More of the Perils of Competitive Tendering

A race to the bottom in price with little regard for quality and safety

In my last post I described how the competitive tendering process carried out by the East of England Strategic Projects Team wasted huge amounts of the time of many doctors, managers and scientists in meetings which were billed as consultations but with no notice being taken of comments. The objective was to reduce the cost of Pathology to GPs and that could have been achieved through local co-operation. Instead the Projects Team came up with plans that would involve a 90 mile journey to a lab working with Serco for routine samples and inadequate provision for contacting GPs with seriously abnormal results requiring urgent action.

The plans were so poor there was an immediate outcry. One Clinical Commissioning Group invited the preferred providers to attend a meeting to discuss logistics and were amazed to find the logistics team got lost and were over an hour late before trying to present themselves as  capable of running a collection and delivery service.

Local GPs were quick to highlight the problem in the local paper – Southend and Basildon Echo made it a cause célèbre and the CCGs – in the best spirit of the NHS -negotiated a deal with the Hospitals. Although the East of England Strategic Projects Team have gone quiet, lessons must be learnt from such poor planning and the local Area Team manager made the following comments – the lessons are clear ;

  • There needs to be a clear rationale for the change
  • Clinical views should be heard and influence well before the tender
  • The data and evidence must be as good as possible
  • The tender construct should not be too complicated
  • All risks should be fully thought through before tender
  • There should be patient engagement from the start and a visible and clear consultation process
  • Any company/hospital bidder should be fully assessed for their mobilisation competence

These principles apply to any strategic change tender

And, I would add when contracting with the private sector – ensure there are adequate monitoring arrangements with appropriate termination and penalty clauses for poor performance. This will involve solicitors and increased transaction costs and demonstrates the additional costs of marketisation.

In 2013, James Illman, writing in the HSJ commented  that three controversial regional pathology reorganisations have incurred £2m in central costs and experts estimate the total bill for NHS trusts and bidders to be about £10m and rising.

Hopefully the public and politicians in the Midlands will be able to make these points to prevent a contract being given to a provider who impresses the team with excellent sales talk but does not deliver. The lessons are clear from the examples – publicly provided means we own it and can change it, privately owned as with PFI means we pay extortionate rates but have no control

This is particularly relevant now because the same team (now Midlands and the East SHA ) are handling the bid for cancer and end of life services in the Midlands (see Clive’s article).