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November 18, 2010

New rules to govern vendor relations

Region policy is thought to be most comprehensive in Canada

The Winnipeg Health Region is introducing new rules to govern relationships with vendors of goods and services in a bid to enhance transparency and accountability.

Further Reading
Guiding principles
About the Industry Relationships policy


Arlene Wilgosh, President & CEO of the Winnipeg Health Region, says the new policy - thought to be the most comprehensive of its kind in Canada - will take effect immediately.

Region staff interact with health industry representatives in a number of ways, including sales calls, training programs, and off-site industry-sponsored events. In some cases, a vendor may pass along samples of a product, or offer a free training program or invitation to a seminar to promote their product or service.

While such practices are common in the industry, some health officials are concerned that they can lead to an appearance of bias or conflict of interest in business dealings with vendors. The Region's new Industry Relationship Policy is designed to eliminate the problem by providing guidelines to manage these interactions.

"Our objective here is to ensure we create a comprehensive policy that helps guide our business dealings," said Wilgosh. "The Region has an annual operating budget of about $2.1 billion and is a major contributor to the Manitoba economy. We need to have rules in place that guard against the perception of conflicts or bias and ensure taxpayers are properly served. This new policy helps us do just that."

The Industry Relationship Policy covers all Region representatives who deal with vendors, including staff members, staff physicians, physicians with privileges at Region facilities, management, executive members, and board members.

The policy is patterned after similar ones developed in the United States, but is much broader in scope, according to a Region staff member who helped create the new rules.

"Policies elsewhere cover relationships with suppliers of medical devices and pharmaceuticals," said Lloyd Baker, Internal Audit Manager for the Region. "But our policy will also apply to dealings with non-clinical vendors, such as accounting and legal firms, supply and construction companies, or anyone seeking to do business with the Region. That's what makes this policy the most rigorous of its kind."

The Region launched its vendor relations policy review in 2008 under the leadership of former President & CEO Brian Postl, who is now Dean of the Faculty of Medicine at the University of Manitoba.

At the time, there was growing public interest in the business practices of the health-care industry, especially in the United States where relationships between doctors, hospitals and medical suppliers were coming under increasing scrutiny. In one case, a congressional report suggested drug and medical device manufacturers were using payments or other gifts and gratuities to market their products and services.

In Winnipeg, the Region executive decided to take a proactive approach on the issue. A team of staff members was assigned to address areas such as gifts, distribution of samples, site access by industry representatives, industry support of Region programs and events and attendance at industry-sponsored programs.

One key outcome of the policy review was the decision to require staff and physicians working in the Region to fill out a conflict of interest declaration if they have an outside relationship with a vendor that can result in a conflict of interest situation.

Dave Rubel, the Region's Director of Internal Audit, says the conflict of interest declaration will help safeguard against any potential bias creeping into business dealings.

"The intent of the Industry Relationship Policy has always been to provide guidance and principles to help manage our relationships with industry," said Rubel. "By removing vendor influence and potential biases with vendors, we're trying to minimize the risk that decisions are made on anything other than merit."

Other key provisions in the new policy include:

  • Staff and physicians working in the Winnipeg Health Region cannot accept personal gifts from vendors, regardless of the nature or value of the gift.

  • Site access by vendors needs to be arranged through an appropriate Region representative for designated purposes depending on whether access is for patient care or non-patient care areas.

  • Drug samples can be used in ambulatory and emergency department settings under certain conditions. The use of samples that have been rejected by the national Common Drug Review may be prohibited.

  • Travel sponsored by industry for staff will only be allowed under specific circumstances.

  • Off-site industry-sponsored events that are legitimate educational, training or learning opportunities can be attended by staff once appropriate approval is obtained.

In developing the new policy, the Region had to walk a fine line between creating a transparent set of rules and creating unnecessary red tape and expense. For example, the new policy says Region staff cannot accept personal gifts. But what if someone drops off a box of chocolates for nurses at a hospital?

"Our policy does not allow individuals to accept gifts for personal use," says Rubel. "However, gifts of a low value (e.g., a box of chocolates from a grateful patient) that can be shared among staff members in a department or ward can be accepted on behalf of the staff in that area."

Rubel said there is no question the guidelines will take some getting used to. But he says the long-term benefit is the Region will have a transparent process with clear rules.

The Region's new Industry Relationship Policy is line with the University of Manitoba's Faculty of Medicine's policy on industry relationships implemented in 2009. The Region's Conflict of Interest policy has also been updated to align with the new Industry Relationship Policy.

Guiding principles

In order to establish a basis for policy positions with respect to industry relationships, the Region developed guiding principles that form the underpinnings of the policy. They include:

  • Demonstrating leadership among regional health authorities in an approach to relationships with industry.

  • Promoting a culture in which Region representatives can exercise independent, unbiased judgment in all activities while interacting with industry.

  • Encouraging healthy and ethical relationships with industry that enable the Region to deliver optimal health-care services.

  • Maintaining public confidence in the quality of care and evidence-based treatment provided by Region health-care providers.

  • Diminishing the possibility where one or more vendors have an unfair advantage over others in dealings with the Region.

  • Upholding Code of Ethics statements articulated within relevant professional associations' codes of conduct and/or by-laws.

  • Encouraging transparency by Region representatives with the organization and with patients, clients and residents in their dealings with industry.

  • Requiring proactive disclosure where industry relationships might create or be perceived to create a conflict of interest.

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