STANDARDISED AUTOMATION OF PRE-AWARD PROCUREMENT PROCEDURES IN HEALTHCARE

Transcription

1 STANDARDISED AUTOMATION OF PRE-AWARD PROCUREMENT PROCEDURES IN HEALTHCARE Andriana Prentza, Department of Digital Systems, University of Piraeus, Greece Lefteris Leontaridis, Department of Digital Systems, University of Piraeus, Greece Athina Stergiou, Gnomon, Thessaloniki, Greece Alexis Berler, Gnomon, Thessaloniki, Greece Kostis Kaggelides, Gnomon, Thessaloniki, Greece Abstract During the last years, ICT systems have become pervasive in business and most business processes are ICT supported in some way. Despite progress however there are still challenges for standardised electronic data transmission. The lack of a standard definition of ecatalogues across all EU countries is one of the existing or potential hurdles that all enterprises - and especially SMEs - face when trying to carry out cross-border public e-procurement transactions. Pre-award procedures in healthcare are still not fully automated due to the fact that the widespread use of electronic Catalogues in public procurement is not favoured by the current practices of the Contracting Authorities where they use their own formats requesting from suppliers to adapt the content of their electronic Catalogues. In this paper, we present a case study for the application of standardised ecatalogue specifications in the 4th Regional Health Authority of Macedonia-Thrace (DYPE). The pilot scenarios and use cases are described in details. Furthermore, sectoral healthcare requirements and specifications including the requirement of PEPPOL ecatalogue format and process alignment for healthcare are discussed. Keywords: eprocurement, pre-award ecatalogues 1 INTRODUCTION Using the Internet to transact business is becoming a standard trend in many sectors of the economy, including healthcare. The Internet can serve as an electronic marketplace, bringing together healthcare organizations and suppliers. eprocurement of goods in healthcare definitely provide value by managing expenses, introducing administrative efficiencies, and reducing costs. The European e-business Report 2008 [1] observed: a "trend towards digitally integrated value systems", with an increasing "importance of knowledge-intensive activities". ICT systems have become pervasive in business. In fact, "ebusiness" is probably no longer an adequate term to capture the general trend of applying ICT systems in commercial exchanges. In advanced companies, most business processes are ICT supported in one way or the other; a distinction between "e-business" and "traditional business" is no longer possible. However, even if the concept is being mainstreamed, some important issues remain to be addressed. These include technical and legal challenges for electronic data Andriana Prentza et al. 275

2 exchanges between companies, which limit the scope of the network effects and the resulting productivity gains. However according to the European e-business Report of [2], in order to advance ebusiness in Europe, a challenge still remains the creation of an optimal framework for advanced electronic data exchanges: some business processes, such as invoicing, are well suited to be digitised. However, there are still complex issues to be solved. The lack of a standard definition of ecatalogues across all EU countries is one of the existing or potential hurdles that all enterprises - and especially SMEs - face when trying to carry out cross-border public e-procurement transactions. Defining a shared standard for the presentation of ecatalogues should hence enhance both the creation of wider market opportunities and the uptake of ICT in procurement procedures [3]. In general, across Europe the current use of ecatalogues is primarily limited to the post-awarding phases of public procurement, where ecatalogues are used to enable electronic ordering and invoicing; there is not a use wide of standards (in content and in processes) to manage ecatalogues; and there is not a widespread use of automatic tools to manage ecatalogue contents and formats (the process is offline and often hand-managed). In terms of automation of processes in both ends of the electronic procurement, there are some issues that need to be addressed and resolved before ecatalogue adoption in pre-award happens: Creation of electronic tenders or electronic catalogues using the product classification information provided in the call for tenders. Evaluation of electronic tenders by contracting authorities, matching classification schemes for offered items with classification schemes for required items. Enabling the use of one-off electronic catalogues for tender submission. Identification of product classification schemes within electronic documents data models. Item classification schemes mapping. Resolving those issues will enable economic operators to create tenders directly from their catalogue systems, and will facilitate the use of those electronic catalogues in electronic procurement systems by contracting authorities [6]. The European Commission s CIP programme large scale pilot project PEPPOL is a major crossborder eprocurement initiative intended to provide standards-based IT infrastructure and services to set up and run pan-european public procurement operations online. PEPPOL supports the implementation of highly efficient business and public procurement by paving the way with best practice content standards, common processes and an open exchange infrastructure across Europe. It will help reduce administration costs and can thus support the austerity plans of national governments. PEPPOL will facilitate the electronic exchange of orders, invoices, and catalogues between buyers and suppliers in different Member States or eprocurement communities. It also includes the classification of goods and services and the submission of company attestations required for bidding [3]. Regarding catalogues, the PEPPOL project aims to strengthen the use of ecatalogue for achieving efficiency gains in the pre-awarding phases of public procurement, where ecatalogues assume the role they were traditionally intended to play in the brick and mortar world, i.e. to constitute documents detailing available products and prices. The challenge of the use of ecatalogue in public procurement could be probably stated as follows: The widespread use of electronic Catalogues in public procurement is not favoured by the current practices of the Contracting Authorities, who have the habit to create own formats, managed with ad hoc tools, thus requiring economic operators to adapt the content of their electronic Catalogues. In the hypothesis that ecatalogues are used in pre-award, many economic operators have to readapt their ecatalogue to the tender specific template; out of the submitted ecatalogues, only one (or a few, in the case of Framework Agreements) will be reused the contract, while the effort of the other economic operators will be lost. ([4]) Andriana Prentza et al. 276

3 A shared and actually used ecatalogue standard will push economic operators to invest into the creation of an electronic prospectus of their offer, because it can be re-used for different tenders and across more sectors. This will benefit most of all SMEs, for which the fix costs to create an ecatalogue have a higher weight on their business. At the same time, open source solutions will benefit a large number of public administration small offices, which do not have budget for the purchase of proprietary eprocurement applications or softwares, and/or the installation thereof, and very often do not have even the know-how to choose the right market solution. PEPPOL has developed an ecatalogue Management Tool in order to support Public Administrations (as Contracting Authorities CA) and Economic Operators (ecop) in designing and managing ecatalogues. The main features of the ecatalogue Management Tool are related to the standardization of procedures, formats and contents in order to simplify Catalogues exchange between Businesses and Administrations. For the pre award creation of ecatalogues, the tool complies with a PEPPOLdefined profile which represents the basis for the standardization work brought forward by the CEN/BII 2 Workshop with a new data model used for pre-award ecatalogues [6]. Focusing on procurement issues in healthcare, public healthcare organisations currently run procurement systems using traditional means of communication and administrative practices mainly a paper-based system of notification, dissemination and tendering. As stated in Francesco Bof et al in 2007 only 21% of Italian Healthcare organizations are using some type of e-procurement solution, mostly at the initial stages of e-procurement acceptance [7]. This is mostly due to several sectoral related issues as stated by A. Berler et al [8]: 1. The rapid technological changes in medical and pharmaceutical technologies are leading to the devaluation of material stocks in healthcare organization. This means that procurement procedures need to be more efficient and executed in a timely manner. 2. Biomedical materials and medical equipment are characterized by enhanced complexity thus making the tender process more complex to describe functional and technical specifications, more difficult to keep the national and European rules concerning unfair competition and tedious to engage economic operators in making financial offers that keep up with the general public interest. 3. The social factors and patient centered character of the healthcare sector demands that strategic stocks are always present to safeguard public health. 4. Many materials are one of a kind, drugs are patented for many years and the immediate delivery of them to patients requires various procurement models to be in place so that patient safety is ensured. 5. Specific nomenclatures such as GMDN (global medical device nomenclature) are used to streamline the procurement process and ensure product classification and control in accordance to EU and National medical device regulations. The European commission has funded a series of project to deal with the abovementioned issues. OPUS (Optimal Public Procurement in the Healthcare Marketplace , IST ) and EPOS (E-Procurement Optimised System For The Healthcare Marketplace, , eten) are just two examples. [9], [10] In this paper, we present a case study for testing a solution where the PEPPOL ecatalogue BIS (Business Interoperability Specifications) are being implemented to manage ecatalogues used in the frame of public procurement procedures in the 4 th Regional 4th Regional Health Authority of Macedonia-Thrace (DYPE). The pilot is still in implementation phase and the results of the pilots will be reported in the future. A PEPPOL BIS is a technical specification describing [11]: The Legal scope of the specification. The Organization/Business scope of the specification. Andriana Prentza et al. 277

4 The choreography of the business process(es) covered, i.e. a detailed description of the way the business partners collaborate, play their respective roles and share responsibilities to achieve mutually agreed goals with the support of their respective information systems. The electronic business transactions exchanged as part of the business process and the sequence in which these transactions are exchanged. The business rules governing the execution of that business process(es), its business collaborations and business transactions, as well as any constraints on information elements used in the transaction data models. The information content of the electronic business transactions exchanged by referencing a common data model for each of the business transactions. The technical implementation of the business specifications and semantic specifications. Relationships with the PEPPOL esignature and Transport Infrastructure. This paper is divided into four sections including this introduction. In the second section we describe the Greek case study including an overview of the current situation in Greece, a short description of the eprocurement System of DYPE, and the pilot scenarios and use cases. In the third section we discuss sectoral healthcare requirements and specifications including the requirement of PEPPOL ecatalogue format and process alignment for healthcare. Finally, in the fourth section the conclusions and future work are presented. 2 THE GREEK CASE STUDY The specific case study described in this paper includes the 4th Regional Health Authority of Macedonia-Thrace (DYPE) in Greece which manages the procurement for hospitals and other public health care units of its authority region (Macedonia and Thrace). In particular it covers 14 Hospitals, 35 Health Centres, 232 Peripheral Infirmary Units and 16 welfare centres. DYPE has developed a regional health e-procurement system which is a dynamic procurement system and supports the public procurement processes in the health sector and their specific requirements based on Greek national legislation and the EU Public Procurement Directive 1. The primary procurement process is the issuing by the DYPE of a call for tenders for certain items based on forecasts and budget availability. The Authority nominates a responsible hospital as procurement manager to prepare, manage and publish the calls for tenders using the application. This process includes sub-processes including the tasking of other hospitals, gaining internal approvals, collating the total requirements, gaining the approval of the Authority and, finally, publishing the call for tenders. It should be noted that each hospital may use their own internal processes for gathering information to be included in the call for tenders and gaining local approvals. These activities may include the delegation of responsibilities to department and sub-department managers, the application and supporting processes accommodate these activities. Adopting a dynamic purchasing system to manage the preparation and publication of calls for tender provides the following advantages: Reduces the preparation administration and management burden; Improves the speed of preparation; Improves the accuracy of preparation; Improves the flexibility of the data which, over time, can be used to more accurately predict consumption and forecast requirements. 1 DIRECTIVE 2004/18/EC OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 31 March 2004 on the coordination of procedures for the award of public works contracts, public supply contracts and public service contracts Andriana Prentza et al. 278

5 Additionally, the system supports standard international codification nomenclatures for medical equipment and reactive agents (GMDN 2, EDMA 3 ) providing full interoperability with the certified products database developed and maintained by EKEVYL as well as with the business systems of the participating care units (hospitals). EKEVYL is an Organization for the Certification of Quality Management Systems and is the Hellenic Notified Body for medical devices within the European Union. The database developed by EKEVYL is a codification database of all medical devices circulating or possibly existing within the Hellenic market and which are subject to the European Union Directives (93/42/EEC, 98/79/EEC, 90/385/EEC) and the respective harmonization directives of the Hellenic legislation. This database is mainly used by the Greek Regional Health Care Authorities, the Greek Public Authorities that manage the procurement procedures in the health sector. EKEVYL provides them the e-catalogue schema for medical devices. Health Care Authorities uses this schema for formulating the specifications for call for tenders concerning those items. EKEVYL has also implemented and maintains a database of all manufacturers and suppliers medical devices in circulation within the Hellenic market. In the specific case of healthcare public eprocurement there are the following domain specific idiosyncrasies in the area of electronic catalogues: The complexity of the domain. Healthcare devices are a complex domain comprising of several hundreds of thousands of products aggregated in hundreds of general product categories. The use of ecatalogues as point of common reference between administration and the medical personnel further enhances process complexity on healthcare eprocurement. The existence of compliance governing bodies (specifically in the field of Healthcare) like the GMDN agency as well as national CE authorities (like EKEVYL). The necessity to describe products using textual description (avoiding product brand names and other identifiers that might lead to specific manufactures and thus limiting competition). The existence of nationwide suppliers registries and products codification databases. 2.1 Overview of current situation in Greece Currently there is no official etendering solution for all public authorities in Greece. Most procurement procedures still take place in an offline way, (submitting offers by paper and/or CD- ROM). In some cases Contracting Authorities have been using stand-alone applications in order to prepare the template documents that should be filled in by Economic Operators. Lately, online eprocurement has started to appear, using either commercial suppliers (mainly for eauctions) or the few production-ready eprocurement systems that have been finalized and are available, notably in the healthcare sector. Currently in Greece there is a legacy classification system in use. CPV (Common Procurement Vocabulary developed by the European Union for public procurement for categorizing items that are subject of public call for tenders) is used to classify calls for tenders according to the relevant EUlegislation). Several Contracting Authorities are using their own classification systems to categorize the items that are subject of public call for tenders. 2.2 eprocurement System of DYPE DYPE has recently launched a new web application for managing the eprocurement process for the Hospitals in the region of east Macedonia and Thrace. The DYPE procurement system is comprised of the following subsystems: 2 Global Medical Device Nomenclature which is a comprehensive system of internationally recognised coded descriptors in the format of preferred terms with definitions used to generically identify medical devices and related health care products ( 9 th March European Diagnostic Manufacturers Association ( Andriana Prentza et al. 279

6 1. ecatalogues: Multiple catalogue management through a user friendly graphical user interface with multiple search capabilities. Catalogues can be linked between them, can be linked with products codes used in hospital enterprise resources management systems (ERP). 2. especifications: The system handle complex technical and functional specifications related to products and materials. This enables DYPE to issue group buying eprocurement processes with common specification for more than one medical institution. 3. eplanning: the system is able to gather procurement requests based upon an analytical organizations charts with multiple approval processes. Procurement planning can be done is any procedural manner chosen. Early programmes are applicable by law in Greece. After having created a procurement plan, the selected contracting authorities (DYPE and or the Hospitals) can execute, monitor and manage their tenders and tenderers. 4. esuppliers: the system support the creation of an economic operators register. This allows both economic operators and contracting authorities to interact on issues concerning the procurement processes in the Region managed by DYPE. Economic operators get instant information while contracting authorities can invite them to tender by any legal means described in the Greek procurement laws and regulations. 5. econtracts:the system is able to follow up and manage contracts created through the systems and assist the contracting authorities in keeping contract milestones, follow budget issues, material management, delivery dates and stock control. The DYPE procurement system provides the following catalogue-related functionality: Usage of common and standardized catalogues of items among all hospitals. Catalogues are based on GMDN classification. CPV is also included in order to be compliant with the European legislation regarding the procurement process in public sector. Catalogue functionalities include the definition and usage of common specifications among hospitals. The native modality used is Excel. 2.3 Pre-award ecatalogue pilot in DYPE The case study presented in this paper describes the pre-award scenario for ecatalogues. 4th DYPE is the contracting authority used in the pre-award scenario. The existing eprocurement system of 4th DYPE is currently being extended with Validation and Transformation components needed to implement the PEPPOL pre-award scenario. The following pilot stages are foreseen: Stage A: Initially, at a pre-production stage, the tools provided by PEPPOL will be used by both contracting authority and economic operators in order to perform dry runs of previously issued tenders. Stage B: At production stage, live tenders will be run with international economic operators where available Below the pre-award pilot scenarios and related use cases are being described. 2.4 Pilot Scenarios and Use Cases Stage A: pre-production In the pre-award scenario, a tender that has already been issued by DYPE using its eprocurement system, will be replicated with a dry run. In the dry run, DYPE (the Contracting Authority) will redescribe the items that were subject of this tender using the CA (Contracting Authority) tool (see Figure 1) in order to create the catalogue template. The catalogue template will follow the CEN/BII2 catalogue profile. The supplier will create a catalogue according to the above template using the ecop (Economic Operator) tool provided by PEPPOL. The economic operator submits the catalogue using the ecop tool through the PEPPOL Infrastructure. The contracting authority receives the document and uploads Andriana Prentza et al. 280

7 the catalogue to the procurement system. The document is being transformed. The CA is able to view the contents of the catalogue. Catalogue template Creation using CA Tool CA Tool Contracting Authority Catalogue creation ecop Tool PEPPOL Infrastructure (Transmission of the template to the ecop) Economic Operator Catalog Submission Catalogue Validation and Transformation DYPE eprocurement System Figure 1: Test pilot Pre award procedure Stage B: production In the production, pilots real tenders will run or used. Due to different issues described in previous paragraphs regarding the current situation, the whole process will be a mix of both electronic and nonelectronic means. In the pre award phase, DYPE creates a tender including a catalogue template using its own procurement system. Items in catalogue template are classified using the GMDN and CPV classification systems. The created template is being transformed to a PEPPOL format. The tender and the catalogue template are being published in DYPE s procurement Portal. The supplier downloads all necessary files including the catalogue template. The supplier creates the catalogue using the ecop tool provided by PEPPOL according to the catalogue template issued by the CA. The catalogue together with all necessary files are submitted by the supplier offline, in a non-electronic way (sealed offer submitted by postal services). The catalogue submitted by the supplier is uploaded in DYPE s procurement system. The catalogue is being validated according to the national and PEPPOL rules. Upon validation it is being transformed to DYPE s procurement system in an accepted format. DYPE reviews the submitted catalogue and approves it or reject it. A corresponding message is sent to the supplier regarding the approval or rejection of his catalogue. Andriana Prentza et al. 281

8 ecop tool Catalogue creation DYPE procurement system Call for tender creation 1)Catalogue template creation 2)Validation Components 3) Transformation components 4)Call for tender publication Tender files download Hospital Procurement Offices Economic Operator Web services communication Offline (paper) Offer submission National Gateway 1) )Document exchange Call for tender committee Figure 2: Production Pilot Pre award procedure 3 SECTORAL HEALTHCARE REQUIREMENTS AND SPECIFICATIONS In the healthcare sector the need for standardized catalogue content is more critical than in other sectors involved in public procurement. Besides the common templates and profiles already specified in PEPPOL, the need arises for further harmonization and validation of ecatalogues according to sectoral requirements. It would be beneficial for the next round of piloting if healthcare-specific requirements were taken into account to produce a PEPPOL specification for healthcare ecatalogues. In short, this would require the undertaking of alignment and design activities regarding the further refining of current, sector-neutral format and processes. 3.1 PEPPOL ecatalogue format alignment for healthcare The issue of ecatalogue alignment rises in the Healthcare sector. There is a need for common and unified catalogues among contracting authorities, and in Greece this has taken the form of an approved registry of products that are accepted in public call for tender. It should be investigated what is the situation in other countries and what moves are being taken in this direction. Additionally, there is a need for specific classification systems or nomenclatures for the health sector, notably GMDN, since the common classification systems that are used in other sectors are not enough to classify medical products and devices. Taking into consideration the envisaged adoption of PEPPOL standards in Greece, the list of catalogue standards will be the following Andriana Prentza et al. 282

9 Legacy Ministry of Development codification CPV GMDN PEPPOL eclass (hierarchical category level classification system) Given the fact that some of the above mentioned standards are nomenclatures and other classification systems there is considerable inherent complexity in the task of alignment. PEPPOL can specify further elaboration of document formats and schemas, where and if relevant and applicable, in order to enable the transformation and validation of ecatalogues according to healthcare-specific classifications such as GMDN, while still maintaining compliance with the CEN BII standardization approach. 3.2 PEPPOL ecatalogue process alignment in healthcare In Greece EKEVYL has implemented and currently maintains the "Registry of Medical Devices", with the aim of recording and classification of medical devices available, or potentially available, in the Greek market. The Registry of Medical Devices is using the GMDN classification for product codification. Currently the registry includes 397 economic Operators, manufactures and products classified with GMDN codes. All economic Operators that are interested in participating in a public tender for medical devices in Greece, should be registered and certified in EKEVYL s Registry of Medical Devices. There are standard procedures for any economic Operator interested in registering his products in EKEVYL s registry including submission of proof documents for the products, in order to be certified by EKEVYL. GMDN is used as the classification system for the European initiative named EUDAMED. Eudamed is currently being used by a number of Member States on a voluntary basis and will be obligatory as from May EUDAMED is a European databank for medical devices that aims to strengthen market surveillance and transparency in the field of medical devices, by providing Member State competent authorities with fast access to information on manufacturers and authorized representatives, on devices and certificates and on vigilance and clinical investigation data, as well as to contribute to a uniform application of the Directives, in particular in relation to registration requirements. Eudamed contains data on: registration of manufacturers, authorized representatives and devices, data relating to certificates issued, modified, supplemented, suspended, withdrawn or refused, data obtained in accordance with the vigilance procedure and data on clinical investigations. An important tool for Eudamed is the Global Medical Device Nomenclature (GMDN). The development of GMDN started with a mandate to CEN for the development of a structure for a medical device nomenclature. The result, the European standard EN ISO "Nomenclature - specification for a nomenclature system for medical devices for the purpose of regulatory data exchange", was further developed into a CEN technical report. Maintenance of this work was taken over by the GMDN Maintenance Agency which developed the Nomenclature (referred to as GMDN) into what it is today, a comprehensive, regularly updated web-based nomenclature accessible to manufacturers against license fees. GMDN presents the best practice for Eudamed purposes, even though, for the time being, data entry is also possible without providing a GMDN code. In process terms, a healthcare-oriented PEPPOL ecatalogue specification would at least include an additional step to validate the catalogue according to healthcare specific classifications such as GMDN. Andriana Prentza et al. 283

10 Thereafter, each national implementation can follow local practice, with sectoral validation happening at the palce and by the stakeholder most appropriate for the local conditions, legislation, and business practices. In Greece, this would be done by EKEVYL. 4 CONCLUSIONS AND FUTURE WORK During the last years, ICT systems have become pervasive in business and most business processes are ICT supported in some way. Despite progress however there are still challenges for standardised electronic data transmission. The lack of a standard definition of ecatalogues across all EU countries is one of the existing or potential hurdles that all enterprises - and especially SMEs - face when trying to carry out cross-border public e-procurement transactions. Pre-award procedures in healthcare are still not fully automated due to the fact that the widespread use of electronic Catalogues in public procurement is not favoured by the current practices of the Contracting Authorities where they use their own formats requesting from suppliers to adapt the content of their electronic Catalogues. We expect that the pilot implementation in the 4th Regional Health Authority of Macedonia-Thrace (DYPE) will pave the way for standardised pre-award ecatalogue in healthcare. Acknowledgements This work is partially supported by the European Commission and specifically by the Information and Communication Technologies Policy Support Programme (ICT-PSP) of the Competitiveness and Innovation Framework Programme (CIP) under the PEPPOL project ( Pan European Public Procurement OnLine, Large Scale Pilot on eprocurement, contract number , Any opinions, results, conclusions, and recommendations expressed in this material are those of the authors and do not necessarily reflect the views of PEPPOL or the European Commission. References [1] The European e-business Report 2008: The impact of ICT and e-business on firms, sectors and the economy. 6th Synthesis Report of the Sectoral e-business Watch, 19 th March 2011 [2] Synthesis Report 2009/10: "ICT and e-business for an Innovative and Sustainable Economy, 19 th March 2011 [3] PEPPOL Technical Annex, 2009, PEPPOL Project, Contract number [4] PEPPOL Deliverable D3.1: Functional, Technical, Legal and Organisational Specifications for the development of building blocks software enabling cross-border use of ecatalogues. [5] PEPPOL Deliverable D3.2: Specification of architecture and components enabling cross-border ecatalogues [6] CEN/ISSS WS/BII, INFORMATIVE REPORT, ecatalogue and Classification, 19 th March 2011 [7] Organisational Pre-Conditions for e-procurement in Governments: the Italian Experience in the Public Health Care Sector, Francesco Bof and Pietro Previtali, Electronic Journal of e- Government Volume 5 Issue (1-10). [8] Electronic procurement in healthcare: International state of the art and the Greek efforts, Alexander Berler, Yannis Apostolakis, Health Review, volume 21, issue 127, pp 9-14, 2010 (in Greek) [9] Optimal Public Procurement Services In The Healthcare Marketplace OPUS tabaseid=9cd97ac2e51045e39c2ad6b86dce1ac2 [10] E-Procurement Optimised System For The Healthcare Marketplace E-POS [11] PEPPOL Deliverable D3.3: Software building blocks enabling cross-border ecatalogues Andriana Prentza et al. 284