Post on 30-Mar-2018
Procurement Transformation Programme
The Future Operating Model
September 2017 DH – Leading the nation’s health and care
Procurement Transformation Programme and the Innovators’ Journey
19 Sep 2017
Partners
Procurement Transformation Programme
The Future Operating Model
September 2017 DH – Leading the nation’s health and care
We support the NHS to find digital solutionsto solve problems relating to the delivery of care
We build the capability of innovatorsto navigate the NHS and innovation pathway, in order to gain market access
We build London’s digital health ecosystemto speed up the adoption and commission of digital innovations
We build the capability of health and care staffto support and lead digital health enabled transformation in the NHS
Procurement Transformation Programme
The Future Operating Model
September 2017 DH – Leading the nation’s health and care
Support for Industry:
ü Masterclasses
ü 1-1 Innovation Clinics
ü Pitching support
ü Resources and opportunities
ü Notice of funding, news and events from across London
ü Bespoke consulting services
Procurement Transformation Programme
The Future Operating Model
September 2017 DH – Leading the nation’s health and care
09.30– 10.00 Refreshments®istration
10.00– 10.05 WelcomefromDigitalHealth.London Yinka Makinde,ProgrammeDirector
10.05– 10.10 WelcomefromCocoonNetworks Yating Yuan,MarketingManager
10.10– 10.45 IntroductiontotheProcurementTransformationProgramme
(20minutepresentation+15minsQ&A)
MariellaChilde,SupplierRelationshipandEngagementManager–DepartmentofHealth
10.45– 11.20 TheInnovatorsJourney&theNHS
(20minutepresentation+15minuteQ&A)
ChristopherSchonewaldCommercialPolicyAdviser–DepartmentofHealth
11.20– 11.30 Round-upandfeedback MattRigby, ProjectManagerDigitalHealth.London
11.30– 12.30 Networkingand1-1s
Today’s agenda
Procurement Transformation Programme
The Future Operating Model
September 2017 DH – Leading the nation’s health and care
14 DH – Leading the nation’s health and care
The Big Picture
1955-6 Health (11.2%)
Other publicservices budget
2015-6 Health (29.7%)
Other publicServicesbudget
• NHS spending rising as percentage of public spend
• Aging population and increasing healthcare costs fuelling increase• Significant public/media/political concern over ‘spiralling’ NHS
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£5.7bn spend across the NHS on goods in 4 key areas:
- Everyday Hospital Consumables - Common Goods- High Value Healthcare Consumables - Capital Equipment
DH – Leading the nation’s health and care
Context – Macro Numbers
Goods £5.7 BNon
Influence£8.2 BPharma
£6.0 B
Goods & Services
£9.0 B
Only £2.2bn goes through NHS Supply Chain today (£1.5bn goods
and £0.7bn capital equipment)
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The Current NHS Procurement Landscape
40%40%
20%
Hubs (7)NHS Supply ChainTrust Procurement Teams (200+)
DH – Leading the nation’s health and care
• Complex, fragmented landscape with “internal” competition for the range of products
• Widespread duplication of effort with procurement expertise spread across the system
• Disaggregation of demand
• 7,000 of 320,000+ (2%) SKUs represent 80% of total supply chain consumables spend (£1.2bn)*
*All figures valid for the last 12 months*Total consumables spend £1.5bn
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T O
D A
YT
O M
O R
R O
W
20% 40% 40%
10% 85% 5%
NHS Supply Chain
Future Operating Model – Category Towers
Trust Procurement Teams
PublicHub
PublicHub
PublicHub
PrivateHub
PublicHub
PrivateHub
PublicHub
CT 5
CT 11
CT 7CT 8
CT 9
CT10CT 6
CT 2
*Indicative breakdown following procurement exercisesTrust Procurement Teams
G G G
GG
CT 1CT 3
CT 4G
G
G
G
G
G
G
C1C2
C3C4C5 C6C7
C8C9
C10C11 GC1
C2C3
C4C5
C6 C7 C8C9C10
C1C2C3
C4C5
C6 C7 C8C9C10
GC1C2
C3
C5 C6 C7C8C9
C1
C3C4
C5C6 C7 C8
C9C10
C2C3
C4C6 C7
C8C9
C1
C10 C3C4
C5C6 C7
C8
C10C2 GC1
C2C3
C4C5
C6 C7 C8C9C10
GC1C2C3
C4C5
C6 C7 C8C9C10
GC1C2
C3
C5 C6 C7C8C9
GC1
C2
C3
C4C5 C6
C7
C8
C9
C11C10
GC1
C2
C3
C4C5 C6
C7
C8
C9
C11C10
Current and future landscape
Hubs not involved in Category Towers
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This model envisages disaggregating the service into 5 functional components:
The body that contract manages the delivery of functions and
manages the governance and customer boards. It will have
~200 staff
It also undertakes the customer service and relationship
management function, ensuring that customers have a clear
route of communication into a more disaggregated landscape.
One organisation is currently in charge of the procurement / category management of all
items. We envisage a new model where separate specialist
organisations focus on mutually exclusive category groupings.
All of these functions require integrated IT platforms in order to work seamlessly.
A similar concept to the service provided today, with
a greater focus on continuous improvements.
This is all seamless from a client perspective, with items purchased through a NHS Catalogue
IntelligentClientCoordinator
LogisticsProvider
ProcurementCategoryTowers
SupportingTechnologyInfrastructure
TransactionalServices
One organisation providing accounts payable, accounts
receivable and management of invoice queries.
Ensures the delivery of consolidated invoicing to users
Future Operating Model
DH – Leading the nation’s health and care
19 DH – Leading the nation’s health and care
Category Tower Composition
Non Medical
Tower 11NHS Hotel Services
Tower 4Orthopaedics,
Trauma & Spine, Ophthalmology
Medical
Tower 3Infection Control And Wound Care
Tower 5Rehabilitation,
Disable Services, Women’s Health
& Associated Consumables
Tower 2Sterile
Intervention Equipment And
Associated Consumables
Tower 10Food
Tower 9Office Environment
Capital
Tower 7Large Diagnostic Capital Devices incl. Mobile & Consumables
Tower 8Diagnostic
Equipment and Associated
Consumables
Tower 1Ward Based
Consumables
Tower 6Cardio-Vascular,
Radiology, Audiology & Pain
Management
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Opportunities for Suppliers
• Reduced sales and marketing costs.
• Clinical expertise will be embedded into the towers.
• There is a clear route for innovation.
• Commitment deals will make it easier for suppliers to plan their business and outputs, and to reduce internal costs. This also means more certainty and predictable cash flow.
• Category Tower managers will be incentivised on reducing total cost in the system, not on reducing unit cost.
• Reduced burden of participating in procurement exercises, as the number of buyers is reduced.
DH – Leading the nation’s health and care
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Why might suppliers feel threatened?
• Entry points into the system will be reduced, reducing opportunities for targeting sales into Trusts.
• Product lines will be rationalised, resulting in some products being de-listed.
• Commitment deals mean that continuous opportunities to win business will be reduced.
• Clinical expertise embedded in towers may be focussed differently from a supplier’s USP. Suppliers may need to reconsider product specifications to meet the NHS specification.
DH – Leading the nation’s health and care
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Clinical Evaluation Team
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Their reports so far can be read at: http://www.nhsbsa.nhs.uk/CommercialServices/5651.aspx
The full work plan is available at: http://www.nhsbsa.nhs.uk/Documents/CommercialServices/CET_work_plan_2016_-_2018_(V1)_12.2016.pdf
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2016 2017 2018
Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4OCT
NOV
DEC
JAN
FEB
MAR
APR
MAY
JUN
JUL
AUG
SEP
OCT
NOV
DEC
JAN
FEB
MAR
APR
MAY
JUN
JUL
AUG
SEP
OCT
NOV
DEC
DH – Leading the nation’s health and care
Category Tower Timelines
Cat Towers #1Medical
Cat Towers #2Capital & Non
Medical
Contract AwardGo-Live
OJEU
Office Supplies CCS
Selection PhaseInvitation To Tender
Evaluation & Approvals
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2016 2017 2018
Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4OCT
NOV
DEC
JAN
FEB
MAR
APR
MAY
JUN
JUL
AUG
SEP
OCT
NOV
DEC
JAN
FEB
MAR
APR
MAY
JUN
JUL
AUG
SEP
OCT
NOV
DEC
DH – Leading the nation’s health and care
Other Workstreams
Supporting Technology
Transactional Services
Logistics
Contract Award
Go-Live
OJEU
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Contact:
Paul Webster:paul.webster@dh.gsi.gov.uk0207 972 2314
Laurence Hodgson:laurence.hodgson@dh.gsi.gov.uk0207 972 1247
DH – Leading the nation’s health and care
The Innovators Journey
Procurement and the NHS
September 2017 DH – Leading the nation’s health and care
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Invention Evaluation Adoption
DH – Leading the nation’s health and care
Introduction
• Health System has complex innovation landscape.• Three stage process, with different bodies addressing different parts of
the process:
• DH Commercial Directorate’s focus has been on transition from evaluation to adoption.
• Today I want to talk to you about the common form of meetings we have with suppliers…
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• Are you addressing a particular condition e.g. diabetes?
• Which part of the health system are you addressing?
• How are you addressing the problem e.g. new technology or software?
DH – Leading the nation’s health and care
Question 1 – What is the problem you are trying to solve?
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Question 2 – How big is the problem?
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How many patients are being affected by the
problem?
£How much waste of
resource or money is occurring?
?Are there other problems e.g.
employee safety?
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Question 3 – What is the current solution we are using?Question 4 – Why is your solution better and innovative?
DH – Leading the nation’s health and care
• What is the solution currently in use:• What is the patient experience of this including safety record and side effects? • What are the connected costs – in buying the solution and other effects (less
time in hospital)?
Create a detailed comparison of your solution vs. the status quo
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Patient Benefits
DH – Leading the nation’s health and care
Clinical• Direct patient benefits• Less side effects• Lower recovery time • Lower risk of infection
Non-Clinical• Outpatient procedure• Less time in hospital• Follow-up by phone or at GP
Surgery
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Economic Benefits
DH – Leading the nation’s health and care
Clinical• Cost of the product• Cost of consumables• Faster – uses less of a
clinicians time• Lower risk of infection/side
effects – lower costs on future treatment
Non-Clinical• Less time in hospital/no
overnight stay• Follow-up by phone or at GP
Surgery saves time/cost
Can these benefits be easily articulated and shown?Do you have a Medtech Innovation Briefing (MIB) for the technology?
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Question 5 – Who are you working with and who agrees with you?
DH – Leading the nation’s health and care
The following individuals will give weight to your product:
• Clinical advocates• NHS Trust Administrators • NHS Trusts• Institutes or Royal Colleges• Academic Centres e.g. Universities.• Academic Health Science Networks (AHSNs)
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Question 6 – Do you have all the necessary accreditation?
DH – Leading the nation’s health and care
Check relevant NICE guidance to make sure your product has the right accreditation, examples include:
1. CE demarcation;2. If it’s digital – do you understand the cyber security requirements;3. Are your ISOs all in order; and4. Have you spoken to NICE and MHRA.
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Question 7 – Are you connected into the right places?
DH – Leading the nation’s health and care
• National Institute for Health Research (NIHR) (Biomedical Research Centres (BRCs) and others)
Invention
• NIHR (BRCs and Diagnostics Evidence Co-operatives (DECs))
• Academic Health Science Networks (AHSNs)• National Institute for Health and Care Excellence
(NICE) – publish guidance for products.
Evaluation
• NIHR – DECs and Collaborations for Leadership in Applied Health Research and Care
• NHS England – Innovation Technology Tariff• AHSNs
Adoption
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Question 8 – What are your specific challenges?
• If you have answered questions 1-7 then try and identify your unique issue.
• This will potentially be a technical point to do with:• pricing;• procurement; or• prescription.
DH – Leading the nation’s health and care
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Next Steps
DH – Leading the nation’s health and care
• Digital technology – check G-Cloud;• Talk to the Department of Health and NHS England;• The Future Operating Model.
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Some of organisations involved in innovation
DH – Leading the nation’s health and care
• NHS England• NHS Innovation• National Institute for Health Research (NIHR)• National Institute for Health and Care Excellence (NICE)• Medical Research Council (MRC)• Department of Health
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Contact:
Joel Glover – Head of Growth and Market StrategyJoel.Glover@dh.gsi.gov.uk
Robert Oldham – Commercial Policy LeadRobert.Oldham@dh.gsi.gov.uk
DH – Leading the nation’s health and care
Procurement Transformation Programme
The Future Operating Model
September 2017 DH – Leading the nation’s health and care
Upcoming Masterclasses:
ü Interoperability and APIs
ü Digital health safety
ü Getting accelerator ready
ü The GDPR
ü Getting onto the NHS Apps Library
ü Pitching skills
What else would you like to see?...