Healthcare procurement in the Public Sector

A third of all public spending goes towards procuring goods, works and services from external suppliers. In 2022 this saw the publication of over 50,000 contracts in the UK, creating countless new business opportunities for all types of industries. Healthcare-related tenders accounted for around 20% of these opportunities.

Who makes healthcare procurements in the public sector?

Healthcare is managed differently across the UK, with healthcare-related procurements conducted by commissioning groups, councils, boards, and other approved contracting authorities.

Looking through our tender categories, you will see contracts published by the Department of Health and Social Care (top of the healthcare hierarchy) to independent contractors.

How does the public sector buy healthcare-related services?

Like other areas of the public sector, healthcare contracts over £213,477 (£138,760 for central government procurements) must be advertised publicly - meaning any suitable suppliers can bid for the work. The requirements for each contract will differ, and you should always check that you meet the eligibility criteria.

More recently the UK Government has reviewed how the entire public sector conducts its procurements, and has introduced new priorities to help the UK achieve its wider objectives. We have provided details of these priorities below, and you can use this information to strengthen your offering when bidding for work.

Social Value

Contracting authorities need to consider the social, economic, and environmental impact of procurement decisions.

  • Help maintain a healthy market by designing strategies and contracts that help to remove barriers to entry, take advantage of innovations, and promote competition.
  • Make procurement decisions which contribute to the UK government’s legally binding target to reduce greenhouse gas emissions to net zero by 2050, and prioritising opportunities to reduce waste.
  • Create a more diverse supply chain to deliver the contract, which will better support start-ups, small and medium-sized businesses and VCSEs in doing business on public sector contracts.
  • Focus on strategies which will deliver lower cost and/or higher quality goods and services, while also encouraging increased productivity and the adoption of innovation.

Market Engagement

Contracting authorities should explore making procurement more efficient for suppliers.

  • Where possible, keep the market informed of upcoming projects by publishing pipelines for the next 3-5 years - giving suppliers plenty of time to engage with buyers and prepare for upcoming contracts.
  • Use longer-term contracts, standardise requirements and collaborate with other contracting authorities to achieve faster, better, and greener projects.
  • Achieve value for all by creating sustainable, resilient, and effective relationships with suppliers.
  • Improve safety, enable innovation, reduce costs, and produce more sustainable outcomes by encouraging suppliers and buyers to adopt the UK Building Information Management (BIM) Framework.
  • Engage with suppliers earlier, offering opportunities to make recommendations on design, cost, risk management, and structuring of projects.
  • Focus on whole life value ‘Outcomes’ rather than ‘Scope’ to encourage suppliers to consider the government's wider economic, social, and environmental priorities.

Improved Procurement Processes

Contracting authorities should ensure the best processes are used and value for money is achieved.

  • Use DMAs (Delivery Model Assessments) ensure evidence-based processes are used to determine the best delivery model for projects.
  • Conduct earlier risk assessments to mitigate these before construction begins, and ensure each part knows which risks they are responsible for.
  • Improve safety, enable innovation, reduce costs, and produce more sustainable outcomes by encouraging suppliers and buyers to adopt the UK Building Information Management (BIM) Framework.
  • Establish the best pricing based on the delivery of outputs, work value or supplier performance - price should reflect the level of certainty or risk around the scope and requirement.
  • Assess the economic and financial standing of suppliers to safeguard the delivery of projects.
  • Mitigate the impact of insolvency by asking suppliers to provide resolution planning information in the form of a Service Continuity Plan (previously known as Business Continuity and Disaster Recovery Plans).

While these policies focus more on contracting authorities’ internal processes, it is vital that you know what buyers are looking for so that you can avoid misunderstandings by displaying vital information in the correct format.

How do I find healthcare tenders?

There are hundreds of portals through which public bodies can advertise their healthcare-related needs. Many businesses try searching these portals frequently, and end up wasting time they could spend on creating strong proposals.There are numerous challenges you need to be aware of if attempting this.

If you want to avoid these challenges and develop a robust strategy for the public sector marketplace, Tenders Direct is the service for you. We collate every public sector contract in the UK and ROI, as well as applicable OJEU notices, and make them available to you from a single source.

We will alert you of any relevant contracts as soon as they are published, as well as giving you access to our entire database – allowing you to search historical notices, find live DPS, and research the market.

Information about the market