business to make joint pitches
MARKET ENTRY RECOMMENDATION: PROVINCE WISE STRATEGY

POSSIBLE PARTNERS
Provided on Request
Provided on Request
Provided on Request Provided on Request

RECOMMENDED SSO’S TO PARTNER WITH
Intentionally left
BLANK

COUNTER STRATEGY TO PLAYERS EYEING THIS MARKET
Intentionally left
BLANK

BUDGETING FOR THE GO TO MARKET EXERCISE
Intentionally left
BLANK

KEY SUCCESS FACTORS FOR THE GO TO MARKET EXERCISE
Intentionally left
BLANK

SUMAN KUMAR MISHRA
SUMANK.MISHRA@GMAIL.COM

A view on canada healthcare sector and go to market strategy formulation

Recommandé

Recommandé

Contenu connexe

Tendances

Tendances (20)

En vedette

En vedette (15)

Similaire à A view on canada healthcare sector and go to market strategy formulation

Similaire à A view on canada healthcare sector and go to market strategy formulation (20)

Dernier

Dernier (20)

A view on canada healthcare sector and go to market strategy formulation