What part can healthcare procurement and supply chain play in supporting global issues such as health equity and environmental sustainability? Karen Conway spoke with Jack Searle from HSJ Intelligence to share insights from her experience of the US health system and how these can also apply to the NHS and its suppliers.
HSJi Review: Exclusive insights from healthcare supply chain expert Karen Conway
Health Care Supply Association hosted its annual conference in Harrogate at the end of November. Before the event, I sat down with one of the keynote speakers, healthcare supply chain expert Karen Conway, who had jetted over from the US specially to address the NHS procurement professionals’ annual do. Ms Conway has been vice president for healthcare value at Global Healthcare Exchange, a US healthcare supply chain software and service supplier, for nearly 20 years.
Our wide-ranging discussion, drawing on her experience of the US health system, touched on several points that are important for the NHS and its suppliers. I have not the space to relate the full extent of the conversation but here are some choice highlights.
“If you start looking at all the problems facing healthcare and the delivery of healthcare, it can be overwhelming,” Ms Conway said. “How do we address the shortages in the supply of staff? How do we take care of disadvantaged populations? How do we address climate change, et cetera?
“But if you actually start to look at how they overlap, you can come up with initiatives that address the economic, the environmental and the equity issues.”
One example from the US - specifically, Chicago - reflected what NHS providers are trying to do in setting themselves up as anchor institutions.
Ms Conway explained health providers had long recognised the need to address the social determinants of health, especially “on the west side of Chicago… where a lot of the disadvantaged, lower income folks live; more communities of colour”.
A few years ago, one of the city’s major healthcare systems put out a tender for a new supplies and consumables distributor, which contained a line asking suppliers to “include what you can do to help us in these disadvantaged neighbourhoods” around the healthcare provider, Ms Conway continued.
A company bid for the contract, offering to build a new distribution facility in Chicago. The health system accepted the bid on the condition the supplier built it in a certain neighbourhood where they trained and hired people too.
Back in the UK, trusts and health systems are increasingly aware of their importance in their local communities, and the opportunities this presents. Chesterfield Royal Hospital Foundation Trust has developed an “anchor chapter” with its local authority, university, and Rolls Royce, another major employer on the patch. They are specifically looking at improving local employment prospects.
University Hospitals Coventry and Warwickshire Trust also wants to use its significance as a local employer to make improvements on its patch, and Barts Health Trust has been trying to use local suppliers where possible to support its east London neighbourhoods.
Meanwhile, Bradford Teaching Hospitals FT is building a new hospital to replace the Royal Infirmary and is planning to include more community and voluntary sector space in the new build to make it an anchor institution for the city.
While there is a sense some organisations are paying lip-service to the anchor institution concept, this could change in 2022-23 when some new procurement rules come in.
From April 2022, NHS organisations must include a 10 per cent social value weighting in tenders. This will oblige suppliers and buyers to think more deeply about the issue and presents an opportunity for suppliers to work with NHS procurement teams to deliver greater value that goes beyond just cost.
Clinically integrated supply chain
Healthcare supply chain circles have a term which encompasses this: clinically integrated supply chain. It means “clinical, operational, financial, and supply chain coming together, looking at the data from different perspectives, and then making decisions based on the overall objectives,” Ms Conway said.
This is the reverse of how things used to go, she explained. “Usually, it would start with a doctor saying, ‘I want to use this pen’. And then everybody would look for the evidence about how the pen performs and how much it costs compared to the pencil we're typically using. This flips it around and you start with ‘what's the objective?’”
Suppliers, buyers and users working together can have benefits beyond clinical outcomes. There would be scope to demonstrate corollary benefits around, for example, cutting energy and water consumption, and waste production, by cutting patients’ time in hospital.
Under NHS England guidance, trusts must have a green plan by mid-January and integrated care systems must have one by the end of March.
Some trusts have been focussing on this for some time. In 2019, North Bristol Trust was among the first providers to declare a climate emergency. It intends to be carbon neutral by 2030 and has already produced its carbon reduction plan. Its early focus has been on reducing the use of high-emission anaesthetic gases, cutting car journeys and increasing the use of locally sourced foods.
Other trusts are targeting transport as means to cut emissions, such as Hull University Teaching Hospitals Trust. Meanwhile, the Cornish ICS is installing LED lighting across its estate as well as developing a system-wide heat decarbonisation plan.
But there is a concern trust and system green plans will pick the low-hanging fruit. Providers and commissioners are under intense pressure across the board, and may end up looking for quick wins.
Here again is an opportunity for suppliers to support and work with buyers by providing sufficiently detailed evidence that shows these additional social and environmental benefits, beyond the financial and clinical.