Interview with Jin Sahota, chief executive of the new NHS Supply Chain on how government procurement reforms are unlocking millions for the NHS
Jin Sahota is the government procurement expert in charge of unlocking billions for the NHS frontline at a time of record demand. He reflects on three years of trying to get hospital procurement teams to work together and the challenge of maintaining supplies amid Brexit uncertainty.
Jin joined the Department of Health as director of supply chain in March 2016 with a key focus on raising commercial standards and capability whilst establishing a positive challenging working environment in the DH Commercial Division.
He joined at an auspicious time - not only was the government commercial function up and running, but just the previous month, Lord Carter had published his report for the Department of Health examining the cost of variation in procurement and practices across the health service. The review concluded that as much as £5bn a year could be saved by 2020-21 through following a “model hospital” plan. After this report, DH’s procurement transformation programme - led by Sahota - was set the £2.4bn savings goal by 2020-21 as it developed the new model for buying across the NHS.
Medical supplies and equipment are bought across the health service in three ways. Hospitals can buy their own products, they can group together to buy collectively, or make use of the NHS’s own central buying agency. At the time Sahota around 40% of the purchases in the NHS trusts were going through the then-outsourced buying agency, NHS Supply Chain. He identified increasing this share as an immediate priority.
Sahota is head of the government-owned NHS Supply Chain Co-ordination Ltd (SCCL) procurement body and he has freed up millions for the NHS frontline since joining government in March 2016. Sahota and his team in the health department worked to change this through what they called the future operating model for buying. NHS Supply Chain was brought back in house, to be led, while the views of 80 trusts were canvassed to find out what would encourage hospitals to use the organisation.
One key request was for transparent pricing. Previously anything sold through NHS Supply Chain had a margin added to it, to meet the organisation’s costs. But “what the trust really wanted was price transparency”, he says. “They wanted to know that if we bought it for £1, we were selling it at £1, as opposed to buying it for £1 and selling it for £1.10. They wanted to go away from a margin model towards a centrally-funded model, which is what we’ve been able to put in place.”
The group also worked to reduce the number of different products being purchased across the NHS in England, after a sample of 22 trusts revealed that in one year they used 30,000 suppliers, 20,000 different product brands and more than 7,000 people were able to place orders. “There was confusion as to what is the right product.” However, just like procurement reforms in government, Jin could only persuade, not compel, buying teams to change, and he realised the way to get hospitals on board was through clinical reviews. A clinical evaluation team of NHS lead nurses was established to do this and - crucially - was not told the prices of products. This meant the team could convince hospitals to streamline their inventory with arguments on quality not price, says Sahota. They produced 32 clinical reviews covering 69 product types.
All this work has led to early progress. SCCL has only been back in the Department of Health and Social Care for 10 months, but Sahota has already overseen an increase in the amount spent through it from 40% to 51% of all NHS purchases. Overall, the programme has saved a cumulative £344m so far, and “we are on the trajectory to deliver the £2.4bn”, he says.
Such a shift is “not because we waved a magic wand it’s because of the focus that we put on engaging with trusts”, Sahota says. “Instead of saying, ‘we’re here and if you want to buy something, come and buy something’, we’ve got bespoke account plans for each of the trusts, we’re building up pictures of what can be done, and we’re helping them switch products - which we know is not easily done.”
The NHS Long Term Plan set a target for greater use of SCCL, seeking to get its share of NHS purchases up to 80% by 2022. “What I hear more often [from trusts] is: can you stop giving us a choice and just dictate the thing, because then we wouldn’t have this other 50% still being done in a different way”. Although that day might come - “when you get about 80% of the market share, what’s the point of doing something different?” - unlocking those cash savings remains his immediate priority.
“In 2021, we will be delivering £600m cash-releasing savings per year. That’s £50m in cash-releasing savings per month that go to frontline services. It doesn’t come back to me, it doesn’t go back to the department, or even government. It goes back to the NHS, to frontline services where it belongs. That’s phenomenal. We are on that trajectory, and it’s great to be part of it.”
This is not to say it has all been plain sailing. Sahota has had five different ministers overseeing the plan since he joined government, and the programme has also been buffeted by a snap election and Brexit planning. Although he calls government “the best place I’ve worked for a very long time”, Sahota has also had to adjust to life in the civil service. “When I joined from the private sector, somebody said it will take six months for an approval,” he says, smiling. “I laughed, thinking that would never be the case. But I’ve learned to really understand why things happen in a certain way and never to think it is for no reason.”
Sahota says SCCL has “deferred some parts of our development that were non-critical, the nice-to-haves” to free up time to focus on ensuring supply of medical devices and clinical consumables after EU exit.
The organisation is well prepared “with the known variables that we have in front of us”. Having developed contingency plans, Sahota is now working to ensure they can be activated as needed. “We’re working with all our suppliers and ensuring that there are levels of preparedness on their side,” he says, adding that: “We’re in a better position than we could be if we hadn’t started on those plans some time ago,” he says.
Leaving the EU only adds complexity to already tangled web of different players across both government and NHS that Sahota has to work with. “It is a challenge and it’s one of the reasons why I came in, but it’s not insurmountable,” he says. “It’s not difficult in terms of complexity, it’s just complex. You need to respect it as a complex thing but then deal with it in your own way - and make sure that you don’t allow the complexity to win.”