What is a regulatory sandbox? And why is it crucial to the digital transformation of the health sector?

01 October 2019

What is a regulatory sandbox? And why is it crucial to the digital transformation of the health sector?

CQC has just opened their doors to the second round of their regulatory sandbox to promote innovations in healthcare, this time focusing on community care at home and AI for radiology and diagnostic services. The first round, which has already begun, is focused on Digital Triage.

 

So, what is a sandbox?

In a nutshell, a regulatory sandbox allows businesses to test products with real customers but free from usual regulations. This offers an opportunity to test new services or products where it is unclear at the outset which specific regulations would apply, and to understand where new regulation needs to be developed that is fit for practice to support necessary innovation.

Sandboxing and Regulation.png

Why would we need one?

Digital Transformation is crucial to ensuring that health services meet user needs and brings enormous potential to build efficiencies, cost saving and more personalised care. This is why transforming the NHS through digital services is a focal point within the NHS long term plan. But it is incredibly difficult to introduce new healthcare innovations in such a highly regulated space. Small businesses especially struggle to comply, as often it requires an established legal team to keep up with the changing regulation.

In a previous blog, we lay out the steps for digital transformation in health, which include considering regulation. If ignored throughout the design stage, issues are only uncovered once attempting implementation. On the flip-side, the regulation itself may no longer be fit for purpose given the rapid pace of the new technology – the fragmented way that digital technology is currently purchased and the number of regulatory bodies to comply with are two of the biggest barriers the NHS is currently facing to successfully scale digital solutions.

All of this can limit the impact that these new digital services could and can lead to a negative customer experience. For example, we recently conducted research with users of online primary care services, which revealed the issues that arise when these users need a referral for a physical appointment.

Regulation currently gets in the way of sharing data between their online GP and their regular NHS service, meaning users have to start from scratch, waiting for a new GP appointment to repeat the same story before getting the referral they require. These types of issues could be avoided if services were tested in a regulatory sandbox.

Does it work?

The concept of sandboxing was introduced by the UK regulator for the financial sector, the FCA. It has fostered the growth of innovation within the financial sector and has made the UK one of the best places to start a new financial technology business, despite it being a highly regulated space. The health sector is following suit: in February 2019, NHSx was created to drive forward the digital transformation of health and social care, testing and releasing new standards for introducing digital services within the NHS. It is within this context, with a commitment to healthcare digitisation, that CQC has launched its regulatory sandboxes – the first for healthcare in the UK. This will ensure that digital services are compliant with regulation, safe for patients and responsive to user needs, all of which will be crucial factors in their success.

What’s happening next?

The second wave of the CQC sandbox is open to applications until 28th October. Once started, it will include co-production, regular workshops, regular hypothesis and product testing and peer to peer learning, with a final report of all learning being published in March 2020. At Traverse, we’re looking forward to following the results of the first health regulatory sandbox in the UK.

In the meantime, as experts in Digital Transformation in health and social care, feel free to contact us if you would like to hear more about methods for developing, implementing and scaling tech-for-good and how to evaluate their impacts.

 

 

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