April 19, 2017 – The financial pressures facing the NHS again hit the news further to the Chancellor Philip Hammond’s Spring budget. While an additional £425 million is being made available for investment in the NHS – to fund the first set of the best STPs and help cope with demand in A & E this winter – the sad reality is the NHS still lacks the money it needs.
The chief executive of The King’s Fund, Chris Ham, echoes this in his blog, “The inescapable conclusion is that any prospect of increased NHS funding during this parliament is even more remote… The Prime Minister and Chancellor will have to live with the consequences of promises made by their predecessors, and the likelihood of a continuing deterioration in the standards of care patients experience in the NHS.”
However, there are initiatives by private firms to assist. Genmed, a managed service provider specialising in the health sector, today announces the opening of a new Information Office for press and analysts interested in NHS funding and who require commentary from commercial experts.
- Genmed has introduced funding methodologies to help address the current lack of additional capital available within the NHS to invest in surgery, pathology, endoscopy, IT and information management, facilities and legacy medical records digitisation.
- Using its managed service model, Genmed works in partnership with Trusts and Health Boards to create a bespoke solution with costs packaged using an umbrella contract with the service billed monthly or quarterly. All project costs are ‘smoothed’ with no big upfront investment required.
- Genmed is vendor neutral such that if a NHS organisation wants equipment from a variety of companies, this can easily be incorporated with clinicians not forced to have products they don’t want.
- Genmed approach since start up is closely aligned with all the key directives highlighted by Lord Carter of Coles in his report to improve the efficiency of hospitals.
What’s the benefit to the NHS?
- Genmed is not a managed equipment provider or a finance house. Its remit is much wider. It is more consultative working with Trusts to ascertain what clinical facilities or technology they need, their workload issues, finding and selecting suppliers, driving product costs down, putting together the finance, managing the contracts, paying subcontractors and taking all the risk upfront itself.
- Genmed helps NHS organisations to increase their efficiencies and streamline their practices by removing the administration overhead and burden of managing suppliers, dealing with orders and invoices, in addition to contract management.
- HMRC compliance means the 20% VAT saving on Genmed managed services allows more money to be used for front line activities and the treatment of patients.
- Genmed’s approach means that its contracts can be self-funding. For example, the company has just partnered with EDMS vendor, CCube Solutions, to offer a fully managed service for Trusts seeking to shift from paper to digital medical records. All costs can be included in this such as the EDMS software, IT hardware and outsourced scanning. To close a medical library and go paperless typically costs more than £1 million. A managed service means a Trust can close a library, get rid of the paper and vans required to deliver them, redeploy people – or reduce headcount – and the cash saved can immediately be used to pay for the service.
How does it work?
- Genmed’s managed service costs are treated as an operational not a capital expense and are off balance sheet which is critically important for Trusts and Health Boards with no CRL headroom.
- Not only can project costs be spread out, but under HM Treasury directive rules for contracted out services, public sector organisations including the NHS can recover the VAT which means a 20% refund by HMRC on Genmed managed services billing.
- Genmed’s actual pricing for its contracts is completely transparent. It charges a 6% fee on cash flows. So, for example, if a managed service contract is worth £100,000 per quarter, the customer will be billed £106,000 plus VAT. It’s simple and straight forward with the whole approach tax efficient making its approach extremely compelling.
- In line with Lord Carter’s recommendations, Genmed also removes the back-office administration burden of contract and invoice processing from Trusts and delivers this for them ensuring that orders are managed and chased, supplier billing is paid and reconciled, and regular management information is then provided. Given volumes can be high, this is a massive benefit for Trusts who make tens of thousands of orders each year generating hundreds of thousands of invoices. The charges for this are all included in Genmed‘s 6% fee such that Trusts get great value from its managed services.
 Electronic document management software
 Capital Resource Limit is the cap on capital spend in a year which a Trust cannot exceed.
- Genmed works with over 40 NHS Trusts around the country where, to date, it has 220 contracts supporting a variety of clinical disciplines.
- Genmed was founded in 2007 and is based in London and Wales. Its contract portfolio currently totals around £430 million. Genmed’s asset finance requirements are funded by large blue chip partners including Societe Generale, GE Capital, Macquarie Bank and Lloyds Corporate.
- Genmed is an approved supplier on various NHS Framework agreements including NHS London Procurement Partnership, NHS Shared Business Services, NOA and Crown Commercial Services. This means that NHS organisations avoid having to go through the time-consuming and costly OJEU tender process to procure and buy services.
Open during normal office hours, the Genmed Information Office can support you by:
- Arranging briefings with senior executives who can provide commentary, without hype and hyperbole, about what it is happening today with NHS funding, provision of clinical equipment and IT, views about future trends and so on;
- Providing access to NHS customers who can speak openly about their decisions to use a self-funded managed service to deliver projects working with Genmed;
- Discussing how NHS organisations can work with a managed service supplier so the most value is gained from the relationship.