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DHBs and Health Benefits launch National Procurement Service

DHBs and Health Benefits launch National Procurement Service

Health Benefits Limited (HBL) and its shared service partner healthAlliance, have launched the National Procurement Service, an initiative with the potential to save District Health Boards (DHBs) around $90 million over the next two years.

All 20 of New Zealand’s DHBs have signalled their support and signed National Procurement Service agreements.

HBL Interim Chief Executive Officer, David Wood says by working together significant savings can be made for reinvestment by the DHBs into frontline, patient-facing services.

“Every year DHBs spend about $1.3 billion buying goods and services, including everything from cotton-wool buds and stationery through to hospital beds and surgical equipment,” he says.

“By taking a national approach, through the National Procurement Service, the combined purchasing power of DHBs ensures the best possible prices can be negotiated across the sector.”

Mr Wood adds that over the last year, healthAlliance has delivered $23.8 million in annualised savings from working with the four Northern Region DHBs alone. It is expected that these savings can be replicated on a national basis.

“HBL does not own hospitals. Our role is to identify opportunities for innovation and reducing costs, then work in partnership with the DHBs to realise benefits,” he says.

National Procurement is the first service to be delivered on a national basis as part of the Finance, Procurement and Supply Chain (FPSC) programme.

The sector, with HBL’s support, realised cumulative benefits of $213m at the end of the 2012/13 financial year. Cumulative benefits are estimated to be $303m by the end of the 2013/14 year.


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