NHS trusts need to think differently about equipment procurement

Jason Long, business development manager at leading vendor independent equipment solutions provider Asteral, welcomes the recommendations set out in the report produced by The Public Accounts Committee into equipment procurement in the NHS. He agrees that millions of pounds could be saved in the procurement and operation of MRI and CT Scanners plus Linear accelerator machines but highlights that Trusts need to start thinking differently about how they procure, manage and maintain high value medical equipment.

Finding 1. The Department is not achieving best value for money when it purchases high value equipment and there is no clear accountability for maximising value in the purchase and use of such equipment.

There are many factors to consider when purchasing high value equipment, requiring a combination of clinical, financial and technological expertise to make the right decisions and offer best value for money. A vendor independent provider can deliver a bespoke equipment package that delivers value throughout the whole life cost of a product, delivering a complete solution to encompass not just the procurement but also the essential activities such as training, maintenance, consumable supply and decommissioning. These solutions deliver a lower whole life cost than either leasing or capital purchase with lifetime maintenance.

Finding 2. The NHS lacks adequate information on MRI and CT activity to compare performance between Trusts and to drive improvements in efficiency.
There are many barriers to collecting information, including numerous suppliers managing and maintaining their own equipment and a lack of joined up thinking between departments and Trusts. A vendor independent management equipment solution will provide detailed reporting and assessment of equipment, including benchmarking of performance and price across the providers entire install base, informing procurement decisions and identifying efficiency savings.

Finding 3. Some trusts are not using framework agreements, which would allow them to buy the same machines more cheaply. Frameworks have an important role to play in helping the NHS to meet efficiency targets and should be considered alongside all other options to ascertain which achieves maximum value for a Trust’s specific requirements. Again, it is important that Trusts consider the whole-life costs when making procurement decisions, not just the list price – whether that be direct or through a framework.

Finding 4. The NHS is not taking advantage of bulk buying to achieve discounts, which is a missed opportunity to contribute towards £20 billion efficiency savings. It is difficult to coordinate purchasing cycles and requirements across enough Trusts to make bulk buying effective. However, vendor independent providers such as Asteral can leverage their significant buying power with manufacturers to ensure that fit-for-purpose equipment is acquired for the best possible price. This, taking into account the important whole life costs of equipment, can deliver further savings to Trusts.

Finding 5. NHS Supply Chain’s objective to save the NHS money is at odds with how it is paid. By charging a percentage of the equipment price, the focus is on procurement rather than the whole life cost and, as the report states, removes a key incentive to deliver better rates from manufacturers of equipment. Equipment solution providers to the NHS need to focus on delivering efficiencies for the short and long term, delivering value across a Trust’s operations supported by key performance indicators and guarantees.

Finding 6. It is unclear if the NHS can meet growing patient demand for scans and radiotherapy services at the same time as having to deliver substantial financial savings. Revenue solutions that allow Trusts to acquire new and replace existing equipment without any upfront capital investment are now easily available. Managed equipment solutions offer both scalability and flexibility to ensure Trusts can equip themselves for changes in patient demand. Good equipment management strategy delivers efficiencies and increases flexibility whilst ensuring delivery excellence. This helps Trusts to retain services, which can create further revenue generating opportunities without requiring any extra investment in equipment.

In conclusion, equipment plays a critical role in the NHS today, the management of which can have a significant impact on the performance and financial position of a Trust. Outsourcing the management of equipment to a specialist services provider can deliver measurable efficiency savings and is therefore growing in popularity amongst Trusts. It transfers risk to experts, allowing clinical staff to focus on their roles whilst delivering efficiencies to meet tightening financial briefs. It is important for Trusts to consider and evaluate all available options to ensure that they’re able to meet efficiency targets whilst remaining competitive.