Healthcare Analytics – BravoSolution Identifies Opportunities and Worrying Trends

At the recent BravoSolution Connect event, we had a very stimulating (if somewhat worrying) session looking at spend analytics in the UK National Health Service, particularly for the hospital sector. Dave Coley, CPO at the Heart of England Trust, one of the largest hospital groups in the country, introduced the session with a succinct and informed perspective on the challenges facing the sector.

The issues won’t come as a surprise to anyone who takes an interest in health matters; increasing demand, income pretty flat, need for innovation, confused governance structure (Monitor, CQC etc.) and so on. Scott Pryde, who runs the UK Healthcare business within BravoSolution, then talked about the strength of the sort of analytics the firm is providing, with the power of the data coming from the fact that Bravo covers a reasonable proportion of the total hospital market in terms of spend data (although competitors such as Cloudbuy and Wax Digital have non-trivial market share too).

When you put the spend data together with the information that is now available around clinical outcomes, you start to see some really powerful and interesting material emerging. Without naming names, Bravo showed that the same medical item costs from £600 to £2000 across different suppliers, and that even the same supplier is charging vastly different prices from different Trusts for the same item. Interestingly the prices achieved are “not volume related” according to the analysis – the big buyers don’t necessarily do better. But the next stage, when clinical outcomes come into play, is even more interesting.

Here, we can see that the most expensive product is not necessarily the best in its category in terms of its medical effectiveness. So often, we see a hospital that is on the wrong end of a double whammy - first of all paying more than it should for a particular item, and then also is choosing that item when there are both cheaper and more medically effective alternatives available! And indeed, there seems to be little or no correlation between the price of an item and its clinical effectiveness.

There are also some scary trends. The data suggests that matters aren’t improving – hospitals are buying a greater variety of products and amazingly, prices are going up whilst quality is going down in some product areas - the less good, more expensive products are growing market share! Which does beg the question – why on earth is anyone buying some of these products? Well, some of it is probably just inertia and history. A clinician may feel more comfortable working with a certain product, even if it isn’t “the best.” He or she may not want to re-train to use a different product. And of course, we can’t rule out corruption. It doesn’t have to be overt, or directly financial, but the invites to nice conferences, golf days and the opera do play their part in the medical firms marketing strategies.

Procurement professionals in the sector therefore have a real opportunity to link value, and potentially real cost savings, with these wider issues of safety, outcomes and quality. This takes people in the function who are comfortable working and communicating well with surgeons and senior hospital managers. It’s not always an easy task getting the message across and achieving movement here. But at least the sort of data that is now available, on price benchmarking, variances, and clinical outcomes, is making those discussions easier for procurement to have and to win.

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Voices (4)

  1. Stephen Heard:

    This is not new news and this disparity has been known for years however the NHS, a loose confederation of 700 different organisations with very little national about them, are unable to do anything as the commissioners who hold the purse strings now very little about procurement. This will only get worse as Clinical Commissioning Groups (the brave new world of commissioning) know even less about procurement. Ask a NHS commissioner about a procurement framework contract or bulk licensing agreement or forward commitment and test my theory!

  2. Mark Lainchbury:

    20% may well be the figure at your Trust (and it seems a shame your P.D. is unwilling to act on that) but please do not extrapolate this across the whole NHS.

  3. PublicProcurement:

    Not sure if Bravo were the first (there’s many in the market with much larger datasets/analysis capability). These facts have been known by the NHS for years! Until there’s one buyer differential pricing will prevail. There’s almost too many companies out there now offering this type of service/analysis. The question is what is the NHS going to do to action this information as opposed to analysis paralysis. Hopefully Rob Knott and the team can do something nationally to support the market management side

  4. Bill Atthetill:

    What is shocking is that it’s taken a firm like Bravo to demonstrate the blindingly obvious to the NHS.

    I spoke to my Procurement Director yesterday and he said “Procurement teams across the NHS are shopping for the same products from the same suppliers for the same clinicians to deliver the same outcomes but for wildly different prices. The waste in the supply chain in quite breath-taking and I believe 20% of what we buy in clinical supplies is thrown away.” Apparently, the NHS spends £5bn a year on clinical supplies? Do the maths Peter….

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