Helping small healthcare providers back into the fold

By Chris Wilson

SMEs are often very well placed to provide social care services. A study by Birmingham University found that smaller care providers deliver a more valued service, and that those with five or fewer full time staff offer a more personalised service as well as better value for money.

Yet many SMEs are excluded from bidding for work offered by local authorities and NHS organisations. Indeed the Federation of Small Businesses says that fewer SMEs are working for the public sector now than in recent years, and contends that the procurement system is ‘stacked’ against them. This despite the government’s aspiration that by 2020 £1 in every £3 spent would go to SMEs.

This is bad news. Care purchasers such as local authorities and NHS organisations are under pressure to deliver services to a growing population, with increasingly complex needs. In an ideal world they would call on the full range of expertise to fulfil their duty, and that range would include SMEs.

But this is not, at the moment, an ideal world. SMEs often find local authority and NHS procurement systems too rigid and inflexible, or too demanding to access, and so they’re left out in the cold.

Reforming procurement systems so that SMEs are attracted to them is not difficult. The traditional model of a ‘framework’ which can only be entered at certain times, can be transformed into a Dynamic Purchasing System which allow providers to enter at any time. Bureaucratic, expensive and time-consuming applications which offer no guarantee of work at the end of the process, can be replaced with lighter touch, simplified application systems that SMEs are more likely to find palatable.

For these reforms to be effective, SMEs need to know that the opportunities exist in the first place. It is unacceptable for local authorities not to advertise all their contracts, yet we know that some do not. And it is poor practice for suppliers to be invited to bid for contracts because of their status in informal networks, yet we know that happens.

The way past all these issues is a purchasing framework which is readily accessible to even the smallest of SMEs. Contracts should be visible to all those on the framework and only offered through it. Bidding should be minimally bureaucratic while remaining compliant with legal checks and balances.

NHS Midlands and Lancashire Commissioning Support Unit (MLCSU) uses adam’s cloud based Dynamic Purchasing System to place patients in care homes. Needs are posted to the system, and potential providers bid, often against time scales as short as 24 hours. A 60% quality / 40% cost weighting is used to help select a provider. Since starting to use adam MCLSU has grown its pool of providers, improved the quality of its management information and raised the quality rating on its placements.

Another adam user is the London Borough of Haringey whose Head of Procurement Barry Phelps says:  “We are trying to encourage more local SMEs to work with us, as it’s good for local growth and employment.”

Ensuring SMEs can access local authority and NHS contracts is in everyone’s interests. The pool of care providers increases, and high quality, locally based, sometimes highly specialist providers are included. More people have access to more care, and the local SME sector can grow.

Chris Wilson is managing director, adam