MEAT Value-Based Procurement (VBP) initiative

Transcription

1 supported by MEAT Value-Based Procurement (VBP) initiative Interactive session with current and future pilot experimenters EVENT REPORT 26 October 2017 Brussels

2 SUMMARY Value-based procurement can ensure more economically advantageous purchasing, helping buyers to get better value for money. Rather than basing purchasing decisions on price-only, value-based procurement requires buyers to use more sophisticated approaches, rewarding quality and focusing on patient-relevant outcomes along with benefits for various health care actors. This approach is supported by a new European Directive on public procurement which encourages the use of the best price/quality ratio when awarding public contracts in order to achieve the most economically advantageous tender (MEAT). MedTech Europe, supported by BCG, has compiled procurement organizations best practices and developed a framework to guide procurement decision-making. This framework is composed of a methodology and a simple, modular Excel spreadsheet which can be easily customised for the evaluation of various medical technologies, services and solutions. Several purchasing sites have embraced this new approach to tendering and are conducting live and experimental pilots. These are real-world testing and learning sites for the use of MEAT value-based procurement. A Community of Practice has developed to support practitioners to generate and share expertise and experience. Stakeholders gathered in Brussels on 26 October 2017 to hear from participants in pilot projects with experience of using MEAT Value-based procurement. The event involves senior figures from procurement organizations, hospitals and industry. It also heard from EU officials who provided an update on the implementation of the European Directive on Public Procurement and an overview of EU-funded initiatives that support the procurement of innovative technologies and solutions. Pilot projects discussed here include: - Spain: a learning exercise using hypothetical/experimental pilot tenders for transcatheter aortic insertion (TAVI) products; and another for diapers and underpads. - France: a value-based procurement initiative that rewards suppliers for products or solution that optimizes peri-operative hypothermia management during hospitalizations and reduces costly complications. - UK: examples from the fields of audiology, anaesthesia and orthopaedics. - Finland: a pilot based on a tender for stents/angioplasty balloon catheters. The MEAT VBP methodology was generally well-received and seen as a valuable starting point for running pilots. Some challenges were identified, and certain organisational changes are needed. As expertise and experience of using MEAT Value Based Procurement grows, it is expected to become more manageable with each subsequent tender and is seen as the way forward. The meeting discussed lessons learned from these initiatives, addressed further developments for the Community of Practice, and heard of plans to advance (MEAT) value-based procurement in The group agreed to build a repository of success stories and discussed plans for awareness-building initiatives.

3 INTRODUCTION Value-based healthcare (VBHC) is a framework for pursuing better outcomes for patients and other health care actors while optimising the cost of delivering care. It represents a shift away from the traditional focus on costs (inputs), towards a new approach that emphasises return on investment (outputs). Procurement can play an important role in the shift towards value-based healthcare. Rather than choosing products based only on price, some hospitals and procurement authorities are devising more sophisticated approaches that reward quality and focus on outcomes. This is supported by new EU public procurement legislation which favours choosing the most economically advantageous tender (MEAT) when awarding public contracts in the health sector. Implementing (MEAT) value-based procurement promises to deliver more value for patients, healthcare professionals, providers, and for the health system as a whole, while also helping to foster innovation. However, in practice, it can be challenging. Selecting robust criteria for evaluating tenders is demanding and value-based procurement remains relatively new to many purchasers, decision-makers and policymakers. MEAT Value-based procurement initiative MedTech Europe, supported by BCG, compiled procurement best practices and a framework to guide (MEAT) value-based decision-making. The system includes criteria covering outcomes that matter to patients, total costs, other benefits for key stakeholders and broader impact on the society. Importance Source: Boston Consulting Group (BCG) To facilitate the implementation of this approach, a simple Excel spreadsheet has been built; this tool is easily customisable for the evaluation of medical technologies, services or solutions. Several sites have embraced this approach to tendering and are currently conducting real-world testing of the MEAT value-based procurement framework tool.

4 A Community of Practice has developed to bring together people working in this field so that they can generate and share expertise. The goal is to turn tendering best practice into common practice. Stakeholders gathered in Brussels on 26 October 2017 to discuss the state-of-play of the EU Directive on Public Procurement and to hear from participants in pilot projects with experience of using the MEAT Value-based procurement tool. The event attracted senior figures from procurement authorities, hospitals and industry. Procurement can play an important role in the shift towards value-based healthcare and most economic buying. This document summarises some of the key themes addressed during a meeting of senior procurement experts from hospitals, authorities and industry. It is designed to be shared with interested parties; and to encourage all players to engage in an ongoing dialogue and partnership about the future purchasing of medical technologies and solutions in healthcare. BACKDROP Value-based healthcare Value-based healthcare (VBHC) is an approach to achieving better healthcare outcomes and optimising the cost of care delivery to the health system. This framework was inspired by the academic work of Professor Michael Porter and others. Simply defined, value is outcomes that matter to patients divided by the cost of delivering this care. Value in procurement Healthcare procurement often focuses only on the purchase price. This fails to address the needs of other stakeholders such as patients, providers, health systems and society as a whole. It also clouds the true cost of care and does not account for the economic value of health and care. An alternative approach is to make procurement decisions based on the Most Economically-Advantageous Tender (MEAT) by use of best price/quality ratio concept. The MEAT value-based procurement framework places at its core the outcomes that matter to patients, product/service quality, and further benefits for providers, health systems and society. This approach can also help to break down organisational silos within healthcare institutions, reduce inefficiencies and spur innovation-driven investments.

5 Transposition of EU Procurement directive Awarding Quality in National laws The 2014 EU Directives on Public Procurement encourages a smarter, more holistic view of public procurement and innovation. At the time of the meeting Most EU Member States have now transposed the directives. The countries that have not yet transposed are: Austria (3 directives: 2014/23/EU, 2014/24/EU, 2014/25/EU), Luxemburg (3 directives: 2014/23/EU, 2014/24/EU, 2014/25/EU), Slovenia (one directive: 2014/23/EU), Spain (one directive: 2014/25/EU) and Bulgaria (one directive: 2014/23/EU). One of the key elements of the directive 2014/24/EU is that the MEAT may include the best price-quality ratio (BPQR). Where price is considered, procurers should use a cost-effectiveness approach or life-cycle costing, while BPQR should be assessed on the basis of criteria including qualitative, environmental and/or social aspects related to the subject of the contract. When procuring medical technologies, this allows decision-makers to consider for example: (a) quality, design and innovation (b) qualification and experience of staff (c) after-sales service and technical assistance. Procurement authorities can also set a fixed price or cost for a contract, requiring providers to complete on quality criteria only. Under the 2014 directive, EU Member States can restrict contracting authorities from using price only or cost only as the sole award criterion. Hungary, Poland, Czech Republic, Italy, Romania, Slovenia, France, Latvia and, in part, Finland, have made use of this option. Implementation varies from country to country with various exceptions incorporated into national laws. For example, in Hungary the criterion of the price or cost can only be used if quality criteria would not help in choosing the MEAT. A number of countries exclude the criterion of the price or cost for specified services such as engineering, construction and architecture; food, social and labour-intensive services; and information technology, translation and advisory services. A number of Member States allow price to be used only for a certain proportion of a contract or for tenders below a specific value. For example, Italy allows the price criterion to be used for tenders worth up to 40,000. Others specify a maximum weighting that can be given to price. In Germany, for medical devices, price cannot account for more than 60% of criteria. In an open discussion, participants welcomed the fact that many Member States had embraced the spirit of the directive and are now focusing on the MEAT. Over time, further legal changes may follow as more progressive countries begin to see positive results from their new approach.

6 European initiatives In additional to the directives, The European Commission supports a number of initiatives to professionalise public procurement and has some specific PPI initiatives (Public procurement of innovative solutions initiatives). These include Thalea II which aims to use telemedicine to improve outcomes for patients in intensive care units. The system, described as a technologically advanced cockpit, will enable earlier detection of patient deterioration, earlier intervention and ultimately better survival rates. Another initiative, STOPandGO, evaluates tenders based on quality of service in the field of sustainable technology for older people. Competitive dialogue was held with technology companies and a number of products were funded as a result, including digital care records updated in real time, digital rostering with real time updates, and a low-cost Internet of Things technology. Summary - Most EU Member States have transposed the EU Directive on Public Procurement in National Law - Many European countries now mandate quality and restrict the use of price as sole award criterion - EU initiatives are helping to support the professionalisation of public procurement of innovative solutions Pilot Project: Spain A large hospital in Barcelona has launched two experimental pilots with three products. Companies with this type of technologies were informed and could participate. In a project on transcatheter aortic valve implantation (TAVI) products, four companies participated in the learning experience, while another pilot attracted five participants in the area of diapers and underpads. The hospital liaised with companies in the pre-tender phase to determine their interest and what criteria from the MEAT VBP criteria list they considered relevant for the procurement procedure. Multidisciplinary teams from the hospital were set up for each technology included in the experiment. They held four meetings to define criteria and sub-criteria; perform a literature review to select clinical, economic and other outcomes to be selected as award criteria and to define the relative weights of each criterion. In parallel, the companies participating in the project were asked to determine the criteria and metrics for their products, using the Excel spreadsheet in the MEAT Value-based procurement tool. The criteria proposed by the companies were then compared to those devised by the hospital s multidisciplinary group, allowing a final list of criteria and relative weights to be agreed. It was noted that there was wide variation in the level of information provided by the companies, with differences in the units of measure used and in the relative weights given to these criteria. The final criteria and weighting was shared by the hospital with the companies ahead of a series of individual face-to-face meetings.

7 The project is ongoing but some important lessons have already been learned. One crucial decision taken at the outset was to establish within the hospital a core common group of administrative, biomedical and clinical experts that worked with both of the teams piloting the MEAT VBP tool. This allowed the teams to learn from one another and helped to deliver efficiencies. If the projects were expanded, there may be economies of scale in having a core group serving and connecting all these teams. It was also agreed that it is important to begin training hospital administration staff beyond the contracting department itself as early as possible. This improves buy-in, developed a value-based procurement culture and reduces the risk of problems later in the process. From the perspective of companies, the Barcelona pilots have been well received. However, engaging in the process can require considerable resources. This is particularly challenging for companies such as those in the underpad sector where 90% of their market is not direct selling to hospitals. If this experience coincides with tenders the hospital may have to abandon the MEAT process due to excessive workload on their staff. Providing evidence and justification for many of the MEAT criteria was also a challenge due to the time and expertise required, as this approach is not yet part of daily practice. It was noted that Spanish law (and legislation in some other Member States) states that SMEs should not be disadvantaged. Some participants also acknowledged differences of opinion on the weighting used by the hospital and some initial difficulties in having their point of view heard early in the process. From the hospital s point of view, the process was demanding but worthwhile. The experiment will be replicated in other clinical areas. The VBP tool, which is primarily used by the procurers rather than the suppliers, was valuable but users preferred to work in a Word document rather than the Excel spreadsheet. It was hoped that, over time, this approach could foster some genuine innovation from companies rather than being a new way to choose between existing product lines. Participating companies said the process had changed their internal workings and this would have a positive effect on future product development. When the process is more mature, it may evolve to incorporate patient voices. Pilot Project: France A leading purchasing authority, responsible for a large network of French public hospitals, is about to start a real pilot on value-based procurement to reduce peri-operative hypothermia. Research has shown that approximately 50% of patients are hypothermic after major surgery. This can lead to a range of secondary symptoms which may require complex care. The hospital group wanted to incentivise suppliers to reduce this rate to below 30%. The approach rewards better outcomes. At the heart of this approach is a change in mindset. Rather than thinking about the kinds of products the hospital group would like to buy, it set out to find a solution to a problem peri-operative hypothermia and clear targets for improving patient outcomes. It s not about the device but the effective of implementing a solution system to a problem, as one contributor put it. The performance-based contract, ideally running for several years, turns the supplier into a partner with a clear stake in the shared goal of keeping patients warm, safeguarding their recovery, and minimising costly complications.

8 The pilot will be conducted by one hospital to begin with but could be expanded to others. Finding a site to test the approach was not easy, despite a generally positive response from anaesthesiologists and nurses, due to the considerable time and effort expected. It might also be challenging to identify a suitable supplier who could solve all the problems identified by the multidisciplinary group working on the pilot. The group hopes to calculate the quality of live and money which will be saved thanks to the value-based to procurement approach. Their findings may encourage other sites to embrace the value-based to procurement, and inspire procurement officials to test the approach in other fields Summary - A French hospital, part of a National procurement organization, is launching a tender to improve peri-operative hypothermia management - Rather than procure a specific product or service, the tender will seek solutions to the problem of hypothermia in the ICU. - If outcomes are positive, the pilot will be extended to other hospitals of the organization and clinical areas Pilot Project: United Kingdom The UK s National Health Service (NHS) is, like many public services, under pressure to do more with less. However, having picked all the low-hanging fruit when it comes to finding efficiencies, managers are finding it increasingly difficult to make spending cuts. Procurement specialists in the NHS North West see value-based procurement as a means of delivering measurably better outcomes while realising savings. The challenge is to make value-based procurement real for the finance community who might otherwise view it as an academic concept. The NHS NW, which managers 35 hospitals serving a population of seven million, has developed a guidance document for procurement practitioners, introducing them to the VBP concept but also highlighting some concrete examples of VBP in practice. The guide stresses that value is about outcomes rather than prices and requires a shift to a partnership model between supplier and procurers. Participants in the workshop welcomed the examples shared by the NHS NW, noting that VBHC is moving from being a purely conceptual topic to becoming a reality.

9 Pilot Project: Finland find value in MEAT tool The MEAT Value-based procurement tool provided a useful basis for a pilot project in Oulu, Finland. The purchaser began discussions with suppliers of cardiology balloons in February, before deciding to use the framework for a tender later in the spring. The results of the tender are not yet public but the exercise was an opportunity to test how the MEAT tool could be used in practice. Participants reported that the tool enabled them to use a common language, giving them a useful starting point for evaluation. Quality measures were used during the pilot. 50% of the evaluation was based on price with the remainder based on quality. In assessing quality, accessibility of the balloons, material strength, and the profile of the balloons were considered. For each criterion, companies were awarded 20 points if their products were rated as excellent, 10 points if the product was good, and zero if evaluators gave them a fair grade. Feedback was sought from cardiologists on their experience using the balloon. However, the pilot did not consider other quality criteria or outcomes measures beyond the benefits of physical properties of the product. Among the challenges identified during the pilot were pressures on cardiologists time. Health professionals like to be consulted but it was felt that the MEAT tool was a little complex and time-consuming for the cardiologists, prompting the development of a lighter spreadsheet for use during the tender. Another challenge arose when seeking to assign monetary value to each criterion. Again, physicians found this laborious and technical. It was suggested that a workshop could be organised to discuss how to put monetary value on quality criteria and how to define outcomes. Broadly speaking, the process was valuable and sets the scene for further use of the MEAT tool. While companies and health professionals are buying into this approach, there is still limited understanding and technical knowhow when it comes to using the MEAT Value Based Procurement tool. The Oulu pilot has itself helped strengthen the knowledge base as an example to purchasers considering new tenders. Summary - Finland has been piloting the MEAT tool with suppliers of cardiology balloons - Participants found the MEAT tool to be a valuable starting point for discussions a common language for stakeholders - Understanding/experience of value-based procurement remains limited but the pilot is adding to the knowledge based of the MEAT VBP tool.

10 FEEDBACK ON MEAT VBP TOOL Feedback from evaluators of the MEAT Value-based procurement guidelines tool has been broadly positive. Most of the 150 comments received were about the instructions for using the tool and suggestions for further improving the list of criteria. There have also been frequent questions about the methodology for quantification and assigning monetary value. MedTech Europe has taken a number of steps to improve awareness of the tool within the industry and in the broader procurement and healthcare communities. Pilots, are helping to build up expertise and highlight ways to improve how the tools is used. NEXT STEPS In 2018, a number of initiatives are planned to support increasing use of value based procurement. Pilots and case studies will continue to be developed; two sessions on MEAT VBP will be held during the MedTech Forum on 24 and 25 January 2018; and an International Roundtable Innovation, Procurement and value: Building Blocks to Sustainable, Better Value-Based health systems supported by MedTech Europe will also be held on 30 and 31 January Central to the success of the MEAT VBP initiative will be the further development of the Community of Practice. By sharing experience from projects and pilots, the community can learn from one another and build a bank of knowledge. It was suggested that a repository of success stories should be built up, perhaps owned by the Community of Practice. Thematic seminars will also be planned, focusing on themes of interest to the community and communication of these successes will continue through the newsletter and blog posts.

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