The government plans a brave new world for public health.
GP buying power will drive competition for services from trusts.
This will in turn, increasingly require competitive sourcing of all goods and services for effective care delivery and efficient operation.
GPs face a significant challenge: they must achieve new heights of financial efficiency. GPs must torch-bear best value combining price competition with effective health service delivery. They’ll need collective buying power but also the ability to source best value services.
There are approximately 10,000 GP practices in the UK today, and if each county had one single consortium, each would have on average, 150 practice sites. Technology would need to deliver a means of sharing contracts and purchasing easily in order to reduce maverick spend, restrict choice and respect clinical direction.
Can 150 GP practices agree on one set of contracts with NHS trusts? This is a major services sourcing job.
Trusts will be challenged in extending their purchasing processes because many are yet to find efficient ways of managing spend. They cannot just let PCTs plug and play in to their spending processes. Software licensing costs and project reengineering could exacerbate the issue, with mergers triggering unavailable time and resources.
There are opportunities for improvement, however.
A one way health supply chain could drive the efficiencies the government is looking for. The right motivations - to deliver best value health, price competition and patient needs - could resonate right down the chain to the correct choice of goods and services. It is a bold step and a universal mindset shift, but it could mean better defined care pathways as well as financial savings.
County Durham and Darlington Foundation Trust has spent ten years rationalising purchasing and building an ecosystem that all trusts in the region can use. It now has the power to expand this quickly and seamlessly - but it took a decade to design and implement.
Malcolm Preston, CDDFT’s associate director of procurement, said: “The proposed healthcare provisioning changes could offer trusts huge opportunities for efficiency and best practice, but there will be major challenges in terms of time pressure to get it right.”
The practicalities of such changes to the sector must be explored carefully if both GPs and trusts are to take the right steps in their new sourcing and purchasing roles.
Collaboration is a major practical consideration. We are yet to see exactly how the government will direct GPs in the development of consortia but they will certainly need to work together. It is likely that various styles of collaboration will evolve, some independent GPs merging into super clinics whilst others remain more autonomous. Either way, collaboration will be critical to effective provisioning. Trusts following the example of pioneers like County Durham could achieve new levels of procurement efficiency at the supplier coalface.
A major part of collaboration will be unlocking procurement skills across the NHS. We need to start utilising the same level of buying and negotiation skills that exist in commercial organisations. GP consortia may well need to employ procurement specialists and trusts will need use automation to reduce the administrative burden placed on its purchasing teams so that they have time to offer strategic direction and planning.
Another practicality that must be ensured in effective procurement is a focus on people. Where new purchasing platforms are adopted to ease the process of buying on contract and reducing administration, these must provide a personalised and intuitive approach. Many new people may be required to use these systems to achieve contract best value and the easier it is for them to do so, the better. Developing a customised approach and personalised systems similar to online retail will encourage compliant purchasing far and wide.
Finally, consideration must be given to the supplier. They are an equally important part of making the supply chain work effectively. If trusts are to drive best value from suppliers in contracts they must become easier to do business with. Utilisation of standardised PQQs for all contracts and regular ‘meet- the-buyer’ events that offer a chance for familiarisation and networking, can help. Technology platforms can also be extended through the use of supplier portals which automate invoicing and ordering, reducing supplier overheads and encouraging greater commitment.
If managed correctly, the new health supply chain is an opportunity to bring greater buying power and savings into a less divided National Health Service. If not managed correctly, it could fragment the service into factions that work against one another and put cost reduction in front of patient care.
Daniel Ball is director of Wax Digital