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Value Based Procurement – A game of chance?

Brian Mangan • October 13, 2024

One of the most popular games of chance in the world is the lottery, we have the Euro Millions, Mega Millions in the US and a whole range of national lotteries and Lottos…there are vast numbers of people who play this in the hope that they will win the big prize and it will change their life forever.


Healthcare can also be a lottery, but instead of needing to pick the right six numbers in sequence, you need to have the right letters and numbers in your postal code to become a winner in the game of healthcare provision. As the CEO of Luach Consulting Group and Board Member for the European Association of Value Based Healthcare (EAVBHC), I have view that quality and affordable healthcare shouldn’t be a game of chance, but that it’s the right of all citizens.


The belief is that the adoption of value based healthcare is key to addressing these inequalities and was a question posed to a group of multidisciplinary stakeholders from around the world at the EAVBHC session I led at the ICHOM Conference in Barcelona in 2023.


In this short article consideration is given to how to increase the chances of winning on the VBHC lottery, by focusing on the ‘what’, the ‘how’ and the ‘when’ to implement a value based approach to healthcare.


The What


Value is a homonym. A word that can and does mean different things to different people.


In the context of value based healthcare there is an agreed definition that value means improved patient outcomes at lower cost. However there remain a number of challenges with this i.e.


  • How do we define and outcome, what tangible benefits are being delivered?
  • Who is responsible for defining the outcome – the healthcare professional or the patient?
  • How to we know the outcome has been achieved, what measures do we need to use?


Opinions from the assembled delegates at the EAVBHC session, particularly clinical colleagues, was focused very much on the fact that the patient should be at the centre of determining what an outcome should look like. However, within the group and the wider ICHOM conference the view was generally that this was easier said than done. Patients are people and we are all diverse in our views as to what we want, and therefore health systems need to create mechanisms that can accurately reflect the overall consensus of what is desired and required.


That said we are living in world of limited financial resources, whether we like it or not delivering value based healthcare at scale requires that the stated outcomes are affordable. This balance between clinical and commercial is traditionally fraught with tensions, largely down to traditional behaviours and tug of war between front line care staff (resources) and hospital administrators (finance).


In determining the “what”, patient groups, healthcare registries, ICHOM and the use of organisations such as the EAVBHC could all be a rich source of information for systems looking to specify the desired outcomes as a starting point for a value based approach.


The How


Despite the fact that VBHC has been around for many years, there is still much debate as to how it can be introduced, to increase the chances of success, I’ve recommended these three steps to help you:


1. Establish a coalition to support the change - The drivers for system change towards value are predominantly through the efforts of clinical leaders, with one colleague from Brazil in the group clearly passionate about the need for a value approach, yet frustrated at the speed and process of adoption. in South Africa they are fortunate to have system leaders, such as the COO at Healthforce, who are enlightened and can set the strategy to facilitate a more value based approach. A third level of creating momentum is through the leadership of Healthcare Commercial, (both finance and procurement), with examples being shared by both Canada and the UK.


The authors experience and assertion is that for a value based strategy to have any chance of being implemented, there needs to be a blended approach and commitment from both clinical, senior leadership and commercial stakeholders to commit resources and energy to delivering the programmes. If you can garner support from political leaders, then this will allow you to move at pace and scale.


2. Create system learning - by a developing and delivering a comprehensive education package available for both internal stakeholders (Clinical. Operations, Finance and Commercial) groups and external (Industry partners) focusing on the principles, practices and system interconnections relating to value based practices.


3. Be incremental - In the same way you wouldn’t go out and run a marathon after being on the couch for a lifetime, its about taking small steps. In this case by creating pilot studies that can be used to help test how best value can be adopted in your health system, allowing you to highlight any challenges in a controlled environment and create solutions to address them.


The When


I’m sure we’ve all experienced the challenge of the “should” when it comes to going on a diet, exercising or going back to study, the hardest part is actually starting. We plan, we strategize and put things off until finally something happens that forces us to take action.


Health systems need to recognise the burning platform for change that exists in terms of increasing demand set against a backdrop of limited financial resources; and that by failing to address health inequalities now we will only make the situation worse. Like many of the delegates and health systems attending the session and the ICHOM conference, it is clear to me that the time to take action is now.




Brian Mangan FCIPS

CEO Luach Consulting Group

www.luachcg.com

Board member European Association of Value Based Healthcare

EUROPEAN ASSOCIATION OF VALUE-BASED HEALTH CARE -Your health, your choice- (eavbhc.org)

What is value based procurement?

By Brian Mangan • September 29, 2023
Limited financial resources and an ever-greater demand on healthcare services make intelligent procurement more important than ever. Are you involved in the often-complex process of buying products and services on a business-to-business basis? Could you do it better? Probably. In this post we’ll answer the question what is value based procurement and explore the ins and outs of the process from an expert perspective. By the end of it you’ll understand the ins and outs of value based procurement in med tech and pharma. Is procurement the same thing as purchasing? Procurement is slightly different from purchasing. Procurement is a strategic approach that involves finding reliable suppliers and sourcing the right products and services. Purchasing covers the transactions and costs involved in actually buying them. There are different kinds of procurement, too. Ordinary procurement is one thing, Value Based Procurement is another. What is value based procurement? Value based procurement is a holistic approach that seeks to maximise the potential of the function by making procurement smarter, focusing on opportunities across a whole patient pathway, not just trying to save few pounds on a product. The aim is to reduce the pressure on health budgets, deliver better value, and encourage ongoing innovation. At the end of the day smart procurement helps create a more efficient procurement environment, and there are several ways to make it happen: The aim is to achieve the most economically sensible results without compromising on quality, then sharing experiences to achieve continual improvement. It’s more likely when multidisciplinary healthcare teams take outcome and value into account as well as costs Policymakers agree what value means in terms of the patient journey, encouraging collaboration between providers and suppliers, helping suppliers become active partners in improving human health, and using value to make better budget decisions Healthcare professionals work closely with procurement experts to create the best clinical outcomes, optimising care The sector as a whole supports MEAT VBP - the Most Economically Advantageous Tender Value-Based Procurement - by promoting their technologies, services and patient solutions to society as well as hospitals, authorities, and healthcare systems The benefits are clear. VBP is popular with Healthcare Systems because it can deliver tangible, measurable benefits with a positive impact on patient care, as well as boosting efficiency and making budgets go further. When done right Value Based Procurement in med tech and pharma will result in improved efficiency, released bed capacity, reduced costs, enhanced patient experience and support Health Systems with their environmental goals. And all this means an overall improvement in the positive growth and development of rugged, effective, and compassionate healthcare systems. Come to us for professional Value Based Procurement training and consultancy Put Brian Mangan Associates to of your list for healthcare Value Based Procurement training and consultancy excellence. Our expertise is born of wide academic and operational experience and deep industry insights. Years of unparalleled experience and plenty of real-world evidence makes us your number one choice for global health systems, pharma, and med tech. We’ll help you build a credible, highly effective bridge between your health system and suppliers.

Value based procurement in healthcare

By Brian Mangan • September 29, 2023
This post focuses on value based healthcare. Why? Because healthcare budgets are tight and getting ever-tighter. Because patient demand in the UK is increasing steadily thanks to an ageing population. And because the covid pandemic that hasn’t yet come to an end, nor have the associated delays in the diagnosis and treatment of all sorts of illnesses and diseases. In times like these every penny counts and every decision matters. How do you make the best of procurement, saving money while improving the patient journey every step of the way and delivering quality work, services, and products? It’s all about Value Based Procurement in Healthcare, VBP. Read on to find out how VBP can save money and improve your healthcare services. What is value based procurement in Med Tech? There’s unprecedented pressure on healthcare finances at the moment, making the medtech sector a very challenging landscape indeed. Luckily value based procurement is proving vital for getting better value across the spectrum for health systems, and ultimately for the patients they care for. Value based pricing improves patient outcomes affordably. The idea is that companies, and those who buy from them, all get genuine benefits from value based healthcare. Buyers focus on appropriate care, which means buying the right drugs, products and services, for the right patients, at the right time. This gives healthcare providers a much better chance to hit the positive outcomes that mean so much to everyone involved. Once you understand VBP and know how to manage it with confidence, the overall cost of treating patients better becomes more affordable.. How is VBP different from traditional procurement? The old approach to healthcare procurement involved driving supplier prices ever-further down. But we all know you can only go so far in that direction before low prices affect quality and supply chain resilience. A series of price slashes can even drive suppliers out of business. The Value Based Procurement approach comes with many benefits. When done well it can provide valuable efficiencies along the clinical pathway as well as cutting costs and improving patient care. A win-win, if you like. Make the most of every aspect of value based healthcare The biggest issue is how to align traditional products and solutions with the way they’re sold, so they deliver the best possible value all round. That’s what we do for people like you. Our expert consultancy and support services will help your organisation understand and define ‘value’, pin down the products that align with those needs, communicate the solutions clearly, and make them happen in the real world. Can we help you with value based procurement in Med Tech? We work closely with experts in UK and international healthcare to provide essential insight into the theory, practice and simulation of value based healthcare. To achieve this, we’ve created a unique modular value based procurement in pharma training and consultancy programme for organisations wanting to build or develop value solutions. As our clients tell us, it’s a great way to achieve the right kind of organisational change with tangible results and real benefits.

A voyage of value based procurement discovery – Arab Health 2023

January 26, 2023
Value based procurement in the NHS is more crucial than ever right now. We need to know about most efficient technologies, treatments, and new developments so we can help you achieve real value based procurement in healthcare. That’s why we’ll be attending the Arab Health event in Dubai at the end of January.

VBP essentials - Measuring value based procurement

December 19, 2022
It’s one thing deciding you’re going to support, lead, and bring about value based procurement in your organisation. It’s another thing finding proof that the work you’ve done has indeed resulted in VBP in practice.

What do Value Based Tender responses look like?

December 8, 2022
What really represents ‘value’ in tendering? Real world evidence generation in pharma, value based tender responses and value based healthcare go hand in hand. In fact, the law demands it thanks to the Public Contract Regulations (PCR), which ask the public sector to award tenders based on the ‘Most Economically Advantageous Tender’. The Act obliges people in our sector to put emphasis on value questions in tenders and Pre-Qualification Questionnaires or PQQs, neatly demonstrating the importance of linking value and tendering.

How do suppliers achieve value in procurement?

November 28, 2022
In a world where healthcare budgets have been under pressure for many years, how do suppliers achieve value in procurement? It can be tricky when value based healthcare isn’t about achieving the lowest price, it’s more about finding the optimum combination of cost and quality.

Learn to improve value with a Value Based Procurement workshop

November 17, 2022
These are tough times for compassionate people in healthcare procurement. Like most of us working in healthcare, you probably joined the service because you care. But the increasing demand for resources we’re seeing, set against a backdrop of limited financial resources, will probably be having an impact.

Our popular Value Based Procurement workshop

November 3, 2022
It’s your mission to achieve value proposition development for med tech. It’s a worthy goal in a world where every penny in the budget matters. Successful value proposition development in pharma involves knowledge. How do you gain the insight you need for building effective value propositions in med tech? Education is the word.

About value based procurement training

October 20, 2022
Increasing demand, covid, budget cuts and more mean our healthcare systems are under pressure to deliver excellent results at a lower cost. Standardisation, aggregation, and competitive bidding have done a good job of releasing funds for front line care. But there’s a line below which costs can’t drop without affecting the quality of products and their supply chains. Value based healthcare in pharma is the way ahead, and it presents an exciting challenge. Here’s what you need to know about value based procurement training from BMA.

Value based procurement in the NHS

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So you want to know all about value based healthcare in med tech? Read on to discover everything you need to know about value based healthcare in med tech. By the end of this post you’ll know what it is, why it matters, and how to achieve it in your own healthcare procurement context. This is your guide to value based procurement in the NHS.
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