Tech suppliers clamber for Medicare payments deal

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Tech suppliers clamber for Medicare payments deal

But way forward unclear.

The Department of Health is confident it can find suppliers to replace its Medicare payments processing system before 2019.

But the agency has been told by industry that it should proceed with a "modular, flexible and staged" approach for the complex build of the new platform.

The proposed platform will replace 200 separate applications and 90 different databases that currently deliver 600 million payments worth $50 billion every year for Medicare, the pharmaceutical benefits scheme, veterans and aged care recipients.

The agency asked suppliers earlier this year to pitch off-the-shelf IT solutions that could replace the ageing system, as part of a two-stage procurement process.

The overhaul has since received $67.3 million in this year’s federal budget.

Through the RFI process, the agency received significant interest in the project from systems integrators, enterprise software suppliers, and niche application providers from both the health and fintech sectors.

This has given it confidence that the right technologies can be sourced, it said. Those technologies may include off-the-shelf and as-a-service products for multiple capabilities.

The majority of submissions by industry recommended a modular architecture to allow the agency to draw from a range of different suppliers for delivery.

A modular platform would connect its components using open standards, APIs and other interoperability patterns.

However, this would necessitate strong governance around managing a multi-vendor environment, potential suppliers said.

Submissions also suggested approaching the build incrementally, and ensuring that the end result can support the swap-out of technologies over time.

"The market identified that a two-speed delivery approach would enable earlier benefits and incremental progress on the government’s operation of the platform," Health said.

It could also see the agency deliver the platform using "discrete work packages that are specified and procured in stages" – a similar approach to the Department of Human Services' welfare payment infrastructure transformation program.

The agency is planning to release a procurement plan later in the year to provide the "timelines for future approaches to market for service and components to support the long term solution".

Further engagement meetings with industry will be held in Canberra, Melbourne and Sydney next month to refine business and technical requirements.

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