NHS trusts 'taken advantage of' over procurement

NHS chief executive and industry experts warn trusts will be ripped off unless they collaborate over purchasing

Suppliers will be able to take advantage of the NHS unless trusts work together to procure goods and services, experts are warning.

The concern was voiced by NHS chief executive, Sir David Nicholson, to an audience of senior leaders at the recent NHS London Procurement Partnership (LLP) annual conference.

He said: “Without sharing data, suppliers are in a position to take advantage of NHS organisations. Variations in prices paid are remarkable and unacceptable.

“Some leaders think they don't need to work collaboratively to improve procurement. They need to think again.”

Without sharing data, suppliers are in a position to take advantage of NHS organisations. Variations in prices paid are remarkable and unacceptable

Delegates also heard from NHS managers who have worked in collaboration with other trusts and with industry to successfully reduce costs and improve procurement processes.

LLP chairman, David Sloman, who is also chief executive of the Royal Free London NHS Foundation Trust, said the partnership was working to produce savings in excess of £300m to its member trusts over the next three years through collaboration and the sharing of best practice.

And Mario Varela, LPP chief executive, revealed that for every £30,000 saved, trusts could employ an additional full-time nurse.

Commenting on its efforts to improve procurement processes, Steve Ryan, medical director of Barts Health NHS Foundation Trust, said: “With the support of LPP, the Barts clinical procurement group reassessed the contract for the provision of ICDs and pacemakers, taking benefit of market share incentives built into the contract. We cut costs by £1.2m a year without cutting the quality or safety of products being used by clinicians."

Some leaders think they don't need to work collaboratively to improve procurement. They need to think again

Steve McGuire, director of Essentia at Guy's and St Thomas' NHS Foundation Trust, added that working together to improve the management of waste disposal not only saved London trusts £5m, including halving the cost of clinical waste disposal, but also identified an opportunity for the trusts to profit from turning waste into energy.

This has led to renewed calls for trusts to stop working in silo and to collaborate locally, regionally and nationally by sharing data.

Sloman said: “Sharing data is fundamental to enabling NHS organisations to properly benchmark spend. Improving the quality and transparency of data is fundamental.”

The LPP is poised to launch a benchmarking and spend analysis service later in the spring that will help trusts to make improvements and drive change.

By working together we improve procurement and make sure we can deliver the kinds of efficiency gains and quality improvements that we need. This will help to ensure we continue to have a sustainable NHS, free at the point of use, universally available for all patients

Chelsea and Westminster Hospital finance director, Lorraine Bewes, said the service would support members to unlock the potential of procurement to avoid organisations falling over their own 'fiscal cliffs' - in Chelsea and Westminster's case, a 5% QIPP saving for the foreseeable future.

Sir David concluded: “The NHS is facing an unprecedented challenge to meet rising demands for healthcare, driven by an ageing population against a backdrop of tight budgetary control. All the evidence shows that collaborative procurement across the system gets better services and equipment for patients, quicker.

“By working together we improve procurement and make sure we can deliver the kinds of efficiency gains and quality improvements that we need. This will help to ensure we continue to have a sustainable NHS, free at the point of use, universally available for all patients."

Companies