Conducting Supplier Debriefings

The Broader Public Sector Procurement Directive entitles unsuccessful proponents participating in a procurement valued at $100,000 or more to a supplier debriefing. A debriefing is an opportunity for a proponent to:

  • discuss with the purchaser the strengths and weaknesses of the proponent’s submission in relation to the evaluation criteria of the procurement;
  • ask questions related to the procurement process; and
  • provide feedback on how the procurement process and the purchaser’s practices could be changed or improved.

A purchaser must include in the documents that initiate a procurement details about supplier debriefings, including the process by which a proponent can request a debriefing. A purchaser must provide proponents with at least 60 days following contract award notification to request a debriefing.

A debriefing should be a process that allows both the purchaser and a proponent to gain valuable input from the other. However, if not conducted properly, a debriefing could lead to additional questions or process-related challenges from a proponent, which would likely mean greater costs being incurred by the purchaser for staff time and legal fees.

To ensure that your organization carries out debriefings efficiently, effectively, and in keeping with applicable regulatory and contractual obligations, your debriefing processes should be formalized to ensure consistency and your staff should be educated on restrictions imposed by applicable procurement requirements and contractual obligations.

DDO is experienced in helping our clients to:

  • establish straight-forward and effective processes for addressing debriefing requests;
  • ensure that their staff are up-to-date on current legislative and regulatory requirements related to debriefings;
  • create an agenda for debriefings that will allow for consistency across debriefings and contribute to the (a) equitable treatment of proponents and (b) transparency of the process;
  • formalize document management and record-keeping procedures for debriefings;
  • train procurement staff on leading a debriefing and on identifying questions that are out of scope of a debriefing; and
  • educate staff on the confidentiality obligations that a purchaser owes to the proponents in a procurement process.

If you are interested in DDO providing your organization with advice on debriefings, or if you have any specific questions related to debriefings, please do not hesitate to reach out to me: mgleeson@ddohealthlaw.com

Educating Your Procurement Team

“An ounce of prevention is worth a pound of cure.”

One good way to help your organization avoid claims related to a procurement process is to provide some simple training to your staff members who will be participating in the procurement process. In many cases your internal evaluation team will include individuals for whom procurement is not an everyday part of their jobs. These staff members will likely be unaware of the basic principles, rules, and processes with which your organization must carry out its procurement activities.

DDO believes that there is significant value in educating your internal procurement team on such things as:

  • conflicts of interest;
  • treatment of incumbent vendors;
  • the dangers of politicizing procurement decisions;
  • confidentiality;
  • communication with proponents during the procurement process;
  • process transparency; and
  • equal treatment of vendors.

If your staff are unfamiliar with the above-listed ideas, which are essential for a properly run procurement process, a staff member could unwittingly put your organization in breach of applicable procurement rules. Such a breach could force you to re-do the relevant procurement process and put your organization at risk of a legal claim brought by an unhappy proponent.

DDO can help you to create simple and efficient tools to ensure that your procurement team has knowledge of (or, as applicable, are simply reminded of) essential procurement rules prior to their participation in a procurement process.

Contact me: mgleeson@ddohealthlaw.com

 

Beware the Scope of the CFTA

If your organization is a broader public sector organization that is subject to the procurement requirements of the Broader Public Sector Procurement Directive (the “Procurement Directive”) and the (still relatively new) Canadian Free Trade Agreement (“CFTA”), then please take note that the CFTA applies to certain procurements that the Procurement Directive does not.

The Procurement Directive requires organizations to maximize the value that they receive from “public funds”. In the Broader Public Sector Accountability Act, which is the Ontario legislation under which the Procurement Directive came into force, the term “public funds” is defined, subject to certain exclusions, as follows:

“public money of the province of Ontario that is provided by the Government of Ontario or an agency of the Government of Ontario, directly to any authority, board, commission, committee, corporation, council, foundation or organization through a grant or transfer payment or other funding arrangement, and, in the case of a school board, includes money received by the school board from taxes levied under the Education Act for school purposes.”

Based on this definition, the source of funds used for procuring a good or service is relevant to whether the Procurement Directive would apply to the procurement of such good or service. For example, if a public hospital were to purchase goods using funds that were received through charitable donations or that were proceeds from revenue-generating aspects of its activities, that purchase would not be subject to the requirements of the Procurement Directive because it would not involve the expenditure of public funds.

The CFTA, which came into effect just over a year ago (July 1, 2017), does not include a similar reference to public funds and, therefore, is not limited in application only to procurements involving such funds.

The CFTA does include an exemption related to the source of funds for a procurement, but the exemption is far more limited than an exemption for all procurements using non-public funds. The relevant exemption states that the procurement chapter of the CFTA does not apply to “procurement of goods or services financed primarily from donations that require the procurement to be conducted in a manner inconsistent with this Chapter”. In other words, in order for a procurement carried out using donated funds to be exempt, the donated funds would have to have been received by the purchasing organization under a condition that specifically required that the funds be used in a manner that conflicts with the procurement requirements of the CFTA. In our experience, the attachment of such a condition to donated funds would be unusual.

How can we help you?

DDO encourages broader public sector organizations to review their procurement policies to ensure compliance with the requirements of the CFTA. The public funds issue described above is just one of several issues on which the CFTA differs from the Procurement Directive. If you would like help in ensuring that your procurement policies are up to date, please do not hesitate to contact me: mgleeson@ddohealthlaw.com

Health Sector Supply Chain Strategy – Expert Panel Report

In May of 2017, the Healthcare Sector Supply Chain Strategy Expert Panel (the “Panel“) released its report titled “Advancing Healthcare in Ontario: Optimizing the Healthcare Supply Chain – A New Model“. The Panel was established by the Government of Ontario in 2016 to review Ontario’s current healthcare procurement strategies and to recommend strategic changes.

The Panel envisions a new supply chain strategy being implemented in Ontario over a 3-year period and provides 12 recommendation for its creation and implementation. These are categorized using the five overarching themes below:

  1. Ontario should have an integrated healthcare supply chain.
  2. Buying decisions should be made with a focus on patients and clinical requirements.
  3. The new procurement strategy should enable value-based procurement and innovation.
  4. The strategy should include means of monitoring and improving on performance, value, quality and safety.
  5. How to transition to the new supply chain strategy.

We list below the recommendations that the Panel made to further these 5 overarching themes.

Moving to an Integrated Ontario Healthcare Supply Chain

  1. A Single Integrated Structure: Organization Consolidation. The Panel recommends that Ontario create a single consolidated organization (“ServiceCo“) to manage Ontario’s healthcare supply chain. The Panel believes that “one crown agency or not-for-profit model is best positioned to deliver the opportunities outlined in this report”. The Panel envisions the assets of Ontario’s existing healthcare shared services organizations (“SSOs“) could be leveraged to support ServiceCo. The Panel imagines that the existing SSOs could be integrated, or their assets used, to create ServiceCo.
  2. ServiceCo’s Mandate, Scope & Scale. The Panel recommends that ServiceCo take responsibility for essentially all steps in the supply chain process for all non-payroll categories of healthcare spending.
  3. Toward Fuller Healthcare Participation. The Panel recommends that the following healthcare providers be mandated to participate in ServiceCo: (i) publicly-funded hospitals; (ii) LHINs and the home and community care services they manage; and (iii) LHIN-funded community agencies. The Panel also recommends that other healthcare partners be encouraged to seek the services of ServiceCo (such as non-profit and for-profit long-term care homes and Crown agencies.
  4. A Robust Financial and Business Model. The Panel recommends that ServiceCo’s revenues should  come from, amongst other sources, a mix of (i) the existing in-house budget of participating healthcare providers; (ii) the budgets of existing SSOs; and (iii) fees that will be established based on the total operating budgets of the publicly funded healthcare organizations to whom ServiceCo provides services.

Encouraging Patient and Clinical Focused Buying Decisions

  1. Strengthening Clinical Engagement. The Panel recommends that clinical and medical expert “advisory panels” be established to provide advice and recommendations to ServiceCo with respect to procurement approaches and evaluations so that consideration of innovative technologies, clinical approaches and patient outcomes become a more significant consideration in procurement processes.

Taking a New Approach to Procurement

  1. Building Capacity to Undertake Value-Based Procurement. The Panel has recommended that “value-based procurement” be a central principle for ServiceCo. The Panel believes a focus on value-based procurement will allow ServiceCo to carry on supply chain activities in a manner that will improve patient outcomes across the full continuum of care.
  2. Procuring Innovative Products and Solutions. The Panel believes that continuous innovation is critical for the improvement of Ontario’s healthcare system. Based on this belief, the Panel recommends that ServiceCo be provided with the expertise, infrastructure, and market relationships to identify and procure “new products and solutions rapidly and proactively”.
  3. Addressing the Regulatory Environment. To facilitate value-based procurement and the continuous implementation of innovative technologies, the Panel recommends that Ontario’s current procurement policy framework – including the Broader Public Sector Procurement Directive – be reviewed and updated as necessary. The Panel proposed that clear and consistent instructions on the application of the Directive could help avoid the “overly cautious behaviour” that was consistently reported to the Panel during its review of Ontario’s current supply chain model.

Performance, Value, Quality & Improved Safety

  1. Data Integration and Analysis, Performance, and Reporting Framework. The Panel recommends the development of a robust data collection and analysis capability for ServiceCo. It is hoped that such data collection and analyses will create business intelligence that would allow for accurate evaluation of key performance metrics and the development of value-based procurement.
  2. Mechanisms for Feedback, Engagement, and Inclusion. The Panel recommends the creation of feedback mechanisms for healthcare providers, patients, and vendors to provide feedback on the performance of ServiceCo, as well as the products, services and solutions that it procures.
  3. A Framework for Full Product Traceability. To improve both patient safety and business analytics, the Panel recommends that ServiceCo adopt a bar-coding standard that can provide full traceability of products to patients.

Moving Forward

  1. Transition to a New Model. The Panel recommends the appointment of a Transition Board with a mandate not to exceed 12 months. The Transition Board will, among other things, be asked to: establish ServiceCo; transition assets to ServiceCo; and develop a strategic business plan for ServiceCo. The Panel recommends that the assets and services of existing SSOs be managed by the Transition Board during the term of its mandate.

The Ministry of Health and Long-Term Care has stated on its website that:

Over the coming months, the government will review the panel’s recommendations, and engage section partners in a dialogue that considers building and modernizing our supply chain model in healthcare, leveraging the investments and advances already made.

Our Take on the Report

We work on a daily basis with many of the healthcare procurement SSOs across the Province. They have revolutionized procurement in Ontario healthcare, introducing rigour, specialization, and expertise to a back-office activity that was often poorly performed by hospitals less than a decade ago.

Yes, the pendulum has been swinging back and forth over the last decade. From sloppy and decentralized practices, the Supply Chain Guidelines and the replacement BPS Procurement Directive introduced rules – and rigidity – to the procurement process. Now that we have lived with the BPS Directive for several years, SSOs and hospitals are becoming more comfortable with the rules and are innovating to work within them.

There can always be more improvements in healthcare procurement. But the changes should be made in a way that hospitals can buy into and own the changes – and the resulting ServiceCo. SSOs are now governed by the hospitals that use their services. Stepping away from hands-on governance will be a challenge for hospitals. Any governance changes should be gradual, so that hospitals can build trust in ServiceCo, its board and its leaders.

We anticipate that change will come, but slower (and steadier) than the Panel recommends.

Charities and Political Activities

As we are in the midst of a federal election campaign in Canada, this is a good time for registered charities to review Canada Revenue Agency’s rules related to charities and political activities. The following link will connect you to a Canada Revenue Agency website that contains some useful tools and reminders to ensure your organization remains compliant with Canada Revenue Agency rules and regulations related to political activities: http://www.cra-arc.gc.ca/chrts-gvng/chrts/cmmnctn/pltcl-ctvts/menu-eng.html.
If you only do one thing this election campaign, remind your directors, officers, employees and other representatives that charities are prohibited from devoting any of their resources to partisan political activities. Canada Revenue Agency defines a “partisan political activity” as an activity “that involves direct or indirect support of, or opposition to, any political party at any time, whether during an election period or not, or a candidate for public office”. If an individual that represents a charitable organization would like to be involved in any partisan political activities they should (i) do so in their personal capacity and not in their capacity as a representative of the charity, and (ii) not use any resources of the charity in carrying out such political activities.

Recommendations from the QCIPA Review Committee

In 2014 the Ministry of Health and Long-term Care called for the formation of a committee to look at current practices in the interpretation and implementation of the Quality of Care Information Protection Act and to make recommendations for improvement. The resulting QCIPA Review Committee, which submitted its report to the Ministry in December 2014, issued 12 recommendations. These recommendations include among other things propositions related to: (i) changes in the legislation; (ii) an increased emphasis on patient involvement in investigations; and (iii) mechanisms to better utilize the lessons learned through investigations. Michael Gleeson was recently interviewed on the topic. See:

http://www.advocatedaily.com/recommendations-for-qcipa-a-good-step-forward.html

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