Solent NHS Trust
South Central trusts set up joint procurement scheme
FINANCE: Trusts in the South Central region are considering plans to set up an “integrated supply chain” in an attempt to save £358m over four years on procurement costs.
The neighbouring Royal Bournemouth and Christchurch NHS Foundation Trust is also involved, and has been appointed the “lead trust” responsible for a legally binding consortium agreement between the bodies involved and MedAssets, the service provider chosen to run the scheme.
According to a final business case put before Solent NHS Trust, all South Central trusts are involved except for Southern Health, Berkshire Healthcare, Heatherwood and Wexham Park, and the Ridgeway Partnership.
The document says that no single NHS trust is large enough to change a large supplier’s market share, and will therefore have to pay high prices for goods. “Tesco buys for all stores,” it says.
The business case also says: “NHS Supply Chain is often seen as a high price provider to be used only when preferred sources are out of stock.”
The integrated supply chain aims to deliver savings of 20 per cent of non-pay spend over a four-year term, excluding “secondary pharmaceuticals”. Cumulative savings are expected to total £358m. For Solent NHS Trust, that will amount to cumulative savings worth £10.8m – a return on investment of 7:1.
Under the terms of the agreement, all those taking part are required to channel 100 per cent of spend in the relevant categories to the project. Failure to route 95 per cent or more will result in financial penalties. Trusts will have to conduct internal monitoring to ensure there is no “maverick buying”.