Health procurement in Victoria
Overview
In mid-2001, a procurement model was created in Victoria aimed at providing hospitals with the economies and benefits that could come from purchasing high volume supplies at lower prices through a central purchasing facility. It was expected that central purchasing would: deliver savings to the health sector of $6-10 million in the first year; deliver ongoing savings of more than $20 million a year for the sector; ensure that small hospitals could get the same cost-benefits as larger metropolitan hospitals; lead to real savings from collective purchasing of imported hospital equipment. To this end a central procurement agency, Health Purchasing Victoria (HPV), was created in July 2001. This audit focused on determining the extent to which the activities of public hospitals, health services and HPV had delivered savings and other benefits in procuring health goods and services since then.