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Power and Purchasing: Why Strategic Purchasing Fails.

Scott L Greer1, Katarzyna Klasa1, Ewout VAN Ginneken2

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Strategic purchasing in healthcare consistently fails due to power and information imbalances. Future policies should acknowledge these asymmetries rather than solely promoting strategic purchasing effectiveness.

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Area of Science:

  • Health Policy
  • Health Services Research
  • Health Economics

Background:

  • Strategic purchasing of healthcare is a globally popular policy concept.
  • Advocates claim it improves quality, efficiency, and population health.
  • This article investigates the implementation and impact of strategic purchasing.

Purpose of the Study:

  • To examine the effectiveness of strategic purchasing in healthcare systems.
  • To identify barriers to the successful implementation of strategic purchasing.
  • To inform future healthcare policy and strategy.

Main Methods:

  • Conducted three in-depth case studies: England, the Netherlands, and the United States.
  • Reviewed definitions and the evolution of strategic purchasing.
  • Analyzed the application of strategic purchasing in diverse healthcare systems.

Main Results:

  • No healthcare system has achieved effective strategic purchasing.
  • Four key asymmetries hinder its implementation: market power, information, financial, and political power.
  • These asymmetries limit the potential benefits of strategic purchasing.

Conclusions:

  • Further investment in strategic purchasing may not be effective.
  • Policymakers should address the fundamental sources of power in healthcare systems.
  • Policies must account for existing asymmetries and constraints in purchasing relationships.