How Public Procurement can Drive More Sustainable Healthcare

  • Posted on 21.09.2016

How Public Procurement can Drive More Sustainable Healthcare


Dominika Domanska

Sustainability & Engagement Manager at Johnson & Johnson


This blog is part 8 of a series on the MEAT value-based procurement project, an initiative that advocates towards a shift from price-based procurement towards value-based procurement. It does so by defining a Most Economically Advantageous Tendering (MEAT) framework that includes the value of medical technologies, services and solutions in procurement processes across Europe. Read part 1part 2part 3part 4, part 5part 6 and part 7.

Who looks after human health – surgeon or public procurement official? The answer should be: both. The concept of Value Based Procurement helps us to explore the link between purchasing decisions and health.   

Implementation of the new Public Procurement Directive spurred discussion in the healthcare sector on how to define the best value of purchasing goods and services. While we are moving away from price-only criteria and there is some more emphasis on the overall cost of care delivery, we are still far away from obtaining most economically advantageous outcomes. Besides additional direct cost impacts driven by energy-use, cost of spare parts or disposal, one needs to quantify and take into account the savings derived from reduced patient’s length of stay, rate of readmissions, etc. This however does not capture all cost the society bears.

What is also explicitly addressed by the new Public Procurement Directive, but often overlooked in these debates, are the environmental and social aspects of delivering patient care. Meanwhile, Sustainability issues such as clean air and water, and fair working conditions are fundamental contributors to population’s health and are valued by our society. This approach should be not only reflected in the delivery of care but also in purchasing practices. Such vision of health positions sustainability as an important policy objective and challenges a narrow scope of healthcare focusing solely on management of diseases.

It is quite common to see that “Sustainability” is used in a limiting way to describe only financial sustainability of the healthcare systems. To make this term more tangible and clear we can unpack it in the context of identifying value through procurement.

First of all, we can look at product life-cycle impacts – from sourcing to manufacturing, product delivery and end-of-life management. Such a holistic approach allows us to identify the areas of biggest impacts and respectively most meaningful and valuable improvements. For some product categories it will be the amount of waste generated by the end user, for other e.g. water-use in the manufacturing process.

The impacts of a product’s life-cycle go beyond facilities of the manufacturer. Labour and environmental standards throughout the whole supply chain should be of equal concern. Benchmarking with other sectors, such as for instance, the textile industry, proves that public pressure and consumer or customer choices can drive significant improvements in the transparency of the value chain[1].

Finally, procurement reflects a health system’s decision about the design of a specific care pathway. Sustainability should be a consideration when designing new models of care or optimising existing services[2]. Investing in prevention early in the pathway, opting for e-solutions that strengthen self-care or deliver care at patient’s home – each approach contributes to patient’s empowerment, improving outcomes and minimizing environmental footprint.  That’s a win for the system and the society that can translate into economic benefits.

Sustainability is often marginalized as it is seen as a vague area which cannot be subject to a quantitative assessment. There are however ways to verify sustainable practices and policies. Requesting in tenders certification of environment management systems in place, asking suppliers about their sustainability programs or documented product improvements, including questions about ethical procurement – this is all a great start. While we cannot make the shift to truly sustainable healthcare overnight, we need to accept it is a long journey of both internal and external stakeholder education and engagement, and we need to start somewhere.

The MEAT Value Based Procurement Project framework is a great example of putting forward this broad definition of health and industry is committed to take up this challenge.  Ongoing workshops, conferences, publications are a perfect opportunity to engage the EU public healthcare sector: your purchasing power has the ability to transform supply chains and introduce new norms of sustainable practices – let’s not lose this momentum. After all, integrating sustainability in purchasing decisions is nothing else than acknowledging the link between our health, the environment and health and well-being of those who are instrumental in making sure we get the products and care we need. And what else are we all aiming for than keeping people in good health?

[2] See for instance Sustainable Care Pathways Guidance, developed by Coalition for Sustainable Pharmaceuticals and Medical Devices (CSPM)

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