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12 March 2021

Medical gas review saves costs for DHBs

NZ Health Partnerships (NZHP) will achieve $0.2m in savings this year for 17 district health boards (DHBs) through its annual medical gasses pricing review.

The new prices for medical gasses (including oxygen, carbon dioxide, nitrous oxide) are now fixed for 12 months  (1 November 2020 – 31 October 2021).

“We are aware of the current deflationary environment with COVID-19 and its negative impacts on things like fossil fuel prices, and we saw an opportunity to negotiate a better result for DHBs,” says NZHP Procurement Category Manager, Alistair Baxter.

NZHP’s data-driven information about how DHBs spend on medical gasses enabled it to review and negotiate cost avoidance ($0.16m) and cost reduction ($0.05m) benefits on behalf of all DHBs.

NZHP calculated the “deflation” in charges ($0.05m) based on an analysis of the last 12 months of medical gas sales data to DHBs, and a price escalation model which has indexes from Statistics New Zealand.

The medical gasses review is an example of NZHP’s mission to use data and analytics to help New Zealand health get the best value from the products and services it purchases.