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      Key highlights

      account_balance

      £1m in identified savings through smarter ISP contract management.

      electric_bolt

      Faster provider accountability enabled by clearer data and roles.

      insights

      Improved oversight and reduced contract leakage with data-driven insights.

      account_tree

      Actionable roadmap in place to drive ongoing efficiency gains.

      Rising Costs and the Need for Innovation in the NHS

      In the NHS, Integrated Care Board (ICB) are facing a significant challenge. As patient demand continues to rise and operational costs increase, the financial pressures on ICBs have never been greater. With funding constraints and a growing need to deliver high-quality care, the focus has shifted towards finding innovative ways to reduce costs and improve efficiency. One of the key areas for improvement lies in the management of Independent Sector Provider (ISP) contracts, which are one of the key areas of ICB spending. By improving the management of these contracts, ICBs can unlock substantial value and create more room to reinvest in patient care and operational efficiency.

      Independent Sector providers offer health systems in England an important alternative setting for NHS funded care. The number of patients treated by the Indepdendent Sector has increased significantly since Covid-19, in line with successive Government pledges to reduce overall NHS waiting times. Particular growth has been seen in cataract procedures and less complex orthopaedic surgery.

      Michael Allen
      Michael Allen

      Partner, UK Workforce Lead

      KPMG in the UK

      Given the important role that the independent sector plays in NHS care, it is important that these services are held to the same quality standards as NHS Providers, and are as such engaged as key partners as health systems move to a more financially sustainable model.

      Recognising the potential, Staffordshire & Stoke-on-Trent (‘SSOT’) ICB identified contract management as a key opportunity for improvement. They engaged KPMG to work in partnership with and support the delivery of both immediate and long-term value through a strategic, collaborative approach. Their goal was to optimise contract management, improve operational efficiencies, and ultimately deliver both immediate and long-term financial benefits.

      A Collaborative Approach to Driving Value

      To unlock significant value from Independent Sector Provider contracts, SSOT ICB and KPMG partnered to take a strategic, collaborative approach. By bringing together key stakeholders and leveraging data-driven insights, they identified critical opportunities to improve contract management, reduce costs, and enhance operational efficiency. This process not only delivered immediate benefits but also created a strong foundation for continuous improvement.

      The partnership between SSOT ICB and KPMG focused on identifying high-value ISP contracts with the greatest potential to unlock savings. Through a series of workshops, clinical leaders, operational teams, finance, procurement, and contract management personnel collaborated to ensure all stakeholders were aligned and fully committed to the shared objectives. This collective effort clarified roles and set clear expectations on the actions needed to deliver value.

      Several key opportunities for improvement were uncovered across multiple areas, including reducing contract leakage, optimising clinical pathways, and enhancing operational efficiencies. By adopting a data-driven approach to analyse and quantify these opportunities, the ICB gained a deeper understanding of their contract spend, pinpointed areas where costs could be cut, and identified how resources could be more effectively allocated.

      The review also revealed the need for additional contract management support in certain service areas, highlighting the potential value from stronger contract oversight. Beyond identifying immediate opportunities, the process empowered operational leads to challenge providers more effectively and recover historical overpayments where applicable. Importantly, it laid the foundation to upskill the existing ICB team in contract management—enabling them to identify key triggers and request data in the correct format from providers. With this information, operational leads can swiftly analyse and engage in more informed, constructive discussions with providers, maximising ongoing financial benefits while maintaining high-quality service delivery.

      Throughout this process, challenging and insightful discussions helped refine the improvement initiatives to ensure they were both achievable and impactful. This collaborative approach resulted in a clear, actionable plan for delivering sustained value in both the short and long term.

      The impact of this collaborative approach goes beyond immediate savings — it transforms how teams operate and make decisions, unlocking sustained value that directly supports better patient outcomes. By empowering ICB teams with clearer insights and stronger contract management skills, we enable them to drive continuous improvements, reduce waste, and reinvest resources where they matter most. This is how real, lasting change happens on the ground.

      Ankur Gupta

      Contract Performance Lead for Healthcare

      Sustainable Results and Future Improvements

      The collaboration helped the ICB identify over £1m of saving opportunities, contributing to improved financial efficiency and better resource allocation. This was achieved through optimised contract management, improved clinical pathways, and streamlined operational processes. More importantly, the work laid the groundwork for ongoing improvements, ensuring that the ICB would be able to continue driving further efficiencies and reducing costs in the future, in turn building a more financially sustainable and resilient care system. 

      The action plan developed through this process provided SSOT ICB with a roadmap for continuous improvement, helping them enhance their contract management capabilities and operational efficiencies moving forward.

      Client Feedback

      We are extremely pleased with the partnership. While the financial benefits will boost our position, the process was smooth, engaging, and impactful. The team’s expertise and collaborative approach helped us not only identify immediate opportunities but also build a framework for continuous improvements. The workshops and the action plan have set us on a clear path to improve both our operational efficiency and contract management capabilities for the future.

      Lee Squire

      System Collaborative Programme Director – Contracts

      Wider Opportunities Across ICBs

      There are a total of 42 ICBs in England and there is a substantial opportunity for all by taking a closer look at their third-party spending, particularly in the management of contracts. By improving contract management, ICBs can not only unlock quick, tangible savings but also improve relationships with suppliers, gain better quality data for operational leads, and empower teams to have more productive discussions with providers. Ensuring that quality services are met while working together to save money can free up resources that can be reinvested into patient care.

      While ISP contracts are just one example, there are numerous other categories of third-party spend where ICBs can drive similar improvements. By addressing these areas, ICBs can deliver lasting cost reductions, enhance service delivery, and continue to improve efficiency across the NHS. These initiatives are not just about cutting costs —they are about creating a more sustainable, efficient, and patient-centred healthcare system.

      The scale of opportunity across all 42 ICBs is significant — but it requires a shift in mindset. This isn’t just about tightening procurement; it’s about leveraging commercial levers to support system-wide transformation. By taking a more strategic view of third-party spend and contract management, ICBs can unlock hidden value, drive meaningful operational change, and reinvest in the outcomes that matter most. With the right insight and collaboration, the NHS can move from reactive cost-saving to proactive value creation.

      Rachel Flowerday

      Contract Performance Lead for IGH

      account_balance

      Optimising Contract Management at Royal Berkshire NHS Foundation Trust, aligned with NHS Commercial Framework
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