NHS procurement reforms could save millions, say MPs

Millions could be saved for the NHS if health trusts reformed the way they buy products, according to MPs.

The Commons Public Accounts Committee said there was “poor” information over what health trusts bought and the prices they paid.

Their report came after a warning in February that around £500m a year was wasted in NHS procurement of medical supplies and basic items. A study of 61 NHS trusts found they bought 21 types of A4 paper, 652 types of medical gloves and 1,751 different cannulas (a type of medical tube). And more than 60 trusts made more than 1,000 orders each for A4 paper, every year.

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Trusts purchase items in various ways – dealing directly with thousands of suppliers through a national supplies organisation called the NHS Supply Chain, or via regional networks.

But the MPs’ report found the NHS Supply Chain was not demonstrating its value to the NHS.

“In around half of cases, products available through NHS Supply Chain can be more expensive than through other routes, and trusts are not using NHS Supply Chain to the extent that was expected when the contract was set up in 2006,” it stated. Regional purchasing structures were also “confused and lack transparency”.

The MPs warned that trusts – who have been tasked by the Government with finding £15 to £20 billion in the next few years – “will not identify procurement savings and will instead cut elsewhere”. This is despite the fact more efficient procurement “has the potential to save money without damaging patient care”.

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The 165 NHS acute and Foundation hospital trusts in England spend more than £4.6 billion a year on the procurement of medical supplies and other types of consumables.

The report said the Department of Health was committed to improving procurement systems, and saw the future for NHS procurement as a “pyramid” structure with national, regional and local procurement of different types of goods.

“However, this theoretical model does not reflect the current complex reality, with a profusion of bodies involved in the procurement process,” it stated.

All NHS trusts will also become Foundation Trusts by 2014, meaning they can act independently with no “explicit incentive to co-operate”.

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Labour MP Margaret Hodge, chair of the committee, said: “When resources are so tight it is simply unacceptable that money is being wasted by paying more than necessary on everyday products, from paper to surgical gloves.”

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