PROCUREMENT
changes clinical decisions in time to mater and if the surrounding pathway supports that change. From a procurement perspective, VBP
typically translates into two parts. Firstly, a specification that sets non-negotiable requirements, such as regulatory compliance, analytical performance, interoperability and safety. And secondly, a value scoring model that compares bids on atributes that go beyond the baseline; for example, demonstrable reductions in length of stay, avoidance of imaging, staff time released, or earlier treatment starts. Contracts may include performance measures and, in advanced cases, risk-sharing clauses that align payment with delivered value.
VBP challenges in pathology Three structural features of diagnostics make VBP harder to implement than in other categories. First, diagnostic value is indirect; tests generate information which only translates into health benefit when acted upon by clinicians, patients and services. This dependence complicates atribution: how much of the observed improvement is due to the test versus pathway redesign or clinician behaviour? Second, outcomes are diffuse and often realised outside the pathology budget. A rapid molecular assay in acute care may reduce admissions or bed days, benefiting wards or commissioners rather than the pathology cost centre that pays for the test. Third, many elements sometimes scored as ‘value’ in diagnostics (connectivity, quality controls, usability, training and aftercare) are, in reality, baseline compliance features required to operate safely and effectively. Conflating these with value-added benefits dilutes the purpose of VBP and risks rewarding suppliers for meeting minimum standards. On the supplier side, especially for small and medium enterprises (SMEs), building health-economic models and collecting longitudinal real-world evidence can be prohibitively resource-intensive. On the buyer side, stretched teams may lack the time or expertise to interpret complex submissions. The result is a tendency to fall back on unit price, even when
For scientists and laboratory leaders, succeeding in a VBP environment means broadening the narrative from analytical excellence to pathway impact.
everyone recognises that price alone is a poor proxy for impact.
System barriers:
data, budgets and contracts Data infrastructure remains the principal botleneck. To compare value credibly, NHS buyers need linked datasets that connect diagnostic use to downstream clinical events and costs. Many organisations lack mature data flows between the laboratory information management system (LIMS), the electronic patient record (EPR) and finance. Without this linkage, claims about reduced admissions, avoided procedures or shorter pathways rely on assumptions or small studies that may not generalise. Budget silos present an equally
stubborn barrier. Pathology departments typically purchase the test, while the financial benefits accrue in different parts of the system. Unless governance allows cross-budget investment decisions, opportunities that are net-positive for the system may still be declined at the local budget holder level. Finally, contracting models often
remain transactional. Traditional tenders
emphasise specification compliance and unit pricing, with limited mechanisms to share risk or reward based on delivered outcomes. For diagnostics, where value depends on behaviours beyond the supplier’s direct control, outcomes-linked payments must be carefully designed to reflect shared accountability across supplier, laboratory and clinical service.
Budget silos present a stubborn barrier. Pathology departments typically purchase
the test, while the financial benefits accrue in different parts of the system
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WWW.PATHOLOGYINPRACTICE.COM May 2026
What ‘good’ evidence looks like While randomised controlled trials are uncommon in diagnostics, robust value cases are still possible. A practical evidence package typically triangulates multiple sources: Analytical and clinical performance: sensitivity/specificity, predictive values across relevant prevalence ranges, concordance with reference methods, failure rates, and quality controls. Operational metrics: turnaround time, throughput, hands-on time, staffing mix, consumable logistics, maintenance burden, and uptime. Pathway impact: changes in triage, time-to-treatment, avoided repeat appointments, reductions in unnecessary imaging or cultures, and effects on length of stay. Economic model: whole-system cost impact that captures both direct laboratory costs and downstream costs (admissions, procedures, clinic time), with transparent assumptions and sensitivity analyses. Implementation dependencies: training requirements, IT integration milestones, protocol updates, and governance steps that must occur for benefits to be realised.
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