What Happens With Value Purchasing?


Oli Hudson, Content Director at Wilmington Healthcare, reflects on the phrase of the moment in procurement circles – what does this actually mean for medical technology?

One complaint about the NHS, which many medical technology providers I have worked with over the years maintain, is the service’s obsession with short-term cost versus long-term value.

It’s an issue that at least some parts of the NHS seem to share, hence the current vogue for value-based sourcing (VBP) ideas.

Value-based healthcare has been around the concept for at least a decade, starting Sir Muir Gray’s Right Care program in the early 2010s, when he linked the resources used with the results obtained, focusing on unjustified variations. and waste reduction.

VBP now has a definition accepted by academics and the NHS supply chain that emphasizes two things: a purchasing process that ‘creates opportunities to release capacity’, and that it should ‘provide tangible and measurable benefits that positively impact patient care and increase efficiency. ”.

A paper from the NHS England Board of Directors in 2017 explored how GCCs could benefit from a value rather than a cost based approach. Then, in 2019, he stepped aside in the purchasing world – with NHS Supply Chain appointing a VBP manager – Brian Mangan – and commissioned a report on how the approach could benefit systems.

Publication of the report was suppressed during most of the pandemic. When he finally arrived, he found three critical success factors:

  • clinical support and engagement – critical to uptake of PBV
  • a need for a common understanding of value between buyers and suppliers
  • Provider insurance to substantiate claims VBP adoption assistance for NHS trusts

If properly understood by both the NHS and the providers, could the VBP then offer a promise to both parties for the future?

New impetus for VBP – via systems

The NHS from April 2022 will be divided into 42 integrated care systems. These are integrated purchasing bodies – bringing together local authorities, former clinical commissioners and hospital trusts as service providers – and are entrusted, via the reform of the healthcare procurement system of 2015, with a new mission to organize services in the healthcare sector. best interests of patients, taxpayers and the public. Population health approaches should be the norm and, of course, this provides an opportunity to examine value for the entire patient population across the system.

The current legislation means three things to note here. First, it forces hospitals to work together as local partnerships to secure contracts. This means they can look at the allocation of resources with a broader focus and not have to compete to keep resources at their own cost centers. Local partnerships are also likely to bid collectively and more generally engage in joint procurement.

Second, these services will be paid for out of an overall budget, rather than activity-based payments like before the pandemic, giving providers some leeway in the face of day-to-day cost pressures. Going forward, contracts will likely be paid for using a holistic / blended approach, meaning that trusts have a secure funding base, but also incentives to deliver value and / or results.

Third, the legislative proposals shift their emphasis from cost to value. Taken as a whole, the time is ripe for VBP than at any point in the past decade.

Support and clinical commitment

The NHS supply chain report concluded that clinical support and engagement was essential for VBP – and this is yet another synergy with the new health and care bill, as the legislation emphasizes also that leading the charge of transformation in a given “place” – a place of 300,000 to 500,000 people – should be clinicians. Across the NHS all pathways are being transformed and this should not happen without intensive engagement from the clinical community. New avenues lead to a need for new technologies, and this is when imaginative new purchases can take place.

Cardiology supply makes PBV real?

Let’s look at an example of the cardiology supply. An immersive piece in HSJ from October 21 covered a recent collaboration between the South London Cardiac Operational Delivery Network (ODN) and NHS Supply Chain.

The project brought together cardiologists from the five centers in a “clinical board” to improve the supply of percutaneous cardiac stents, and presented evidence on the various stents on offer obtained by surgeons in real time.

It had a real impact – the process led to a reduction in the number of vendors from 12 to two, and a projected savings of 30% of total device spend across the five trusts – Guy’s and St Thomas’ Foundation Trust, King’s College Hospital FT, St George’s University Hospital FT, Lewisham and Greenwich Trust and Croydon University Hospitals Trust.

Spending on stents was expected to drop from £ 4.5million per year to around £ 3.2million per year. This is the kind of clinician-led, value-based supply that NHS England will want to see. Many more examples of this type of project can be found in the NHS Supply Chain VBP Project Report and Findings. As a result of the review, thirteen pilot projects are underway, in the areas of capital goods, cardiology, endoscopy and endourology, in-service consumables and wound care.


If, as seems likely, VBP gains a foothold in the mindset of local buyers, medical technology will need to heed the advice from the NHSSC review and ensure it aligns with these three critical success factors.

First, when trying to influence local procurement, especially the use of a new device in a new clinical journey, clinical engagement must be sought. It should be aligned with the industry on the objectives and should use the widest possible range of stakeholders through the territorial partnership, supplier collaboration or the system.

Second, providers need to ensure that their goals – likely to be patient outcomes – align with those of the target system, location, and journey.

Third, there is the point about the evidence – that any claims offering value to the systems, involving these patients and the costs (or savings) involved should be readily available and based on fully costed business cases – and of course should be understood and evaluated by the clinicians with whom medtech is committed to advance innovation.

If these three areas are targeted, then VBP may well prove to be a useful concept for medical technology in the coming years.

Wilmington Healthcare provides medical technology information, data and advice to navigate the new healthcare and purchasing landscape. For more information please contact marketing@wilmingtonhealthcare.com.

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