NHS needs it's own Amazon.

[Bollindger]

I often wondered why this has never been done.
If medical supplies were brought and stored and dispatched on an Amazon style system, that any health care facilities could access , the NHS could save Millions, even down to light bulbs and cheap paracetamol, after all if Tesco can do Paracetamol for 50p so could the NHS. Also Amazon can deliver overnight, so that would mean Hospitals would have to carry less stock.

😂

Tomorrow's topic is DIY brain surgery in association with Screwfix. 😀

Huh, the only failures I have seen in NHS Supply chain is when politically appointed Chancellors of the Exchequer and/or Health Secretaries (always an MP with zero professional qualifications or experience in Procurement) get a “bright idea” and then forcefully impose it on the Procurement professionals in the civil service.

The biggest and most expensive failure in recent history was the PFI- Private Finance Initiative. The fallout from which we are still paying off. All warnings from professionals was ignored by both John Majors Conservative government who initiated it and Tony Blair’s Labour government who greatly expanded it. The Coalition government then was in denial saying Labour “misused” PFI as a way to dismiss the unfolding financial disaster they’d been warned would happen, and the government kept it fucking going! And even though thankfully PFI was eventually discredited and dropped around 2016, the NHS repayments on this debt is 2% of the entire NHS budget, accounting for £2.2 billion in 2019–20 and rising each year to to a peak of £2.7 billion in 2029–30.

And we didn’t get good prices either. An investigation by Professor Jean Shaoul of Manchester Business School into the profitability of PFI deals based on accounts filed at Companies House revealed that the rate of return for the companies on twelve large NHS PFI Hospitals was 58%!

58% profit margin is daylight robbery.

😂

I’d have a lot of explaining to do if I was buying paracetamol at 50p a pack. That’s extortionate.

Unfortunately the procurement system elects to use preferred suppliers. Companies compete to become preferred suppliers because once on the list they can basically charge what they want. I know someone who works in procurement. She says that they could save millions of pounds if they could buy on the open market. For example, paper and stationery, she can buy for sometimes half the price off Amazon but is unable to do so.
Procurement was set up to meet quality control which is important but it does not allow open market competition. The procurement officers are so far away from the frontline that they often fail to understand the relevance of some requests.
For example, latex free is very important and some think as long as the examination gloves are latex free all is ok, but surgical gloves are much more expensive so most are latex. The same for most sleeves that go over equipment that cannot be sterilised (ultrasound probes )
For someone like me ( an HCP) who uses products with latex and as a surgical patient recently, any latex item can cause a severe reaction, possibly anaphylaxis.
Many HCPs are latex sensitive, in fact many have had to retire as a result of it, latex free has to be complete latex free, not just gloves.
I had a thyroid biopsy a few years back and the chaos it caused because there were no surgical gloves or probe covers was comical. They eventually had to go to the staff canteen to borrow the cling film.
Procurement should be localised and controlled by clinical staff who understand needs, but also budget controlled so staff at ground level understand the cost implications of unnecessary waste.
I work in dentistry where we work in this way, limited budget for materials but free reign to choose which products we use and the ability to get them for the best price. The staff are well aware of the cost of materials and because we monitor stock we can see if there is unnecessary waste.

but those are still costs that occur
when the dr says you need paracetamol but its cheaper if you buy it - then the dr still needs to see you and tell you to get it. You do the bit about going to get it.

? 1 contract per item? That’s ridiculous and the most illogically inefficient way to procure goods and services. So with your give the suppliers the NHS funds direct how can you divide it up between the millions of contracts without any procurement department or accountants at all?

If I buy a roll it costs me 50p. If buy 4 it is £1. if I buy 12 it is £2,50.
If i am using that many rolls, then I purchase an oven and make the rolls myself and have lower cost per item and simply hire someone else to make the items ending up with rolls costing me 10p each

This is rarely true these days because a bakery who supplies millions of rolls to tens of thousands of customers will have greater economies of scale than any one hospital with a baker and oven and some bags of flour. Their prices will usually be lower than the cost to do it in house.

You obviously don’t know that part of the job of Procurement professionals is to do all the research and calculations of doing a job in house vs contracted out for every requirement and then propose which is the most cost efficient way to go? This is looked at internally before any decision is made on advertising for contract offers.

@Angrymum22
Procurement should be localised
It used to be and the centralised supplier schedules still existed so you’d get the quantity discounts for most things and local procurement reps could justify buying off schedule if could find it cheaper, better quality, or faster.

So the problems you have faced are real and caused by centralising the Procurement office/people…which was done to cut staff and save on “admin costs” (non frontline NHS jobs are always devalued and first to have staff cuts). But again, this was a cost saving “bright idea” from a politically appointed MP who imposed it to get a “I made the bloated NHS administration more efficient OBE”

🤣

Can I add “tell me you don’t work in manufacturing without telling me you don’t work in manufacturing”.

Manufacturers specialise in what they do. There is a reason that Tesco, for example, do not make their own brand food themselves.

How many people do you want to employee in the NHS? See the current recruitment crisis in factory employees - do you want them to deal with that? Or leave it as my problem? (losing money because I have to pay more but I’ve signed a contract with you). Similar with truck driver costs shooting up.

What about my factory in France which has had half its production stopped overnight because the river level is too low in this heat? Production uses a lot of water. Do you want the NHS to employ people who negotiate with local authorities on such matters?

On that water… do you want the NHS to employ people who specialises in closed loop system to recapture water on site? That costs money.

What if there’s new legislation than your toilet paper must remove x bleach or have y % of proven auditable recycled material? Do you want to employ someone in the NHS to drive that change through?

And on raw materials… shall we employee procuring specialists in the NHS to hedge against prices on the global market for paper?

Finally what makes you think the NHS is really that big a consumer of loo roll on a global scale? They’re really not. So they’ll never get the economies of scale of a specialist global manufacturer. They get the best price by leaving all of that to experts.

As a former NHS-et thank you for this! Has made my morning

Not sure why I read rolls as toilet rolls not bread rolls 🤣 but all my points still stand.
Good luck to the tiny NHS on the huge and complex global commodities market for flour…

Actually I used to work in Purchasing and did save my company a lot of money buy using common sense. We would walk into town in our lunch hour and buy things and get back petty cash for the item, rather than ordering it from a big company any getting stung with delivery costs, and I had a Multi Million Pound budget in 1988. I do understand how contracts work and was taking the purchasing of an item as an example only.
Also I am not wrong about the fact there are ways savings can be made, maybe the buyers should listen to the end users more, as some people really do come up with stella ideas that could save millions if applied to all of the NHS, Maybe they should offer staff a bonus on how much their ideas saving if implemented.

@Maybeebebe not really, because the costs of shipping, storing, dispensing, procuring, managing the contracts, admin within NHS are saved by you just buying the paracetamol. At least for the NHS as there's no prescription and the 'background' costs are on the supermarket/shop you buy the product from rather than the very limited resources of the NHS.

It's the same with the 'free' childrens medicine scheme, it actually cost a lot more than the item to supply it to you. What would cost you maybe £1 actually costs the NHS a lot more. Even the prescription fee doesn't truly cover what it costs to prescribe and dispense the medication.

I have very much simplified this, but there is lots of information available if anyone wants to dive deeper.

Was that private sector purchasing? Also, 1988 was some time ago.
Public sector, which includes the NHS has very strict regulations and a requirement for transparency. If public sector organisations just nipped down the road there would be a massive fallout because that goes against the principles of public procurement of open, fair, transparent.
You would have suppliers taking them court, incurring huge legal fees as well as fines. Not everything is about just getting it cheaper, risks are assessed such as supply chains, demand and availability, quality control, risk of supply chain failure, risk of legal challenge and legal action. If the NHS was suddenly unable to procure any kind of medication or supplies it would have a huge, very costly effect.

Amazon simply wouldn't work for this. It's not just about supplying drugs or "widgets"
A lot of medical devices require significant training and ongoing clinical support.
Do you really want your hip replacement being done by someone who's half read some IFU's?

As a pp pointed out that is private sector purchasing which has far fewer regulations and transparency requirements compared to public sector procurement. It was also 1988…a lot has changed people aren’t paging through Rolodexes and phoning local suppliers to fax quotes to them and so on. Petty cash doesn’t exist. Contract law has certainly changed massively.

It also sounds like you were buying for a single shop/location. You weren’t, for example, a category buyer for nationwide procurement covering thousands of locations. So you don’t have experience with the scale & complexity of procuring for something like the NHS.

Of course you are right in that there is always opportunity to improve procurement in terms of savings or quality or ethical buying. But I do know that buyers do listen to end users. I know for the NHS, they have had huge staff cuts to procurement that the buyers don’t have the time or ability to listen as much as they used to be able to do. Plus each buyer will be representing thousands of HCP end users, so that presents a further challenge when HCPs from different trusts can’t agree on requirements.

The NHS has so many millions of moving parts and the procurement teams do an excellent job of making sure they have what they need when they need for the most part. It is not a simple system because it can’t be simple. It’s not the same as ordering a pack of pencils from Amazon ffs.

“Actually I used to work in Purchasing”

That surprises me, as most people I know in supply chain, procurement and manufacturing would say, “can someone tell me how it works in the NHS?” before declaring that they have all the answers.

You’ve just done the opposite of your own suggestion of listening to the people on the ground.

Yeah, I only know the barest outlines of how it works in NHS as used to collaborate with their Head of Procurement frequently on various things when I worked for MoD. To be fair, I am probably 5yrs out of date by now thinking on it more. But still most of what I wrote are basic principles that even the greenest buyer would know in terms of general process.

I can’t think of any industry that needs the quantity and variety of items the NHS uses.

I am going to suggest some of these “simple” ideas to DH later and watch him explode 😁- you can probably guess his job.

🙄

How about MoD? 😜

thats really helpful - thank you

On a really simple level (i dont work in purchasing)

Dr tells me to get paracetamol
2 options

Option 1: I get from Chemist
dr writes a script (in same appt where they tell me I need it)
Storage
people to put on shelves
People to dispense
people to pay

Cost to me either 8.99 (or whatever it is now) or free if eligible
How much does this cost the NHS?

Option 2: I get from Tesco
dr has told me to get it
storage
people to put on shelves
People to dispense Checkout 'checks' age/amount
people to pay

cost to me £0.50
How much does this cost tesco?

I think this is why people (like me) dont understand why it costs the NHS so much more than off the shelf

what about more specialised items for example, heart catheters, stents, guidewires, they are made by separate companies and different consultants have different preferences to the ones they use . Also different drugs are created by different companies some of which used for clinical trials which comes with extra funding for hospitals, how would that work?