NHS trusts will be asked to partly fund a price comparison tool that helps deliver savings in procurement, HSJ has learned.
NHS Improvement has confirmed the Purchasing Price Index Benchmarking tool will continue to be funded for another year, but trusts will be asked to help pay for its use.
HSJ understands trusts will pay between £2,500 and £3,250 depending on the size of their turnover.
The decision is at odds with the stance of the Health Care Supply Association, which represents NHS procurement professionals.
Its chair Alan Hoskins said the HCSA “remains strongly of the view” that the tool should be funded centrally.
PPIB was launched last year after being highlighted as a key vehicle for making efficiencies outlined in the Carter review.
At that time, trusts were told the tool would be provided for free as it would be financed by NHSI, though the two year contract was held by the Department of Health.
The system, provided by health analytics company AdviseInc, helps trusts identify where they spend more on products and suppliers compared to their peers.
PPIB is used by more than 150 trusts but NHSI said it will expand the tool to all providers.
The regulator will pay £200,000 - as part of the overall contract cost - and trusts will be asked to provide the rest of the tool’s funding.
HSJ understands individual costs for trusts will be determined in the following way:
- Trusts with a turnover of less than £300m will pay £2,500.
- Trusts with a turnover between £300m and £800m will pay £2,750.
- Trusts with a turnover of £800m or more will pay £3,250.
Sources have told HSJ PPIB has been seen as a “huge success” by NHSI, with more than 50 million purchase order lines uploaded from 156 different organisations, enabling the comparison of £4bn worth of NHS spending.
Trusts’ savings using PPIB
Examples of procurement savings generated through trusts’ use of PPIB include:
- Barts Health Trust saved £150,000 through renegotiating a deal for prosthesis with its supplier.
- Northampton General Hospital Trust saved £150,000 on implanted cardiac defibrillators after University Hospitals of Leicester Trust shared best practice on negotiating a better price.
- Taunton and Somerset Foundation Trust trained a team to use PPIB and subsequently developed action plans against each product group, resulting in savings worth £625,000.
An NHSI spokesman said: “The NHS price comparison tool has been instrumental in helping providers pay less for more than 2 million everyday hospital consumables.
“We are… asking [providers] to pay a small licence fee this year so that the entire NHS can benefit from full price transparency in order to get the best deals.”
Mr Hoskins said trusts have invested “significant time” in support of delivering the benefits of the PPIB initiative to the NHS.
In the event of trusts being asked to make a financial contribution, Mr Hoskins said the HCSA would encourage them to do so but added: “We remain strongly of the view that a national PPIB should be nationally funded on a ‘once and once only basis’ on behalf of the NHS.”
HSJ understands NHSI will shortly write to providers about PPIB’s funding.
The regulator is also formally taking over the contract with AdviseInc from the DH. The contract with AdviseInc expires in July 2018.