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Recent changes brought to the NHS procurement landscape as of January 2011


 

 

Latest changes

In April 2010, changes to the procurement process for the NHS were implemented which led to the creation of new bodies influencing the NHS procurement landscape.
  • The regional commercial support units (CSUs) are to provide support to local commissioners and providers, and encourage collaborative approaches to commissioning, procurement and contracting. The National Innovation Procurement Plan (DH, December 2009) clearly indicates that CSUs will endeavour to lead the regional procurement process, working alongside with SHAs and other regional stakeholders. More information is available in the ‘Commercial Skills for the NHS’ (DH, April 2010[1]): ‘CSUs will support commissioners in procurement and contracting for services provided to NHS patients and will support providers in understanding commissioning intentions and responding to tenders. CSUs will also support providers and clinical networks in the procurement of goods and services used by the NHS (eg pharmaceuticals and logistics), including driving better quality and value from the NHS Supply Chain’.
  • Strategic commissioning development unit (SCDU) within DH: the SCDU will work closely with regional CSUs to support the NHS in achievement of strategic commissioning goals. For example, SCDU will lead on developing resources to support PCTs in commissioning for priority disease groups and service sectors (‘commissioning packs’).
 In addition, National Arrangements were revised in order to pool resources and rationalise procurement activities:
  • Procurement Investment and Commercial Division (PICD) within DH: the PICD in the Department of Health has been created with an aim to bring the best commercial and investment experience into the health sector to achieve better economic value and improve patient care. PICD will provide expert commercial and procurement support to both the DH and the NHS and have a key system and professional leadership role encompassing oversight of the entire NHS landscape.

Implementation of changes

From the National Innovation Procurement Plan (DH, December 2009):
 
From April 2010 onwards
The focus is on implementation of the Regional Innovation Procurement Strategies. Working collaboratively with the National Innovation Centre, CSUs will develop pre-commercial procurement programmes and take resulting needs for a call for competition to the market.  CSUs will support system management and the Innovation Lead to identify and break down the resistors to adoption and diffusion of compelling innovative technologies, where appropriate utilising the regional Innovation Fund and the Commissioning for Quality and Innovation framework (CQUIN). Working with the commercial landscape on one hand, and the NHS landscape on the other, the CSU will then put in place the necessary arrangements to speed diffusion.
 

Consequences of changes for suppliers of medical device in general

For suppliers the recent changes in the procurement landscape should be seamless as they are mostly based on internal transfer of resources and internal training. The point of entry into the NHS for product sales will remain the same and the buyers should normally become more commercially aware and oriented towards quicker adoption (as long as compelling evidence and demonstrated benefits are available).Regional CPHs and local commissioners (PCTs) will be progressively supported by regional CSUs. CSUs will be themselves strongly influenced by the national SCDU to achieve national priorities such as supporting PCTs in commissioning for priority disease groups and service sectors (‘commissioning packs’) even if it involves redesigning care pathways (eg for assisted living solutions).Also, the distribution of sales amongst the five different routes to market will vary in the mid-term:
  • The overlap between framework contracts negotiated by the NHS SC and CPH was a source of concern and CSUs should progressively tackle this by clarifying procurement roles. This might lead to a stronger regional procurement route.
  • CSUs are to make CPHs more commercial- and entrepreneurship-oriented which intends to lead to a more effective procurement process and a stronger regional procurement route.
  • Assisted living is a growing trend and the national SCDU might produce Top-Down influence for the adoption of new services by local commissioners (eg home care services). This might lead to a stronger servitisation procurement route.
Specific consequences for suppliers of innovative medical devicesHow does this affect the adoption of innovation in the NHS? The DH ‘National Innovation Procurement Plan’ (DH, December 2009) describes their new regional technology-led innovation model which is intended to facilitate the adoption of innovation in the NHS and tackle the current barriers. An illustration is provided (Figure 13) and highlights the different roles of different public organisations in facilitating innovation uptake by the NHS.‘The National Innovation Procurement Plan produced by the DH in December 2009 seeks to bring clarity and coherence by organising the adoption of technology-led innovation at the regional level, pivoting around the SHA innovation lead located within each Authority. This approach is summarised in the diagram below.
 
regional-approach

Figure 13 Model developed by the DH to facilitate adoption of innovation in the NHS
(©2009, Source: Department of Health).
 

Each SHA holds a legal duty to promote innovation, raising the profile of innovation and encouraging a more rapid adoption of innovation throughout the health service. ‘Innovation leads’ are employed in each Authority to deliver this requirement.

Supporting this legal duty, an Innovation Fund has been created worth £220m over five years. Each region has £1.94m in the current financial year, increasing to £5m for each of the four following years. This fund will support faster innovation and more universal diffusion of best practice - innovation will be encouraged, recognised and rewarded.

Under the Commercial Operating Model, Commercial Support Units (CSUs) are being created in each region, and as part of their role, will support their innovation lead by providing a key interface between industry and the NHS. CSUs are expected to be in place by April 2010.’

More recently, in November of 2010, the Innovative Technology Adoption Procurement Programme (iTAPP) was launched. This programme encourages NHS-wide adoption of high impact innovative medical technologies that can increase the quality of care provided to patients, whilst reducing the overall cost of care. Medical technology companies are invited to submit details of specific medical technologies that would fall under the remit of iTAPP. More details can be found on:http://www.dh.gov.uk/en/Managingyourorganisation/NHSprocurement/DH_121248


It is also worth mentioning that the NHS procurement bodies are increasingly incentivised in considering carbon emission reduction opportunities as part of their purchasing decision-making process. More information about the ‘Procuring for Carbon Reduction’ (P4CR) Flexible Framework can be found on: http://www.sdu.nhs.uk/documents/publications/P4CR%20Flexible%20framework.pdf

1.1.4           Bodies of the procurement process having been dissolved in 2010

The English NHS Purchasing and Supplies Agency (PaSA) was dissolved in April 2010.Each of the other UK countries has their own NHS supply organisation and all except PaSA are still in operation as of April 2010: