Mace Group

Private sector supply chain management systems are proving a powerful tool to deliver efficient outcomes across the healthcare sector, explains Dr Matthew Williams-Gray, Senior Strategic Health Consultant at Mace Group. The company has extensive experience in providing strategic healthcare consultancy and has been a pioneer in placing supply chain management at the heart of successful projects in all sectors.

One of the paradoxical challenges resulting from improving healthcare services and technology is how to deal successfully with the increasing numbers of patients managing long-term conditions, such as diabetes. For the NHS, which is constantly trying to reduce the ‘postcode lottery' effect, this will require not only closer collaboration between providers but also clinical integration between primary and secondary care, and the development of clinical networks. Indeed, evidence shows that integrated delivery systems such as the Veterans Health Administration and Kaiser Permanente can deliver really positive outcomes for people with chronic diseases.

However, in the current provider market, the emphasis is more on competition than integration, and in some cases, has led to disparate and uncoordinated services that are not conducive to integrated care. This has ultimately resulted in fragmented care pathways to the detriment of patients and other service stakeholders. The NHS Next Stage Review advocates greater support for Practice Based Commissioning (PBC) to develop integrated care for patients by encouraging multiple providers. This has yet to achieve its full potential due to the absence of organisational developmental support of PBC and the complex procurement processes, which act as a disincentive to small businesses and third sector providers.

The Supply Chain Model
So what is the alternative? Well, just as the private sector has acknowledged, successful business partnerships between public sector organisations require long term, trusting relationships, effective commissioning requires a collaborative effort between commissioners and providers. Taking these lessons on board, Mace Group's health team has developed a primary care supply chain model (see figure 1, below) that brings best practice from its private sector experience to deliver world class standards of integrated care for the public sector, whilst successfully addressing the issues of integration and collaboration that we see today.

[Figure 1: The supply chain model]

In the context of primary care, working as a supply chain means service delivery players foster positive relationships, which directly benefit the patient. Ongoing relationships make all those involved in the supply chain more responsive to clinical needs and more able to supply exactly the right product required. Most importantly, the adoption of Mace's supply chain model allows its members to integrate more comfortably, whilst preserving the important element of competition. Typically the supply chain model will comprise:

• managed practitioner networks
• horizontal integration (children's trusts, care trusts)
• vertical integration of primary and secondary care services provider units, including GPs
• community foundation trusts
• social enterprises/community interest companies
• third party estates developers to deliver any potential estates solutions (where appropriate)

The establishment of the supply chain will allow primary care trusts to ensure that all its members are organisationally robust to provide a world class commissioned service i.e. PBC clusters will receive the correct support in order to fully deliver the intended benefits of PBC and providers will be able to develop suitable governance procedures. In addition, commissioners will be able to draw down from the supply chain tendered services following a mini tender competition, thereby reducing overall procurement costs.

Complex procurement processes can discourage third sector providers but by adopting a supply chain model, PCT's can ensure that the procurement process is tailored to the nature and scale of the services being secured, the speed of procurement and the diversity of provision to deliver improved care.

A key determinant of how successfully the new PCTs supply chain can demonstrate its fitness for purpose will be their ability to shape the local market through intelligent commissioning and the robust procurement of individual providers. This will require PCTs to actively develop a market that delivers a whole system model of care and appoint robust providers that can deliver the associated individual service specifications. The supply chain model facilitates this process whilst ensuring that the providers:

• Have IT systems that allow information sharing across providers
• Are publishing good practice advice within the supply chain
• Are promoting practical examples of business cases and governance models
• Are developing the correct skill mix within the supply chain
• Are maintaining the exact distribution of the services across the PCT.

The supply chain model is particularly useful at the ‘micro-commissioning' level because it empowers patients with long-term conditions to be active members of the decision making process. This is essential if the pilot scheme for personalised budgets is extended and is built on schemes such as DESMOND for diabetes, whereby the patient becomes a member of the supply chain, taking some responsibility for the delivery of their personal integrated care pathway and management of their condition.

Conclusion
As partnerships become an increasingly popular way of working between NHS bodies and independent and third sector providers, the supply chain model will ensure that there is clarity surrounding who is responsible for patients at different points on the care pathways and that agreed deliverables and receivables by each party are established. It will ensure performance measures are put into place that allow each organisation to hold the other partners to account for their contribution to the care process, supporting the fast development of supply chain relationships.

The supply chain model establishes an understanding of the capacity, capabilities and expertise of partners that is crucial in both the planning and delivery stages of integrated care. By working in this manner, commissioners have the opportunity to negotiate certain work packages on the basis of cost and time benchmarks with the supply chain's preferred providers. The informed process of selection of providers is fundamental in ensuring the correct expertise, personnel, capacity and experience is acquired to deliver the services as effectively as possible to negate any fragmentation in the patient care pathways.

[This article first appeared in the National Association of Primary Care Review]