Lord Carter’s Best Procurement Practices: The NHS Spend Toolbox

7th June 2016

Lord Carter stated in his last report that a total of £5 billion savings per year in the NHS could be possible by 2019-20. The Carter Review found £9 billion was spent annually on procurement in the NHS. In order for Trusts to cut back on their spending and contribute towards Carter’s predicted savings, they must equip themselves with the correct tools.

Tackle the nemesis that is Services Spend

Having a catalogue that is accurate, with good data quality, is still only going to take the NHS so far in reaching Lord Carter’s report goals. Acute hospitals show an average of 20% non-pay spend and for Community/Mental health services, this rises to 80% that fall under the category of ‘services’, which are notoriously difficult to track, monitor and manage.

eCatalogue Suppliers provide various means of being able to capture service items with differing success. Some provide pseudo catalogue items that represent the services supplied but this method can require large volumes of items to be set up and maintained to cover off the various combination of services that are ordered. Others offer flexible forms to allow you to add data items to the form to capture additional service information. However, this doesn’t address the true complex nature of service ordering.

Advanced procurement software can provide a procurement process that has built-in logic to allow the service to be configured (and priced) as the user enters information. This not only helps address the capture of the right information but also allows services orders to be transmitted electronically and accurately invoiced, overcoming some of the huge inefficiencies in this area.

Example: When a Trust needs to organise the disposing of a mattress, many factors must be considered so that it is disposed of appropriately. Having an electronic form replaces the verbal conversation and documents the process, meaning the service can be tracked and the Trust can be correctly invoiced.

Apply some Scientific Analysis

There are also a number of Analytic tools that can help the NHS identify further areas of spend management. Some simply present the information back to the NHS in a generic consolidated form which can be useful, however, being able to apply more intelligence as part of the process is essential for tackling the real areas where savings can be made.

Look for solutions that offer data cleansing into a Trusts own taxonomy, full supplier normalisation, normalisation of payment terms and procurement data enrichment.

There are also areas of specialist spend that procurement providers have tackled as part of their overall solution set which help to increase the amount of tracked, catalogue and controlled spend for the Trusts.

Example: Diagnostic services are critical to the effective operation of acute Trusts; dedicated solutions such as Science Warehouse’s eOligos ensures they can operate efficiently with easy ordering of custom DNA sequences which are used in cancer diagnosis.

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