Value-based Procurement

As approximately 70% of all medical technologies are purchased through procurement, an efficient (public) procurement process is essential for all healthcare actors e.g., patients, clinical staff, healthcare providers, society and the medical technology industry. Better public procurement can help to reduce the pressure on health budgets in EU Member States, deliver better value to patients, sustain healthcare systems and foster the development of high-quality medical technologies.

Moving beyond volume- and price-based procurement, Value-based Procurement (VBP) is an innovative procurement approach that supports patient-centric, high quality and affordable healthcare and is an enabler of Value-based healthcare. VBP awards a supplier’s contract on the basis of what matters to patients and care providers and aims to have an impact on the outcomes of health care delivery and management of the total cost of care delivery.

VBP focuses on how a product or solution can best deliver desired outcomes, reduce the total cost of care and provide long-term benefits to all the stakeholders in the healthcare ecosystem, rather than focusing exclusively on initial cost of a medical technology device, which is usually equated to price.

Procurement in Europe

The European Union is committed to encourage smart procurement and to also foster sustainability and innovation. European public procurement directives address the way public authorities purchase goods, works and services. In April 2016, a new Directive on public procurement came into force, aiming to modernise procurement. Directive 2014/24/EU on public procurement emphasises the importance of value for money and quality; supporting a Value-based procurement approach. Furthermore, in 2021 the EC Expert Panel on Procurement in Healthcare regards public procurement as a means to achieve the goals of the healthcare sector and procurement to promote wider social, economic and environmental goals.

In response to the EU Public Procurement Directive, MedTech Europe together with procurement experts and the Boston Consulting Group jointly developed the MEAT Value-Based Procurement framework which provides contracting authorities a flexible and practical tool for evaluating medical technologies and solutions and applying contract award criteria that take a holistic value-based approach. The suggested framework promotes a new way of thinking while offering contracting authorities the flexibility required to suit their specific needs. This approach will deliver true value for health systems and better outcomes for patients while fostering technological innovation and investment in research.

MedTech Europe closely monitors and, where possible, informs and contributes to public procurement initiatives and developments at EU level. MedTech Europe continuously raises awareness and advises both its corporate members and national associations on (public) procurement policy issues and the latest developments at an EU and Member State level.

How to advance on Value-based Procurement

• Healthcare providers can build multidisciplinary teams and include outcome-based contract award criteria along with end-to-end costs in tenders in order to obtain most economic advantageous results; test the MEAT VBP approach via pilots; scale up step by step and share experiences.
• Policymakers can mandate a common view of value and consider the full patient care pathway; foster collaboration between providers and suppliers; and enable suppliers to be a true partner for improving health and care delivery using ‘value’ to guide investment decisions.
• Healthcare professionals can engage with procurement experts to devise clinical outcome and use criteria of relevance to optimize care delivery for inclusion in value-based procurement projects and tenders.
• Patient groups can add their support for this patient-centered approach and engage with local contracting authorities to ensure outcomes that matter to patients and informal care givers are included in tenders for medical technology.
• Industry can advocate for the VBP approach and invest in demonstrating the clear and measurable value of their technologies, services and solutions to patients, hospitals, contracting authorities, health systems and society.

MedTech Europe, by building out the Value-Based Procurement Community of Practice and engaging in EU supporting actions to deploy a Value-based procurement approach, is playing its part in advancing and innovating procurement practices throughout Europe.

MedTech Europe and Procurement

MedTech Europe and its members are engaged in a range of procurement activities including:

1. A pro-active support of Value-based Procurement by e.g. developing frameworks and guidances, organising conferences and webinars, and managing the VBP Community of Practice of practitioners.
2. A pro-active engagement in international initiatives on innovative procurement mechanisms and contracting.
3. An active monitoring of EU-related matters and contributing to the dialogue with policymakers, healthcare providers, payer organizations and clinical stakeholders.
4. An active monitoring of trends in public procurement, such as sustainability, cross-border procurement and supply chain resilience, and engaging with healthcare stakeholders on these matters.

Value-based Procurement Community of Practice

The VBP Community of Practice (VBP CoP) is originally founded and facilitated by MedTech Europe in partnership with the Boston Consulting Group and an initial group of procurers, medical technology firms and national medical technology associations. In 2019, the VBP Community of Practice was further formalized together with the European Health Public Procurement Alliance (EHPPA) joining as a founding partner.

The VBP Community of Practice is a community of natural persons from both procurement organisations and the medical technology industry showing a high level of engagement in VBP and a drive to change current procurement practice from a volume- to value-based approach. It provides a networking platform for the exchange of expertise, experience and initiatives on VBP.