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Sector inquiry into Health Services

Sector inquiry into Health Services

The Hellenic Competition Commission (“HCC”), taking into account the rearrangements taking place in the private health services sector in the last five years as well as the restructuring of the regulatory framework for the provision of related insurance services, has initiated by decision of 5.7.2021 a sector inquiry into the provision of private health services and related insurance services, exercising the respective powers conferred on it pursuant to Article 40 of Law 3959/2011.

The right to health protection is provided for and protected by the Greek Constitution as one of the fundamental human rights as it relates to human existence itself.

In Greece, although the National Health System offers universal health coverage, a particularly significant share of private expenditure in the provision of health services, 90% of which, according to the inquiries carried out in the specific sector, seems to come directly from individuals with only 10% being covered by private insurance companies.

The functioning of the market for the provision of private health services is inextricably linked to the market for health insurance services, due to the uncertainty that exists regarding both the need to use the relevant services and the results of their use.

In this context, the organisation and operation of the adjacent and interdependent markets for the provision of health services and health insurance services focuses on the different ways in which health service providers and insurance providers interact. The key variables of the mechanism of these markets include quality and prices of the services provided, the range of the network, the insurance premiums and the range of insurance coverage. Competition in the wider industry can be horizontal between health service providers and between health insurance providers but also vertical in terms of bargaining power between insurance providers and health service providers.

At each level, not only the above-mentioned variables but also the dynamic growth of the health and insurance services sector, such as the unclear separation between private and public services, should be taken into account, as well as the impact of medical and insurance data management by their respective providers, especially in the case of partial or total vertical integration of the existing health and insurance service providers.

Competition issues to be considered are identified, in principle, in the competitive process between health service providers in terms of quality and prices of the services provided. In particular, in the context of the sector inquiry, the new structure and specificities of the market should be reflected as it tends to take shape following the acquisitions that take place in the wider health and insurance sector, by the vertical integration of companies but also by exploring any structural links between competitors as well as capturing any partial vertical integration relationships, in order to better understand market operation and the concentration observed in certain geographic markets (e.g. Attica). It should then be assessed whether there has been a strengthening of specific players in the market or to what extent the concentration of the industry produces a symmetry of market shares, thus facilitating coordinated or non-coordinated effects resulting from the market structure. Other issues to be explored are the possible strong bargaining power of specific market players and / or the possibility of tacit coordination of health service providers in markets that determine the quality of health services (infrastructure, technologies, pharmaceuticals and healthcare material, etc.). The above assessment should also take into account the extent to which access to patient and / or physician databases can actually and / or potentially affect the above relationships and practices.

Other potential issues to be considered include competition between insurance coverage providers for the health services network provided, prices in relation to the quality offered in the insurance packages available but mainly the bargaining power between the insurance providers and the health service providers with regard to prices and customer attraction through other parameters such as quality, variety, network range, etc. In particular, the relationships shaped within an ecosystem defined by a two-sided platform the role of which is assumed by the insurance company to connect health service providers with policyholders should be explored.

Other, competition issues to be explored are the barriers to entry in the health and insurance service market, which may affect innovation and market growth, as well as regulatory issues in both the health service market and the insurance service market. A more targeted analysis is also needed to further understand how public institutions and organisations, whether acting as health service providers or health insurance providers, affect market balance and private conduct.

Some new practices that have emerged in the industry and will be explored in the context of the sector inquiry include the role of data in the growth of the personalized medicine industry and the changes in the value chain for private health services and how they affect the related sector of private health insurance also due to the possibility provided by the collection of Big Data.

In the wider health care value chain, different providers hold different types of data.

  • (Patient) Clinical data are usually kept by physicians and clinical trial data are held by pharmaceutical companies. 
  • Internet companies, such as search engines, online platforms, or specific digital health service providers, may keep data on patients' health, behavior, fears, and conduct (lifestyle data).
  • Medical device companies, especially in the context of the development of (electronic) e-health applications (e.g. portable smart sensors and microscopic devices outside or inside the human body) collect the necessary medical information and exchange healthcare data by contributing to e-health solutions.
  • Public health authorities, insurance companies and specific health data companies keep data on the cost and consumption of medicines or healthcare.

Developments in diagnosis and the ability to exchange real-time information between different monitoring devices (e.g. sensors integrated in mobile phones and monitoring devices) have drastically changed the ability to diagnose, evaluate and respond in a timely manner. Machine learning algorithms can review the latest health data available, including genomic sequences, clinical patient records, and diagnostic test results to make forecasts and recommendations. Artificial Intelligence (AI) is further used to turn an amount of data into potentially valuable information of interest to patients, hospitals, insurers and other health service providers. Digital health solutions, such as screening and testing services available in applications or even artificial physicians, will be instantly accessible through mobile devices. Enhancing competition and the ability of start-ups in medical technology services to enter these markets contributes to innovation and quality health services.

In light of the foregoing considerations, the sector inquiry will also consider:

  • the structure and governance of the health services value chain, in particular taking into account the importance of data,
  • the business strategies and business models, but also the potential competitors that can be active in this sector, especially due to the growth of MedTech and InsurTech services and ecosystems,
  • how existing regulatory rules may affect competition in these new ecosystems. 

  

In the context of Phase A’ of the sector inquiry, we announce the launch of a public consultation and kindly invite all interested parties to express their views and comment on the competitive conditions in the broader sector. The stakeholders concerned may contribute to the public consultation by participating in the relevant teleconference that will be held by the HCC in September 2021, and/or by submitting their views in writing, in the form of a memo. 

It is noted that the above shall be without prejudice to the possibility of the HCC to further specify and / or limit the subject matter of the inquiry, depending on the progressive occurrence of the inquiry findings.

Sector inquiry into Health Services

 

 

 

Latest Updates

  • 12 July 2021 - Announcement of the launch of a public consultation: publication of an invitation to any interested party to submit written observations and comments, as well as to express interest in participating in a teleconference with officials of the Hellenic Competition Commission, read the relevant Press Release here
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Questions & Answers

- General Questions: Scope and Aims of the Sector Inquiry

Τhe Greek National Health System offers universal health coverage, based on taxation as well as on contributory social security but, in addition, it involves a particularly significant share of private expenditure. In our country, 90% of private health expenditures come directly from service "users" (citizens), and only 10% is covered by private insurance companies in contrast to all other European countries. 

  • Private health service providers are distinguished in clinics as Secondary Healthcare providers and in private diagnostic centers and polyclinics as well as Healthcare providers. Private clinics, as well as public hospitals, are divided into General (pathology and general surgery departments), Mixed (nursing departments and more than one pathology and general surgery departments) and Specialised clinics (healthcare departments specialised in one specific area of medicine).
  • According to the annual Health Survey on health units carried out by the Hellenic Statistical Authority (ELSTAT), the number of therapy institutions, private clinics and public hospitals in Greece in 2019 amounted to 269 units, decreasing by 3.9% in the last four years. Based on their legal status, the highest percentage (52.4%) of hospitals in 2019 were private. In 2019, 63.2% of hospitals were General, 32.0% Specialised, in various areas of medicine and 4.8% Mixed.
  • In recent years, there have been rearrangements in the sector of private health services, contributing to the concentration of the industry. With regard to the market for private Secondary Healthcare services, it seems that the five (5) largest groups hold about 46% (CR5 = 46%) of the total market while the market concentration in private Primary Healthcare services, namely the diagnostic centers, is such that the three (3) largest groups hold about 37% (CR3 = 37%) of the total market.
  • Regarding the private insurance sector, it is observed that in Greece the penetration of the population in it compared to the rest of Europe is limited as Greeks still have a limited insurance awareness. Specifically, insurance premiums are estimated to represent a 2.0% of GDP in Greece (2019) while respectively in the EU-28 they constitute a 7.45% (2018).
  • Only a small number of large companies with strong bargaining power and significant market share operate in the industry while the rest of the companies are small to medium-sized but numerous, competing for a smaller market share. In total, the number of companies operating in the Greek market amounted to 53 in 2018, compared to 86 in 2006 out of which 22 were active in life insurance and health insurance services. According to the Bank of Greece, in 2020 only a total of 33 companies were operating in the specific market. In the provision of health insurance services, it is estimated that the three (3) largest companies hold about 50% (CR3 = 50%) of this market. Significant concentrations have taken place in this sector as well and this trend is likely to continue.
  • It is noted that health insurance premiums have increased significantly in the last four years. In 2019, it is estimated that health insurance premiums amounted to € 254.3m, increased by 9.1% as compared to 2018.

In the interconnected subsectors of health services and related private insurance services, a network of relationships is developed within an ecosystem with special characteristics that needs an in-depth analysis. In principle, the competitive relationships that are shaped in the value chain of the industry are the following:

  1. horizontal competition between health service providers in respect of quality and price of the services provided as well as attracting physicians of different specialties,
  2. horizontal competition between providers of insurance coverage in respect of network range, insurance premiums and insurance packages,
  3. vertical competition (bargaining power) between insurance providers and health service providers in respect of healthcare pricing,
  4. competition between market players in respect of access to medical and client data which can make a significant contribution as a competitor foreclosure tool and / or as a tool for concluding exclusive contracts and / or tying or bundling if the data holder uses its power gained from the holding of this data to transfer its power to another market and enforce the use of its services. The use of databases can also function as a tool for direct consumer abuse, through practical personalised supply prices / discriminatory pricing.

The prospect of launching this sector inquiry was already explored since 2020 and the sector was prioritised by Decision of the HCC’s Plenary. However, due to the particular circumstances that came up during the pandemic, especially in the wider health sector, its launching has been pushed back. The initiation of the sector inquiry coincides with the following facts:

  • significant rearrangements in the sector of health and insurance services due to strategic cooperations - acquisitions to enhance the economic efficiency of undertakings but also to meet strategic goals,
  • conditions conducive to an increase in the demand for private health insurance to cover the deficiencies in public funds,
  • technological development combined with digital evolution of health services,
  • development and management of large databases (BigData) of service providers and customers which contribute positively to science but involve risks for the evolution of the competitive conditions in the sectors concerned.

In this context, the Hellenic Competition Commission is taking the initiative to launch a sector inquiry into the sector of private health and insurance services, using the relevant capacity provided by law, to determine whether and to what extent competition in the digital environment works effectively and to identify any practices that are able to harm consumer welfare and hinder innovation and competitiveness in Greece in the broader sector.

In the context of the sector inquiry into private health and insurance services, the HCC will focus on issues such as: 

  • definition and mapping of the relevant markets,
  • assessment of any power in the individual markets as well as the definition of the ecosystem shaped by the interdependence, structural relations and shareholding relations between market players,
  • identification of the parameters that form the competitive framework at horizontal and vertical level,
  • assessment of the bargaining power created throughout the value chain in the provision and financing of health services,
  • the regulatory and supervisory framework on these markets, with an emphasis on any licensing requirements, any ambiguities or gaps in this framework and any impact on new entrants or on the expansion of existing market participants,
  • the collection, management and utilisation of medical and other data and the bargaining power they give to their holder, possible market failures,
  • any use of data access mechanisms in a way that could lead to competitor foreclosure practices,
  • assessment of the relevance of competition law instruments to address identified issues compared to sector-specific legislation.

- PHASE A’: Public Consultation

You can assist the HCC’s work from the earliest stages of the sector inquiry into the sector for the Provision of Private Health Services and related Insurance Services. We kindly invite you to contribute to the public consultation by participating in the relevant teleconference that will be held by the HCC in October 2021 and/or by submitting your views and comments, in the form of written submissions, toThis email address is being protected from spambots. You need JavaScript enabled to view it..

  • Participation in the teleconference organised by the HCC
    In October 2021, the HCC will organise a conference on Private Health and Insurance Services aimed to be the first forum with a view to hearing the positions of each stakeholder. Due to the unforeseen circumstances created by the pandemic of coronavirus (Covid-19), the relevant conference will most likely be held online, in the form of a teleconference. Please express your interest in participating in the teleconference by sending an email to This email address is being protected from spambots. You need JavaScript enabled to view it., by September 6, 2021. Please indicate in your message the name of the institution or company you are representing. The date of the conference or teleconference will be announced shortly. An invitation with details on the exact date and time of the teleconference, as well as on the way of communication, will be sent to the participants in due course.

  • Written submissions
    In addition to your participation in the HCC’s teleconference, you are invited to submit your comments and observations in the form of written submissions by Monday, September 27, 2021. The HCC will process the collected submissions and will publish an anonymous summary table of issues raised through the above website, also giving you the opportunity to express your views during the specially designed conference or teleconference.

If you wish your submission or any part of it to be treated as confidential, please make a relevant statement when submitting it.

Participation in the consultation is open to anyone who can provide useful information and comments on part or all of the issues that are the subject of this sector inquiry. We will greatly appreciate the participation of (amongst others):

  • Businesses active in all levels of private medical services (clinics, hospitals, diagnostic centers, etc.)
  • Businesses active in the provision of health insurance services
  • Medical unit supplier companies for data collection, processing and management
  • Associations / federations of various medical specialists 
  • Other associations and unions of suppliers, customers, employees
  • Academics and researchers

 

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Timeframe 

  • July 2021 - Formal launch of the sector inquiry into Private Health and Insurance Services
  • 26 October 2021 - First public consultation: publication of an invitation to any interested party to submit written observations and comments, as well as to express interest in participating in the teleconference with officials of the HCC
  • July 2022 - Publication of the Interim Report
  • September 2022 - Second public consultation
  • December 2022 - Publication of the Final Report
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