Two low-profile tech companies are locked in a dispute that could have big ramifications for New Zealand’s health sector.

HealthLink, which provides the network that enables patient data to be transferred electronically, has lodged a complaint with the Commerce Commission over proposed fee increases by health software provider MedTech Global.

Listed on the ASX, Medtech is an electronic medical record (EMR) vendor that supplies software systems to about 85% of New Zealand’s 1200 general practices.

The two companies have had a commercial relationship going back 15 years to when HealthLink was formed as a public-private partnership under the previous National government; back then MedTech was known as Australian Healthcare Technology Limited.

And although it is itself a monopoly, HealthLink says it is MedTech who is now engaging in “monopoly pricing”.

The dispute relates to an electronic referrals (eReferrals) system launched two years ago that enables GPs and specialists to send patient referrals to their local District Health Boards (DHBs).

HealthLink has been charging DHBs a fee of $50 per GP per month and paying MedTech a fee of $15 per practice per month for an electronic link to its software.

However, Healthlink says MedTech is introducing a new licence fee of between $42 and $82 a month per practice, representing a fee increase of between 180% and 450%.

It says it will not be able to complete the rollout of the eReferral service without significantly increasing its fees to either DHBs or GPs to cover the increased charges.

MedTech’s price hikes will cost the already-struggling health sector between $4 million and $8 million a year, HealthLink claims.

“We are extremely reluctant to increase our fees to the health sector in order to support what are, in our view, unjustifiable demands and anti-competitive practices,” HealthLink chief executive Tom Bowden says.

“Medtech Global has made it clear that unless the fee increases are met, they will block HealthLink’s ability to exchange New Zealanders’ health records between healthcare providers, rendering it impossible for HealthLink to transfer many of the one million items of information it exchanges each week.

“In essence, Medtech is trying to control who has access to New Zealanders’ private medical information, as they attempt to impose this major cost increase on the health sector.”

He says analysis of trial projects such as eReferral is showing 20%-40% improvements in efficiency, and says agreeing to MedTech’s demands by raising fees to DHBs and GPs would price such services out of reach.

MedTech Global says it is “disappointed that a professional health technology provider has chosen to take what amounts to a commercial disagreement into the public arena”.

It says it will co-operate with any Commerce Commission investigation.

MedTech chairman Vino Ramayah says HealthLink asked his company to join it in a commercial bid for an open tender but MedTech told HealthLink “it is unable to support the proposed HealthLink centralised architecture that restricts choice in terms of messaging carrier for its customers”.

He says HealthLink currently accesses MedTech’s practice management systems through GPs.

“This system is not affected by the current dispute and GPs should have no concern that the current messaging system will be disrupted,” he says. “HealthLink’s suggestion Medtech will block its access to medical records is wrong.”

Mr Ramayah says the dispute is about pricing relating to the tender and “Medtech stands by the confidential pricing that it provided to HealthLink in order for it to bid for the tender.”