This article was published on www.maverick-law.com
The year 2019 will present numerous challenges for both the Netherlands Authority for Consumers and Markets (“ACM”) and the Dutch Healthcare Authority (“NZa”). Questions regarding increasing healthcare costs, staff shortages in the healthcare sector, persistent waiting times, healthcare mergers and so on are putting pressure on the supervisory authorities. Expectations are high. The question is whether ACM and NZa will be able to cope with all these challenges.
Intensification of merger control to continue in 2019
ACM made suggestions in 2018 to submit certain healthcare mergers to a stricter test. Minister De Jonge of the Ministry of Health, Welfare and Sports is currently performing a further investigation as to whether healthcare mergers involving a party with significant market power can be prohibited. De Jonge has requested the Inspectorate for Health and Youth Care (“IGJ”) to investigate whether it can predict the quality and safety of healthcare after a merger. The Minister will return to this survey in early 2019. De Jonge himself is not in favour of a blanket ban on mergers that produce certain economies of scale or of obligating healthcare providers with a dominant position to hive off certain types of healthcare. Be that as it may, the recommended policy for merging care providers and investors in healthcare is to prepare an acquisition, merger or alliance with due care. ACM will further intensify merger control in the healthcare sector in 2019. ACM is increasingly focusing on the risks involved in hospital mergers. In 2019, ACM will also investigate the effects of mergers in mental healthcare (“GGZ”) and in homecare. Although this has not yet changed ACM’s statutory assessment framework, ACM is already displaying a very critically approach to healthcare mergers. ACM wishes data to play an even greater part in healthcare merger control. According to ACM, its healthcare merger control has been more in keeping with the demand among patients since December 2018. One of the obligations introduced by ACM is that the consequences of a healthcare merger for various groups of patients have to be identified in the ACM report form. ACM then investigates per separate product group the consequences of a merger of hospitals or independent treatment centres. Although ACM appears to be taking a more critical approach to healthcare mergers, the statutory assessment framework for healthcare mergers has not yet been changed. Also in 2019, healthcare mergers that lead to large joint market shares must be reported to ACM and, as in 2018, there will be cases in which they can nevertheless be approved.
Possible transfer of merger control from NZa to ACM in 2020
In 2016 already, a bill was introduced to no longer have healthcare mergers successively tested by the NZa and ACM. ACM is to perform both the healthcare merger test and the competition law test. More information on this proposed transfer and the proposed new (turnover) thresholds can be found here and here. If the Upper House of Dutch Parliament adopts this bill in 2019, the double healthcare merger test by the NZa and ACM will end at the earliest on 1 January 2020.
Abuse of a dominant position and compliance with the cartel prohibition by ACM
In the field of abuse of a dominant position, ACM will play a role in 2019 in particular in the field of expensive medicines; see this blog. In 2019, ACM will focus more than in the past on compliance with the cartel prohibition in the healthcare sector. ACM has already informed healthcare insurers that they must comply with the cartel prohibition when “consulting” during healthcare procurement. ACM recently clarified that it was monitoring General Practitioners (“GPs”) for compliance with the cartel prohibition. Survey results apparently show that one in five GPs refuse patients in breach of the competition rules. ACM chairman Snoep has announced that GPs will be fined if they do not change their behaviour. ACM has also emphasised in light of healthcare procurement competition rules of the National Association of General Practitioners (“LHV”) that competitors may work together also in respect of contracted care, but not in order to increase their negotiation power. More information on permitted cooperation among healthcare providers in contracted care in 2020 can be found at www.zorgcontractering.com. ACM will focus in 2019 not only on enforcement, but also on the provision of information. To remove obstacles in regional cooperation in the healthcare sector, ACM will publish a guideline this summer on cooperation in regional restructuring.
Reimbursement of non-contracted care: a hot topic in 2019
Also in 2019, the political call for restrictions on non-contracted healthcare will persist. The reduction of the reimbursement for non-contracted healthcare regularly gives rise to conflicts. The Ministry of Health, Welfare and Sport is currently working on a bill to regulate the reimbursement for non-contracted care, in particular in the fields of district nursing and mental health. The bill is expected in the last quarter of 2019. Until the bill is enacted, the reimbursement for non-contractual care must be based on case law. That case law provides that the reimbursement for non-contracted healthcare may not de facto constitute an “obstacle” for patients that limits their free choice of a GP. A “flat rate” (generic discount percentage) is not permitted, according to the court. The actual (procurement) costs per type of care must be taken into account in determining the reimbursement. Those costs are based on the weighted average of the rate actually charged for a specific type of care. The NZa informed healthcare insurers in 2018 that they must aim for transparency regarding the reimbursement of contracted and non-contracted care. In 2018, the NZa did not impose any fines in this file either. As we reported in 2018, the NZa is likely to impose fines in 2019 on repetition of this offence.
Credible NZa supervision of care insurers on healthcare procurement urgently required
The persistent lobby of Zorgverzekeraars Nederland (“ZN”) and healthcare insurers and the political pressure to limit non-contracted care has its downside. If healthcare providers require incentives to operate only on the basis of contracted care, an orderly contracting process and effective supervision of that process by the NZa make sense. That requires adequate enforcement of compliance by healthcare insurers with the NZa Transparency in the Care Procurement Process Regulations ("Healthcare Procurement Regulations"). Three years after the introduction of the Healthcare Procurement Regulations, it is apparent that healthcare insurers have minimal knowledge of these mandatory contracting rules. Repeated violations by several healthcare insurers of these mandatory NZa rules are no exception. In the paramedical care sector alone, the NZa received in 2018 more than 800 complaints regarding healthcare insurers from 385 different healthcare providers. This report and the complaints filed by oral care trade associations ANT and KNMT regarding healthcare insurer VGZ suggest that this list of the NZa is only the tip of the iceberg. In a number of files, the NZa is performing a further investigation into contracting by insurers. In 2019, the question in this regard is not whether but rather when the NZa will fine healthcare insurers. The NZa has already instructed them to improve healthcare procurement. Practice has shown these past few years that this will not be possible without fines as deterrents.
Even though the NZa lacks the capacity to enforce compliance with mandatory NZa rules by insurers, it recently requested additional powers in order to monitor healthcare providers. The NZa wishes to be able to enforce compliance with the Healthcare Governance Code by healthcare providers. In light of the persistent violations of mandatory NZa rules in healthcare procurement and the provision of information by healthcare insurers, the question presents itself why the NZa wishes to divert attention to the healthcare providers. Why does the NZa not (also) request the power to enforce the Code of Conduct for Healthcare Insurers? That code of conduct sets out the rules that healthcare insurers must follow in relation to healthcare providers and the insured. The NZa has known for years that healthcare insurers have repeatedly refused to comply with those rules; see here, here, here and here. If the NZa were unsuccessful in 2019 in enforcing proactive compliance with mandatory rules by healthcare insurers, such as the NZa Healthcare Procurement Regulations and the Regulations on the Provision of Information by Health Insurers to Consumers, the question again present itself whether the NZa is still the impartial and credible supervisory authority that it claims to be.
Waiting times and freedom of choice in healthcare: supervision of duty of care is crucial
The enforcement of the duty of care of healthcare insurers (Section 11 of the Healthcare Insurance Act), the cornerstone of our healthcare system, will become increasingly important in 2019. In 2018, the waiting time problems in mental healthcare, for instance, were not solved, despite the outline agreement, which sets out the aim to reduce waiting times. The maximum waiting times within which a patient must receive mental care (known as the Treek standards) are still being exceeded in many cases. The supervision by the NZa appears to be focused primarily on healthcare providers. In the NZa’s opinion, healthcare providers must more clearly communicate the healthcare waiting times. That is only part of the problem, because substandard contracting by healthcare insurers (such as imposing too low a turnover ceiling) is the essence of the problem. It therefore makes sense that State Secretary Blokhuis of the Ministry of Health, Welfare and Sports is aiming for adequate supervision by the NZa of correct compliance by healthcare insurers with the duty of care. In light of the systematic failure to meet the Treek standards, the measures that the NZa will take against healthcare insurers will have to be awaited also in that regard. The NZa cannot impose fines on healthcare insurers in enforcing the duty of care. When political patience runs out in 2019, the question is why the NZa has requested powers to enforce compliance with the Healthcare Governance Code by healthcare providers but has not requested the power to impose effective sanctions on violation of the duty of care by healthcare insurers. ACM recently demonstrated the importance of effective supervision of healthcare procurement, e.g. by enforcing the duty of care. ACM aims to increase the consumers’ freedom to choose a GP. ACM has also noted in that regard that investigation has shown that GPs refuse patients, because their practices are full. ACM does not appear willing to address the cause of that problem together with the NZa, as with regard to enforcing the duty of care. Lack of attention to this point will not be tolerated in 2019, in light of the current social and political pressure.