An open market will drive good value for money in updating PACS in the NHS

Harry Wood talks to Peter Harrison and Ronan Kirby of Siemens about the future of PACS in the NHS in England following the end of NPfIT contracts.

3 April 2012

How do you see the current situation with the PACS market in England?

PACS was a low hanging fruit and was a relatively easy component for the NHS National Program for IT (NPfIT) to deploy. For Siemens it was an interesting time as originally we had actually put the first PACS into the UK.

We were the number two player in the UK, but regrettably we were not selected by any of the Local Service Providers (LSPs) to take part in the NHS National Program for IT (NPfIT) in England. Basically we were not included as a provider as we lost on price.

The good news as far as we are concerned, was that as we are part of a global organisation, we have continued to develop our portfolio over the last eight to nine years. We have a strong portfolio and the market is starting to open up again. The benefit of NPfIT was that it accelerated the rollout of PACS in England.

It is interesting to observe the price that was paid — both the capital and the revenue cost — wasn't cheap, and also bearing in mind that Siemens was excluded on price. It is very clear that the deployment was pump primed with a central funding subsidy for rolling out the NPfIT PACS. When you look at the actual net price that was paid and add that central funding in, it raises some interesting questions with respect to value for money.

To ensure that you get value for money you need an open and competitive market and I'm pleased to say that is where we are moving post NPfIT, and the opportunities are opening up to the vendors that are not bound to the LSPs.

Trusts are now procuring outside of the NPfIT/ LSP route and it is a more open and competitive market, which is good for consumers and the NHS trusts as it will drive value for money.

Q. What is the situation with the current PACS contracts for NPfIT?

There was an interesting development last year in that at least one vendor that I am aware of offered its customer base a significant discount against the current pricing to extend their current contract.

Now of course the value of the discount is relative to the price originally paid. So I would question whether the net price after discount still represents good value for money and the only way to find that out is to compare with every market offering.

What actually happened was that trusts were told that if they signed to an extension by a specific date they would enjoy this level of discount for that extended term. I understand they were given quite a tight deadline in which they had to respond.

It immediately begs the question why, if it is a great deal today, would it not be on the table tomorrow? It is not a normal sales technique for closure.

Q. Is there not a requirement for trusts to get best value for money?

It is incumbent on the trust to ensure that they are getting value for money and to see what can be obtained on the open market. A trust needs to make an informed decision whether that does represent good value for money. The only way to get that is to check the market price.

It is encouraging that the market is opening up. However, I have some concern about how this is being done because what we are seeing at the moment is some trusts going to the market with some very detailed pre-qualification questionnaires (PQQ).

Normally you use a PQQ to establish who are the bidders capable of delivering the requirement and then in the invitation to tender (ITT) stage selecting down from a suitable candidate list. We are tending to see the PQQ is being used to whittle the candidates down prior to issuing an ITT, which is legitimate.

It is because there are so many players in the PACS market now that some of the procurement outfits in the trust are wary. For example, you wouldn't want to run an ITT and have 20 or even 12 ITT responses to evaluate and they are using the PQQ to limit the number of players they send the ITT to.

Which ever way you look at it, NHS trust or vendor, completing the very detailed PQQ and ITT responses is onerous and costly for all parties. There is talk of the establishment of a framework that will enable trusts to call up applications from suppliers on a framework under the OJEU. Once a framework is in place, trusts could go to the framework operator and say they would like to go to a buyer on this framework and negate the requirement to run a full OJEU procurement themselves.

My view is having PACS on a framework is to be welcomed. It is good for suppliers and trusts as it will facilitate more agile procurement, negate replication of work and improve efficiency in the supply chain.

Q. Would a framework include a requirement for interoperability standards, and would the operator have enough knowledge about standards?

I think you would want whoever operates the framework to take informed decisions and be mindful of standards and interoperability etc. Whether they have competence in the organisation or buy it in, they should be able to do it. We have worked with NHS Supply Chain on the sale of imaging modalities and my experience of working with them there is that they adopted a robust approach to validating suppliers.

If you are selling PACS and are not DICOM compliant you have a problem. You have to sell products that are fit for purpose. On the understanding that we work in a multicentre environment and there is a requirement to interoperate with other systems and modalities, of course you need interoperability standards, and that is why you have DICOM, IHE, HL7.

I would anticipate any framework operator, in selecting PACS vendors to sit on that framework, would ensure a minimum set of requirements in that regard.

An informed market would ask for those requirements. But should it be incumbent on every NHS trust to have that level of competence and foresight to be requesting all these things? It would be good for all, for efficient operation, if a framework operator were to prequalify a vendor and their products on the basis of a minimum set of interoperability standards, and take away some of the need for competence from the trusts.

On the wider issue of image sharing, NPfIT decided that each of the five LSP regions in England would have one local store for sharing images. There was an issue in the speed at which these were set up and there were several usability issues, as I understand. Forwarding of the images was not dynamic. It was a store-and-forward system that was typically operating within a trust.

So if you acquired an image and wanted someone else to access that image on the store, there was a latency in getting that image on the store, which could be 24 hours, which of course didn't work for everyone.

Another issue was accessing an image if you are outside the area of the LSP that is hosting the image. They established an image exchange portal (IEP) which was very basic. As its name implies, it gave the ability to post an image on the portal and make it sharable.

There was an absurd situation. Trusts had LSP PACS installed but nevertheless were spending small fortunes on motorcycle couriers to send CDs to other locations to share images. There were plenty of anecdotal examples of that, which were quite ludicrous, in terms of expenditure, cost and time.

I wouldn't want to suggest that there hasn't been progress, as there has been tremendous progress. However, there could be improvements in terms of value to end customers by opening up the market, establishing a framework for procurement and, in particular, in terms of requirements such as image sharing.

Q. Are the portals really a suitable solution to the problem of sharing images?

The IEP "does what it says on the tin". It allows sharing of images between sites. It is a relatively manual process. A request is sent from one site to another saying please share this image set. This is done from within the IEP application, using email.

An application is sent to the hosting site, which sends the images to the hosting site manually and a message is sent to the requester saying the images can be viewed. So it is purely a manual process and is quite cumbersome.

The problem is that when the specifications were originally set by NPfIT there were no international specifications to allow image sharing across the enterprise. The technology wasn't standardised and each company had a different way of doing things, so when you had different companies and trusts involved it made sharing difficult. Now the standards are there and they are putting in this specification for new systems.

The idea is that the market should dictate what is available for the end-user requirement and the market has moved to a standardisation policy using international standards. Now any CT scanner or PACS that is purchased is DICOM compliant. The various PACS and RIS can talk to each other and information can be shared.

Q. But at the moment there is still no requirement?

The requirement for standards is likely to be included in any replacement project for 2013, when the contracts are renewed.

I think there is recognition that there are requirements in this area. The people that are coming into the market are pretty well informed. It is incumbent upon the procuring trust that they are getting value for money. How do you test this without doing a market test? A framework will assist in that process.

Running an ITT and PQQ exercise has a big cost and it is a time-consuming process. You also need the expertise to know what you are asking for. If there is a framework in place, all that has been done, so you should then be able to go to the framework operator with your requirements and ask how much it would cost for a specific 'size and shape'. The framework operator in conjunction with the supplier should be able to respond and say you can buy it on the framework, without having to go to OJEU, and outline the deal.

You should also be able to ask how it compares with another PACS. The framework operator should be able to say if that is also on the framework, what the price would be, and the difference in the scope. The point is a trust can make an informed decision in an agile manner and they are getting a true market test.

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Following this discussion, NHS Supply Chain announced on 27 March 2012 that it is to launch a new PACS and RIS framework.