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$35M 'squandered'? Orion Health calls on Auditor-General to review COVID-19 system procurement

$35M 'squandered'? Orion Health calls on Auditor-General to review COVID-19 system procurement

Ministry of Health says a proper tender was undertaken and the new system has greater functionality.

Ian McCrae (Orion Health)

Ian McCrae (Orion Health)

Credit: Supplied

Orion Health CEO and founder Ian McCrae is calling for a full audit review of the Ministry of Health’s procurement of a $38 million national immunisation service platform.

McCrae said he believed the reported $38 million cost of the new immunisation system was a "scandalous" amount.

"I strongly believe that COVID-19 was simply used to circumvent proper procurement and this has cost New Zealand hugely," McCrae said in a letter to the Auditor-General and the Ombudsman released today.

"At Orion Health, we saw first-hand that the Ministry of Health ignored their procurement processes and used false information in their business case to substantiate their rationale for flouting procurement processes."

According to one media report, the new system leverages the National Screening Solution (NSS) platform, built on Salesforce and other technologies.

McCrae said Orion Health and other local vendors believed they could have delivered the project faster and at a fraction of the price had they been included in the procurement process.

Other international vendors would probably have submitted proposals as well.

Orion Health, he said, would have proposed a simple schedule upgrade costing less than $50,000 to the existing National Immunisation Register, which has been in place for 20 years and was supplied by Orion. 

This would have been fully operational within weeks, McCrae said, and delivering more functionality than the current $38 million project.

"Additionally, we could have cheaply rolled out a number of enhancements and improvements that we have been proposing for several years to the National Immunisation Register system."

Shayne Hunter, deputy director-general of data and digital at the Ministry of Health said he had not heard from the Office of the Auditor General and was not in a position to comment on the specific points raised until more was known.

However, he said, the ministry was confident it followed appropriate procurement processes and principles, reflecting the situation being faced and the need to act promptly.

"The Ministry formally procured a platform in 2018 through a proper RFP to support bowel screening and other population health services," Hunter said.

"In response to COVID-19, we have leveraged this platform repeatedly throughout the past year (along with other technology platforms and components) to support contact tracing, management of the border, COVID-19 testing and reporting."

Hunter said the ministry had always intended to replace the existing national immunisation register.

"When we faced the possibility that COVID-19 vaccines may be arriving in New Zealand considerably earlier than expected, we were able to leverage the population health platform to stand up a new COVID-19 immunisation register by December 2020," Hunter said.

"This work was successfully completed in under a month and the system was live for the beginning of January 2021.

"The system is being successfully used to support the vaccine rollout across New Zealand, and has been well-received by clinicians."

He said the system itself is significantly more complex and has greater functionality than the old national immunisation register, which was a register rather than a service that supports a full range of inventory, distribution, adverse reactions, and workforce.

The system was currently being developed to accept online vaccination booking applications, for instance.

"All of the development work on the platform has taken place with local New Zealand-based suppliers, as well as ministry staff," Hunter said.

Fifteen suppliers had been involved. 

"There are significant benefits from having vaccinations sitting as part of a wider ecosystem of pandemic and disease responses, and we are building a national asset that can live beyond the COVID-19 response."

McCrae also denied Orion Health had told the ministry it would cease supporting the existing immunisation register platform in beyond 31 March, 2022.

A Ministry of Health official had asked Orion Health to confirm that the National Immunisation Register was being grandfathered and Orion had "unequivocally stated was not true" and queried where the information had come from, he said.

McCrae said his request for a full audit review was about the principal of the situation, not a concern that Orion Health was missing out.

Orion Health would have liked to provide the solution, not for the likely $1 million to $2 million of revenue, but to do something good for New Zealand health, he said.

"Simply put, by not following any process the Ministry of Health has squandered $30 million to $35 million, which is appalling," McCrae said.

Hunter itemised some of the projects delivered in the past year:

They included the National Contact Tracing System, NZ COVID Tracer app, a border workforce testing register, the Āwhina app for health care workers, a border management system for managed isolation and quarantine facilities that was integrated with airlines, apatient management system for managed isolation and quarantine facilities, the COVID-19 Immunisation Register and a streamlined data and analytics pipeline to provide COVID-19 information and insights for testing, case management, contact tracing and vaccinations.


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