Hans Bax

My name is Hans Bax, 51 years of age, and since February 1st supporting Medtech's Market Access & Economic Policies team on (MEAT) Value-based Procurement. I am holding over 25 years of (international) experience in procurement and supply chain management, especially in health care provider organisations. Before joining Medtech I have been representing the GDEKK, a Cologne-based healthcare GPO, holding responsibility for all Dutch activities and was head of procurement at the University Medical Center Groningen (Netherlands). Besides supporting the MEAT Value-based Procurement project, I am lecturer on Public Procurement and Tendermanagement at NEVI, the Dutch Association for Purchasing Management.

This blog is part of a blog series that showcases the medtech role in the different phases of the COVID-19 pandemic. Read here more COVID-19 related blogs. More info on MedTech Europe's info hub . The medical mask was a product once taken for granted, but now is being recognised as a vital tool for public health. From an ugly duckling to beautiful swan, the true value of a medical mask is finally appreciated. In an imaginary world, the story of the medical mask would have probably been like this: Made of paper, elastic and some plastic, I used to live a very modest life in the shadow of other important life-saving and quality-of-life-improving medical devices, like pacemakers, heart valves and knee implants. The people who used me regularly regarded me a product that would always be available in abundance at low prices. Most hospital buyers positioned me in the unglamorous 'routine quadrant' of the widely used Kraljic-grid. They were often ready to swap me, without hesitation, for the reasons of costs. And then, one day, everything changed. Suddenly I became more and more desirable. Demand grew. Jets were sent to fly me into Europe by the millions, I arrived in countries in the quickest way possible than before. Everyone wanted to have me and was willing to pay good money for the value I provide. I was worn by important heroes like doctors, nurses, and other frontliners. As the demand overtook the supply, homemade versions were produced by families at their kitchen tables and by fashionistas at fancy design studios. Ordinary citizens have become aware of my worth. Why? Well, everyone realized, for the very first time in my life, that I could save lives. I was no longer judged on my low cost or disposable characteristics. No, finally...
In recent years, there has been increasing attention on how we can address the biggest challenges in healthcare: variation in patient outcomes, unsustainable cost increases, and low-value care. As populations age and the rates of chronic diseases rise, we have no choice but to rethink how we get value from healthcare spending. In January, MedTech Europe and the Boston Consulting Group published their joint report ‘How Procurement unlocks Value-Based Healthcare’ on the current state of play regarding Value-Based Procurement (VBP) in Europe. VBP focuses not only on the price of a particular product or service but also on the overall value it can create. This should consider the value to patients (improved outcomes), value to payers (reduced total cost of care), and to health workers and healthcare providers (more efficient use of time and expertise). By taking a value-based approach, procurement can become an important lever for improving the quality of care while supporting the financial sustainability of healthcare systems. Wanted: bold action The MedTech Europe/BCG report points to growing momentum across Europe, with VBP being successfully implemented by several leading healthcare providers. There are encouraging examples of medical technologies being procured using the key principles of VBP. Organisations are establishing multidisciplinary teams that are motivated to find the best solution – not just the product with the lowest purchase price. Despite these encouraging words, VBP is not yet generally applied across Europe and the report points to several critical actions that need to be taken. Eliminating the true ‘root cause’ of unsustainable healthcare costs requires a paradigm shift in procurement. Hospital expenditure on medical devices and medicines amounts to approximately 20-30% of total expenditure, leaving 70-80% to other expenses. These involve mainly the cost of hospital staff to provide the ‘core’ care delivery services, but also the cost of...
In healthcare, the traditional role of procurement was to secure the availability of goods and services needed to deliver care. Once this was achieved, procurement moved one step up the ‘pyramid of procurement activities’: negotiating on product prices and discounts, in order to reduce spending on medical devices and consumables. In recent years, things have moved on. Procurers have engaged with internal multi-stakeholder interests when tendering for new contracts. This has helped to make procurement, in itself, an important business function. Looking back at how things have evolved, I think we have already come a long way. In fact, it has been quite some time now since purchasing decisions for medical devices were made only by doctors. These days, healthcare institutions cooperate at national level in the area of procurement in order to achieve greater efficiency (distribution of activities) and effectiveness (bundling of purchasing volumes and obtaining better purchasing conditions). We have even seen the first examples of cross-border cooperation: German Group Purchasing Organisations (GPOs) entering the Dutch market; EHPPA, a partnership of several European GPOs; and private clinics organising their procurement activities from a central hub, to name just a few. Despite this dramatic change for the better, I believe the ultimate objective for procurement (‘the top of the pyramid’) should be to take a strategic role: contributing to patient-centric, sustainable healthcare across Europe. However, when pooling of activities, knowledge and volume is narrowly applied only to lowering product prices, procurement misses out on achieving its full potential. Procurement cooperation offers a unique opportunity to adopt innovative procurement approaches much faster and with greater impact compared to single healthcare providers. Furthermore, by including (patient) outcome criteria in tenders, procurement can have a major impact on both the improvement of healthcare outcomes and the total cost of delivery – not...
To my mind, the overarching challenge of modern healthcare systems is to increase the value and outcomes of care, not just to control costs. As someone keenly interested in procurement, this leads me to question what it all means for how health systems buy the technologies they need. In a competitive healthcare system, like the Netherlands, healthcare provider organisations are increasingly establishing organisational strategies with clear objectives. By applying value-based procurement (VBP), which puts the primary focus on improving patient outcome, procurement systems are tasked with selecting the one(s) out of many medical devices available on the market (or to be developed) that contribute the most to the improvement of these outcomes. Identifying the outcome advantages to the stakeholders involved and finding the corresponding proof is crucial – but at the same time, very challenging – for procurement to do. Prescribing desired outcome levels, collecting outcome data and various indicators involve a lot of precious time and increase transaction costs. And of course, quite often there is a simple lack of consensus on valid and standardised measurement of ECO (economic, clinical & operational) outcomes. I believe that taking a best value approach, thus giving suppliers a proactive role in procurement, may help advance our field and deliver on the shared goal of improving outcomes. First, it is up to procurement professionals and provider organisations to determine together what outcome they wish to achieve or improve through the purchase of a specific product or solution. This could include reduced mortality, length of stay, improved patient satisfaction or increased staff efficiency, for example. Reaching out to the supplier market may also be of help here. Ideally, these objectives should be well alignedto the healthcare provider’s overarching strategic goals. Next, suppliers should be asked to submit their proposals and to identify how their...
VBP blog series
The essence of travelling, either by foot, train or plane, is replacing one's existing location for another more desired or needed one. But why do we do it? Sometimes it's the appeal of a new destination – perhaps a ski resort or a tropical island. On other occasions, the decision to move away is driven by a realisation that the current location is no longer sustainable. In healthcare, there is an emerging sense of urgency that it's time to move. You'll be familiar with the reasons: increasing demand for health care services, rising healthcare expenditure and unwanted outcome variations among healthcare provider organisations have put most European healthcare systems under pressure. I've been exploring the potential role of procurement in accelerating our journey to a better place. Traditionally, the focus of procurement was buying those products and services needed at the lowest price possible. Indeed, in some EU member states this is still common practise. However, with the transposition of the 2014 European public procurement directive into national law by all 28 EU member states, we now observe a trend of procurement slowly, but surely, selecting medtech products based on a consideration of both price and (product-) quality. Price as the sole factor influencing the buying process is a thing of the past; quality is taking its place. On average, 42% of medtech procurement processes included quality criteria in 2016. France, UK, Ireland and the Netherlands are leading the way with more than 80% of their awarded tenders based on quality versus cost. In addition, this value for money equation is legally the preferred awarding criterion in a limited number of EU member states already, such as the Netherlands and Finland. I see an even more encouraging trend: the application of pre-tender consultations, the use of competitive dialogue tender procedure...