The NHS is one of the world’s leading health systems for quality and the very best value for money; it is a national success story. But can it improve?
In May 2012 the Department of Health published a Best Practice Guidance document titled ‘NHS Procurement: Raising our Game’. The document states that the NHS can and must improve. It describes the actions that NHS trusts and the Department of Health should take to improve NHS procurement.
‘Procurement should be central to driving quality and value in the NHS’
NHS staff have needed to find or devise new tools and better ways of working to develop the NHS along the years to accompany the increasing demands it faces; a growing population with an extending lifespan; advances in knowledge, science and technology and ever-increasing expectations from the public. To meet the demands, stick within funding and at the same time improve quality, the NHS are looking to understand how better, smarter and more efficient procurement practices will help make savings.
Procurement has not been a priority over the years until the National Audit Office report demonstrated the scope for improvement and cost savings. The report drove a need to improve the way the NHS procure services and products to ensure patients get the highest quality care possible and add value back to the organisation.
‘The Government believes procurement can play a valuable role in both dealing with the deficit and stimulating growth in the economy’
Through improved procurement it is believed that there is a scope for the NHS to save £1.2 billion, but requires leadership at all levels and most importantly direction and involvement at board level to deliver these efficiencies and benefits.
Reports show that NHS procurement is lagging behind industry procurement performance and there is a need for trusts to collaborate, share data and harness the immense purchasing power that the NHS represents to improve their procurement practice and performance.
The document from the Department of Health calls for action to be taken immediately to make collaborative procurement a reality and have good procurement practice spread quickly and effectively throughout the organisation.
The need to improve procurement in the NHS was identified through the NAO report. A great deal of wasted money was found because of a fragmented system and lack of any formal mechanism. There was no correlation to volumes and the prices paid as trusts were charged different prices for the same goods, but also no set practice to assess value for money.
The NAO made a number of recommendations to improve NHS procurement:
Chief Executives of Trust want to:
NHS Procurement Professionals want:
To improve procurement and treat it as a strategic priority it requires action at all levels of the system, but most importantly at trust level. To deliver and achieve value for money the Best Practice Guidance outlines six areas of improvement which incorporate each boards aims.
The NHS need to review their practices and collaboratively work with procurement partners as well as the executives across all levels of the procurement system to ensure they align with business priorities.
The Trust should be gaining a better understanding of the improvements that need to be made to ensure improved coverage of data and contracts across the procurement system. Furthermore they should acknowledging the activities that need to be set against the Governments procurement pledge to drive and stimulate innovations in the procurement practice.
To improve procurement at all levels and help raise the game for NHS procurement; NHS Trusts should start by exploring contract management systems which can support the needs of the Trust but also enable them to have control of category management, price benchmarking, logistics, supplier information management and catalogue management.
An effective and efficient contract management system that is a central procurement platform for all levels of the procurement process will assist the shared access of information needed to collaborate departments, partners, suppliers as well as other Trusts. A central system will provide a hub to store all contract data and information to in turn drive savings and create longer negotiation times, so nothing gets missed in the process and patients can get the highest quality care possible.
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