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TON TARRANT: The long-awaited market inquiry into the private healthcare sector is under way. Preparatory work has been done and today saw the announcement of the administrative guidelines, the administrative timetable and statement of issues for the inquiry. The inquiry panel will be chaired by former chief justice Sandile Ngcobo. Of course, a number of JSE-listed companies will be part of the inquiry. I think of companies like Discovery Health, Metropolitan, part of MMI, of course the big hospital groups Mediclinic, Netcare, Life Healthcare – those are just some of the obvious ones. Earlier today I spoke with Tamara Paremoer, director for the market inquiry into the sector at the Competition Commission, and asked her how the inquiry would differ from a typical Competition Commission investigation. TAMARA PARAMOER: The market inquiry differs in respect that it’s a general investigation into the state of competition in the market. So it’s not as we would do in a typical investigation, investigate particular …practices… and firms. [Audio quality problematic.] In fact, what we are doing is evaluating the market broadly in an inquisitorial manner and trying to understand whether … that market prevents or distorts or restricts competition. HILTON TARRANT: Now there’s been some debate around the spirit of the inquiry and the sentiments surrounding it. Is there any indication of what will be looked at and perhaps what won’t be looked at in the inquiry? TAMARA PARAMOER: We know that there is particular interest from stakeholders about the extent to which we look at particular features of the pharmaceutical and medical devices, and also other consumables markets. But those will be evaluated to a limited extent. Essentially what we are looking at here is the extent to which those particular areas impact costs or drive costs in the private healthcare sector more broadly. In terms of the rest of the market … looking at cost inflation, but we are also looking at other features that may impact efficiency of operation, such as for example regulation, the market structure and whether any of this … substantial market power and what that means for bargaining power between the different parts of the healthcare sector. HILTON TARRANT: Companies in the healthcare sector – will they be required to make submissions? TAMARA PARAMOER: Yes, they will be. And the way that they manage that is the Commission will send out information requests to particular participants in the sector where we have specific questions. We will also open the inquiry for submissions in general. Yet we may ask specific questions of key firms. But we will also allow them to provide any information that they think is relevant. Of course the Commission and the inquiry don’t have the capacity to also summons information, but we have emphasised that we are conducting this inquiry on the principles of fairness, transparency and openness, and we hope that the private sector will also participate and cooperate with us in a spirit of openness as well. HILTON TARRANT: Would they be able to submit information confidentially? TAMARA PARAMOER: Yes. The prescripts of the Act apply. So firms can send confidentiality…of a commercial confidentiality of information, but we have also asked firms to be quite clear about the particular information that is confidential and to provide reasons for claiming confidentiality of information. You’d probably be able to appreciate that an inquiry such as this really relies on the openness of the process and the extent to which people give access to the information. And so of course we will respect confidentiality claims, but we are also urging firms to just think carefully about the extent to which they claim confidentiality as justified on the grounds set out in the Act. HILTON TARRANT: Speaking of process, the timeline announced today – take us through when the Commission would hope to have completed this inquiry, and some of the deadlines leading up to that. TAMARA PARAMOER: … November 2015, and in the next few months what we will be doing is just ironing out the procedural matters. So we will be developing administrative guidelines and what we call a statement of issues, which really just sets out the areas that will be probed. And those will be released for public comments at the end of May. We will then allow stakeholders a month, so the month of June, to submit their comments on the guidelines and the procedures that will follow, as well as whether they think the issues that we’ve identified cover everything that they should. And then we’ll incorporate or review those comments during July and the investigative work starts on August 1. So that’s when we will start issuing information requests and receiving information from the public. I think the other key date that people are interested in is the public hearings. Those will happen next year,… over March and April 2015. And the … of the hearing in Pretoria that we are evaluating – whether or not there is a need to move the hearings around the country. This article first appeared on MoneyWeb: http://bit.ly/1m9oMKT
