- Trusts asked to use new savings tool
- NHS Digital to run price comparison service
- Incumbent provider plans to compete with new tool
NHS trusts have been told to switch from a widely-praised price comparison tool to a new in-house version in a bid to ramp up procurement savings.
HSJ reported in March that NHS Digital staff were working on a new piece of software, which aims to help trusts increase their savings by enabling them to compare their expenditure on products with other trusts.
It comes nearly three years after NHS Improvement ordered trusts to start using the Purchasing Price Index Benchmarking tool, which is provided by company AdviseInc.
Since then, the tool has been credited – by both trusts and NHSI – with saving the NHS millions of pounds. PPIB has provided accurate transparency of prices paid for expenditure worth more than £13bn across 1.5 million products, according to AdviseInc.
However, last Friday, every trust in England was told to switch from PPIB to the new tool when AdviseInc’s contract with NHSI expires in August.
NHSI believes creating and providing a price comparison tool in-house through NHS Digital will be cheaper and give the regulator better insight on where the NHS spends its money.
This insight could be used to “influence the market”, one source told HSJ.
The tool has been built by NHS Digital with the help of third-party software. NHSI said it could not say what third-party software had been used due to intellectual property issues.
In her letter to trusts explaining the move, Preeya Bailie, chief procurement officer for NHSI, said the new service would be “more cost-effective” and has “additional benchmarking functionality and analysis”, as well as being “faster and easier to use”.
The new tool has been tested by 30 trusts, and it is the result of a working group comprising NHS Supply Chain, NHS Digital and NHSI.
Ms Bailie said the new spend comparison service would bring several benefits, such as:
- No restriction on the number of accounts available to trust staff;
- The ability to upload multiple product codes, which means faster and easier pricing insight; and
- Better benchmarking analysis.
The annual price of accessing the software will be £3,300, a 5.7 per cent reduction from PPIB. This covers the cost of operating the tool centrally. In 2016, trusts were told they would not have to pay for the tool, but NHSI reversed that decision in the summer of 2017.
However, AdviseInc has indicated it will compete with the new tool for NHS customers.
In a statement to HSJ, Mat Oram, chief executive and co-founder of AdviseInc, said his company was planning a “number of enhancements” to PPIB which “will make us the most cost-effective provider of spend analytics in the NHS”.
“We’ll soon be delivering even better value directly to NHS trusts,” he said.
“The return on investment on our solution is more than 100:1 for a number of trusts.
“We wish NHSI all the best with their version of our service and look forward to them raising the bar… as they build on the solid foundations we’ve laid.
“For existing customers, we’re looking forward to continuing our work together and delivering local benefits directly where it counts.”
Information obtained by HSJ