Lack of price data hampers health service

19 November 2012

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19 November 2012 | Adam Leach

The prices paid by NHS trusts for basic medical supplies continues to vary widely, with one hospital paying 106 per cent more for blankets than the average price.

Data analysis conducted by consultancy Ernst & Young and health product comparison website Peto found the average price paid for adult warming blankets by 10 NHS trusts is £60, but one hospital paid as much £124. The authors of the study argued unless spending by trusts on everyday products is tightened up, the variance could cost the taxpayer an extra £500 million a year.

Joe Stringer, a partner at Ernst & Young, said: “Our analysis raises serious concerns about price variation and spending in the procurement of NHS supplies. At the root of this problem lies the lack of transparency in the market, leaving trusts unable to make cost-efficient decisions about purchasing supplies.”

In response to the findings, health minister Lord Howe said such a waste of taxpayer money is “unacceptable”. He said when implemented, a new bar coding system would provide the transparency and price data required to bring spending into line. “The new system will take time, but ultimately it will result in the kind of price comparison website that already exists in other sectors, like supermarkets, and will revolutionise the tracking, safety and use of clinical products bought by the NHS," he said in a statement.

The analysis identified a significant variance between what the 10 trusts surveyed spend on everyday supplies. The average cost of forceps was found to be £21, with the highest price paid being £23. The smallest variance was for pin drill tips, with the difference between the average and highest prices just £1. The study examined the prices of nine different supplies, including syringe pumps, stents and laparoscopic shears.

In February 2011, the National Audit Office concluded that £4.6 billion spent annually by the NHS on everyday supplies represented “poor value for money”. The NAO also claimed that annual savings of £500 million could be made by bringing spending under tighter control.

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