Five-point purchasing plan will help NHS save millions
Health procurement executives present steps required to think ‘beyond price comparison’ and drive health spending culture change
A five-point purchasing plan to tackle wasteful spending within the health service once and for all has been outlined by health sector procurement executives following the launch of the NHS price comparison website.
As BBH revealed last week, NHS trusts will now be able to compare the price they pay for goods and services through a comparison website. To coincide with the creation of the site, the Government has also announced the post of procurement champion, whose job it will be to improve overall purchasing systems within the health service.
But the move has received a mixed reaction from procurement experts, who claim it will only go ‘skin deep’.
Information is a vital part of the triage needed to understand the seriousness of NHS spending issues, but preventing further wasted money requires culture change, a strategy to set contracts at the right level and ensure buying is made easier for all
Plans to join up NHS spending data through a price index showing up to 50% variance in what is paid by trusts for many products does not provide urgently-needed change, claims Malcolm Preston, associate director of procurement at County Durham and Darlington NHS Foundation Trust (CDDFT).
Along with procurement software company, Wax Digital, Preston has outlined a five-point plan to realise spending efficiencies throughout the health service. They want to:
- 1. Evaluate national buying power - Rather than highlight price differences, evaluate national buying potential in common spend areas like swabs, sutures medical and surgical equipment/consumables to redefine prices
- 2. Segment strategy with 80:20 rule - Areas of little impact to health provision such as utilities, catering and office supplies represent around 20% of all NHS expenditure, but 80% of the savings potential
- 3. Massively reduce product choice - How many different types of medical and surgical consumables, pens, pencils and thousands of other standard items does the health service need? Money can be saved by massively standardising choice
- 4. Build a NHS ‘shopping platform’ - Ensure people buy the right product and the right price by building a single, simple online shopping system based on national contracts for common products across the entire health sector, eg single national contract for orthopaedic products (hips/knees)
- 5. Give national responsibilities to regional category experts - The NHS is well-equipped with procurement experts; look at who is achieving value in different spending categories and give them national responsibilities
Preston said: “Joined-up information is important, but the main problem is a lack of collaboration on contracts and people on the ground not buying from the right suppliers.
“One thing we need is a national online buying system - like eBay or Tesco.com - that drives a culture change by being really easy for everyone from nurses to catering managers to use.”
Having led the successful overhaul of purchasing for a consortium of 10 regional trusts, CDDFT has been able to eradicate wasteful purchasing and simplify its buying processes for thousands of staff through a simple buying system - Wax Digital web3.
Joined-up information is important, but the main problem is a lack of collaboration on contracts and people on the ground not buying from the right suppliers
Daniel Ball, director at Wax Digital, said: “Information is a vital part of the triage needed to understand the seriousness of NHS spending issues, but preventing further wasted money requires culture change, a strategy to set contracts at the right level and ensure buying is made easier for all.”
CDDFT looks after the healthcare needs of around 600,000 people. Its sourcing and procurement overhaul has enabled the trust to control spend, while improving patient care alongside clinical compliance.
