Healthcare deal could lead to higher costs for NHS

Deal to combine healthcare tech and data specialists could lead to lower quality and more expensive
software options for the NHS.

An initial investigation by the Competition and Markets Authority (CMA) has found UnitedHealth’s
£1.2bn deal to buy EMIS could reduce competition leading to worse outcomes for the NHS and
ultimately patients and UK taxpayers.

The NHS is increasingly seeking digital and data-driven solutions to help improve the delivery of
healthcare in the UK. EMIS is a large and established supplier of data management systems to the NHS.
This includes supplying the electronic patient record system used by the majority of NHS GPs in the UK.
Optum, part of the US healthcare giant UnitedHealth, currently supplies software used by GPs when
prescribing medicines, as well as data analytics and advisory services that the NHS uses to help improve
overall healthcare and health service provision (Population Health Management).

As part of its Phase 1 investigation the CMA looked into these services and how UnitedHealth’s purchase
of EMIS may impact competition to develop and supply digital and data analytics products to the NHS.

The investigation found competition could be substantially reduced specifically in the Population Health
Management and medicines optimisation software markets (which enable the safe and effective use of
medicines).

The CMA is concerned the deal could impact services provided by Optum’s competitors. Optum and its
competitors rely on digital connections to the data that EMIS holds, and integrations with EMIS’s
electronic patient record system. Optum could, if the merger went ahead as planned, choose to limit
these connections and the CMA believes this could unfairly undermine competing businesses. The NHS,
as the customer of these products, could then face fewer options, and higher prices or lower quality
offerings.

Sorcha O’Carroll, Senior Mergers Director at the CMA, said:

The NHS and the millions of patients under its care depend on critical behind-the-scenes technology to
ensure people are looked after and receive the treatment needed to get better.
This deal could see the NHS lose out on the benefits of competition, including innovation in these
products and services and getting better value for money. UnitedHealth has the opportunity to address
our concerns, otherwise it will progress to a more in-depth investigation.

UnitedHealth and EMIS have 5 working days to offer legally binding proposals to the CMA to address the
concerns identified. The CMA would then have a further 5 working days to consider whether this
address its concerns, or if the case should be referred to the next stage, Phase 2 investigation.