HealthShare Victoria procurement

Why this is important

HealthShare Victoria (HSV) is an independent statutory authority with responsibility for managing procurement and logistics for Victoria's public health system. In its procurement role it negotiates 'collective agreements' – single-source contracts for goods and services that health services then must use if one exists for the relevant good or service.

In 2023 HSV stated it had $1.4b of value under its collective agreements. Use of collective agreements is continuing to expand. HSV is both building the portfolio of collective agreements and bringing further health services into those agreements, as health services’ legacy contracts expire.

For 2022–23 HSV claimed its operations had delivered $202.3m in 'sector wide benefits', including a $27.4m cost reduction for health procurement.

Given that public health services must use collective agreements and the ongoing expansion of their coverage it is appropriate to consider the extent that the savings from collective agreements can be quantified when compared to equivalent market prices.

What we plan to examine

We plan to examine the extent to which collective agreements are delivering cost savings to health services, and the robustness of HSV’s method for assessing benefits realisation.

Who we plan to examine

HSV and selected health services.