Six NHS trusts have worked together to reduce their combined agency staff bill by £4.5m.
They have done this by instituting an “open book” approach to sharing information about agency costs, holding regular meetings of managers from different departments across the partnership and by running joint tenders for agency contracts.
They started collaborating in October 2015 in response to the introduction of caps on the amount trusts were allowed to spend on agency staff, brought in across England by the Department of Health (DoH).
“It [the caps] helped to focus minds more broadly, so from a procurement point of view we found it helpful and supportive,” said Jim Forsyth, head of procurement at Hertfordshire NHS Procurement, the service that delivers for four of the trusts. The caps also helped to secure buy-in from top-level management across all the trusts, he said.
Jane Goodall, purchasing manager at Hertfordshire NHS Procurement, said: “If we were actually going to [meet the caps] we needed to share intelligence and we needed to know what the market rate was.”
Beyond the open book policy, the trusts worked to develop personal relationships within the partnership between corresponding managers in different trusts, Goodall said. “The temporary staffing managers are meeting and talking, the theatre managers are meeting and talking, and building a network so we can help understand fact and fiction,” she said.
“So when we’re being told by an agency or a locum or a worker that they can get higher rates in a neighbouring trust, we were able – through the relationships that we’ve built – to contact that individual and say, ‘Is that true or not?’”
With NHS trusts across England struggling with budget deficits, DoH introduced caps on agency fees across England in October 2015 to try and stem the rising cost of temporary workers. Trusts that fail to meet the spending caps must report on why they overspent.
Four of the trusts, based in Hertfordshire, had already been collaborating together through Hertfordshire NHS Procurement. These are East and North Hertfordshire NHS Trust, West Hertfordshire Hospitals NHS Trust (WHHT), Hertfordshire Community Trust and Hertfordshire Partnership University Foundation Trust.
Luton and Dunstable University Hospital Foundation Trust and Bedford Hospital NHS Trust, which are not part of Hertfordshire NHS Procurement, then started to collaborate with the trusts on agency fees and tenders.
As NHS organisations have a habit of working silos, they had been known to bid against each other, said Paul da Gama, director of human resources at WHHT. “You’ve got a limited number of nurses and doctors, you’ve got a whole bunch of organisations.”
Now, by combining their buying power, the various trusts can incentivise agencies with the promise of more stable work. Departments are encouraged to offer work to tier one suppliers, which offer the lowest competitive price, in the first instance.
Suppliers can benefit from this arrangement, said Forsyth. “If they can see that there’s discipline, the togetherness, the consistency throughout these six trusts means that we can deliver volumes to the preferred suppliers. So if you are in that top tier, you know you’re going to get business,” he said.
“That’s not always been the case, and it’s not always the case everywhere.”
Reducing the cost of agency staff is just one part of a wider goal to find the perfect balance between agency and in-house staff. Now when managers from the different trusts meet, said Goodall, they talk about wider issues including joint recruitment exercises.
Reducing the price of agency staff is already contributing to more in-house vacancies being filled, she added.
Working with a procurement team “who really understood both the market, and what we were trying to do” is incredibly important to the success of the collaboration, said Da Gama. “I can’t begin to praise enough the input of procurement into this exercises. I think without them what you would have had is lots of good intentions that would have been difficult to build.”
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