- NHS Improvement announces first tranche of standardised products to boost procurement volumes and cut prices
- Twelve products cover £100m of trust spending and could result in 25 per cent savings
- Regulator says it would prefer “coalition of the willing” to enforcing compliance through contracts
- Read the products list and NHS Improvement letter
NHS Improvement has announced the first set of standardised products all NHS providers will have to use from next year.
The products account for £100m of trusts’ annual expenditure and the regulator said savings of up to 25 per cent could be unlocked if providers committed to the scheme.
Lord Carter’s review of NHS efficiency found up to £700m could be saved by 2019-20 through better procurement if the health service used standardised specifications and catalogues to maximise volumes to get the best prices from suppliers.
Last week NHS Improvement’s new operational productivity directorate wrote to trust chief executives with the “first tranche of rationalised products”.
A procurement will be launched before the end of the year to select suppliers for the 12 products, which will then come on stream through NHS Supply Chain early in 2017.
“These products account for around £100m of trust annual expenditure and we anticipate savings of up to 25 per cent on current costs depending on market circumstances,” the letter said.
However, NHS Improvement said all trusts needed to comply with the scheme for the savings to be realised.
“For this to work, NHS Supply Chain needs to purchase on behalf of all providers so it is vital that you commit your volumes and don’t undermine the initiative by purchasing outside the contracts,” it said.
The regulator said it had found “change is effected more successfully when we work alongside you in collaboration”.
“Therefore, rather than immediately relying on more formal contractual or regulatory mechanisms to mandate compliance with this programme, we would very much like this to be a coalition of the willing with full compliance across the NHS.”
The letter asked trusts to identify any “contracts… that may delay your uptake of these products”.
NHS Improvement plans to expand the standardised list through to 2019 to cover “as much of the estimated £5bn trusts spend on products from suppliers” needed to hit Lord Carter’s £700m figure.
The letter said it will use the purchasing price index – a metric that compares trusts on the price and volume of the products they buy – to “identify non-compliance” from February.
NHS Improvement said it would “engage with non-compliant trusts to agree locally led actions to deliver full compliance”.