NHS Collaborative Procurement Partnership Total Orthopaedic Solutions Framework: an introduction

1. NHS Collaborative Procurement Partnership Total Orthopaedic Solutions Framework: an introduction Marc Osborne, Senior Workstream Lead Medical, Surgical & Supply Chain, NHS London Procurement Partnership

2. NHS Collaborative Procurement Partnership Agenda

3. NHS Collaborative Procurement Partnership The current NHS procurement landscape: • Fragmentation • Duplication • Price variation • Lack of transparency of data • Competitive rather than collaborative or cooperative players • Maverick shoppers at a clinical and trust level • Mix of private and public sector providers • Expanded and unsustainable product range • Atlas of Variation being developed by DH

4. NHS Collaborative Procurement Partnership The current NHS organisation landscape: • Specialties of clinical service • Geography/regional landscape • Differing types of trusts serving different needs • Strong and weak financial performance • Strong and weak clinical performance • Differing priorities • Differing maturity Differentorganisationsneed to engage differently at different times and this impacts on procurement.

5. Overview of non-pay spend in NHS acute sector (c£23bn) Healthcare from non-NHS bodies (£0.2bn) Miscellaneous (£0.6bn) Training (£0.3bn) Contract & Agency Staff (£3.5bn) Non-clinical Supplies & Services (£1.3bn) Consultancy Services (£0.3bn) Includes: cleaning materials and external contracts, food and contract catering, hardware & crockery, uniforms & patient clothing, laundry, bedding linen Premises (£3.3bn) Includes: Rates, electricity, gas, oil, furnishings & fittings Establishment (£1bn) Administration expenses e.g. printing, stationery, advertising and telephones Drugs & pharmacy (£6.5bn) Transport (£0.5bn) Includes: generic and branded drugs, medical gases and other pharmacy delivered supplies Includes: vehicle insurance, fuel, materials and external contracts Rentals under operating lease (£0.6bn) Clinical Supplies & Services (£5bn) Includes: medical devices and consumables, dressings, x-ray materials, laboratory and occupational therapy materials The NHS Procurement Efficiency Programme – Shaping Better NHS Procurement

6. NHS Collaborative Procurement Partnership We need to resolve, as the DH identified: • “Limited data on what is purchased by individual trusts” • “Trusts pay widely varying prices for the same items” • “No immediate way of examining variation in prices” • “No mechanism to secure commitment by hospital trusts” • “Trusts are often paying more than they need to, even for basic supplies” • “Some hospital trusts buy much wider range of key commodities than others” • “NHS….frequently establishing new contracts and framework arrangements which overlap and duplicate each other….” • “Variation between the highest and lowest unit price paid was around 10%” • “Much larger savings of up to 30 per cent in some categories” • “We [NAO] estimate that if hospital trusts were to rationalise and standardise product choices and strike committed volume deals across multiple trusts, they could make overall savings of at least £500 million…”

7. NHS Collaborative Procurement Partnership Our collaborative proposition: 1. Ability to deliver at pace and scale through local and regional networks and engagement, capacity, skills and expertise that is already there 2.Clear segregation of roles and responsibilities between procurement partners that drives optimal engagement and productive relationships for the greater good of the NHS and achievement of the Better Procurement and £2bn aims 3. Focus not on frameworks per se but on their operation to bring added value to the NHS • 4.NHS ownership of strategic contracting activity with local engagement. By the NHS for the NHS • 5. Optimal use of scarce resources usinghigh calibreprocurement expertise in existing regional procurement centres linked to local and national expertise • 6. Leverage what is good about what already exists and address issue in alignment with strategy • 7.Reduce duplication through one national NHS provided option delivered by one virtual party for each category

8. NHS Collaborative Procurement Partnership Expertise • Between us we cover in excess of 50% per cent of NHS trusts • Established links to CSUs and CCGs • CIPS qualified professionals with proven NHS experience Proven Expertise • Retained members ‘buy in’ year on year • Evidence of collaborative working • Track record of delivering despite the landscape Collaborative Engagement Proven • Not exclusive • Prepared to work with all for the good of the NHS • Ideally placed to educate and support Trusts to adopt and implement the aims Collaborative Engagement • Established and embedded networks at a Trust level • Trusted to engage through procurement and clinicians • Specialist clinical engagement practitioners

9. NHS Collaborative Procurement Partnership Our first collaboration success: the National Nursing Framework • Drives compliance: agency workers undertake same checks as substantive • Consistent pay rates across each region • Enables compliant international recruitment • Enables permanent recruitment in the UK • Anticipated spend over the life: £1bn+ • Went live May 2014, open to all NHS • Four regions: managed by each hub • 200+ EOI by suppliers • 120+ on site audits • 50+ stakeholders involved • 73 agencies for London • 71 in the EoE/Midlands • 59 in the North • 49 in the South • 20 for international recruitment

10. NHS Collaborative Procurement Partnership In summary: • Expertise • Track record • Collaborative and co-operative • Engagement – clinical and non-clinical • Established relationships across the NHS, from north to south • NHS-owned, working for the NHS • We are already working towards delivering £200m to support the £2bn • and • We have a shared vision for the future procurement landscape that can deliver for the NHS