Commercial Impact
Ramsay Group operates a global network of 530+ healthcare facilities across 11 countries. The Covid-19 pandemic exposed an over-reliance on a ‘single’ income source. All elective activity (e.g., joint replacements, cataracts), the primary income source, was halted overnight, but a high fixed cost base remained. As a response, Ramsay UK embarked on an ambitious growth and efficiency programme. Curzon Consulting was engaged to design and deliver a Procurement Transformation programme.
Over nine months, we took a pragmatic, agile and “together” approach to accelerate benefit delivery, particularly in high spend / high complex clinical spend categories. By assessing the existing Procurement Organisation (PO) against a methodical and objective review against eight dimensions we highlighted several data-driven insights; fundamentally, the PO only managed 44% of total spend; hence lack of PO involvement resulted in suboptimal category / supplier management and savings delivery. Improvement opportunities were incorporated into the design of the new PO. Our methodology, leveraging our proprietary data analysis algorithm, was specifically adapted to address demand side cost optimisation levers. Whilst we addressed a range of spend categories and redesigned the PO, we delivered sizeable benefits in a difficult clinical area such as Orthopaedics.
Through a deep dive into orthopaedics a key benefit delivered in Orthopaedics came from ensuring the Surgeon selected the appropriate implant system (metal or ceramic) to match the patient’s profile (e.g., age, gender). A well-established norm in Orthopaedics is to routinely implant, high quality, lower cost metal vs. ceramic hip systems into older patients. Our analysis showed Surgeons at Ramsay UK implanted costly ceramic hip systems in a high percentage of older NHS patients. The NHS reimbursement for a complete hip replacement was fixed, so every incremental switch from ceramic to metal impacted the bottom line.
Surgeons had comprehension of how their hip selection decisions impacted Ramsay UK’s profitability. Our insights directly influenced the Orthopaedic Steering Group’s new policy which required Surgeons to utilise lower cost metal hip systems in older NHS patients.
Fundamentally a key part of the relationship was to ensure recommendations on cost improvement would not compromise clinical outcomes and patient satisfaction.
We delivered £multi-millions in incremental savings and a new PO. Ramsay UK will benefit from the savings over multiple years.
Commenting on the success – Ramsay Health’s CFO Peter Allen said:
Curzon helped us obtain the confidence and operational ‘can-do’ to drive incremental savings sooner than we could have expected, and then to push on to best practice performance.
Their skill was in balancing pace of change and the results imperative with the need to take the organisation with them on the journey. A key achievement was building the necessary collaboration between the many functions that needed to act together to drive benefits in complex clinical spend categories.
Curzon’s strong analytical expertise, and ability help us to take a critical view on the “art of the possible” and bring the team along on the journey to demonstrate benefits delivery was a critical success factor.
View the Curzon Consulting profile in the MCA Members Directory.