The Supreme Office for the Republic of Srpska Public Sector Auditing has conducted a performance audit titled “Public procurement management in the Republic of Srpska`s Healthcare”.
The purpose of this performance audit was to examine the management of centralized public procurement in the Republic of Srpskas Healthcare and its impact on the functioning of public health institutions, as well as the provision of healthcare services, and based on the conducted examination to offer recommendations which implementation by competent institutions can improve performance of public procurement in the Republic of Srpskas Healthcare.
The findings of the audit have shown that the legal, organizational and managerial preconditions that should be in place for the successful functioning of centralized public procurement were not fully established.
Public procurement planning in the Republic of Srpskas healthcare is conducted through two completely separate, inconsistent and unrelated processes that result in public procurement plans that are not an instrument for public procurement management. Public procurement planning in the Republic of Srpskas Health Insurance Fund for the needs of public health institutions in the amount of almost 400 million KM in the observed period 2016-2018. did not precede the procedure of collecting the needs for medicines and medical supplies from public health institutions for whose public procurement was planned and carried out. The planning of public procurement in public health institutions is conducted under conditions of untimely contracting of health services provision between the Republic of Srpska`s Health Insurance Fund and public health institutions and with inconsistency in the collection, identification and expression of needs for medicines and medical supplies by public health institutions.
The planning, preparation and implementation of centralized public procurement were not preceded by organized and planned research and analysis of the medical market. Procurement procedures for individual procurement items are not initiated in a timely manner, but upon expiry of the applicable framework agreements and contracts. The time required to carry out centralized public procurement ranged from 3 to 16 months. The duration of public procurement procedures was also influenced by the duration of the appeal proceedings outside the jurisdiction of the contracting authority, which ranged from 12 to 125 days and in most cases fell outside the time limits prescribed by the law. A significant number of centralized public procurement procedures were not successful due to the lack of competition, the quality of tender documentation, the untimely initiation of proceedings, the duration of the procedure, the selection and application of contract award criteria, the course and outcome of the appeal procedure.
It was found that the Republic of Srpska`s Health Insurance Fund and public health institutions had achieved different prices for the same procurement items.
Problems in centralized public procurement were reflected in the functioning of public health institutions and the provision of healthcare services through the present shortages of medicines and medical supplies, which were most often overcome by public health institutions through their own parallel / extraordinary public procurement, directing patients to obtain medicines or medical supplies themselves for provision of healthcare services which resulted in a significant amount of reimbursement to insured persons and referral of patients to other healthcare facilities.
It is not established adequate control, reporting, monitoring and evaluation system in the Republic of Srpska that would be an effective mechanism in the Republic of Srpska public procurement management.
The performance audit has concluded that centralized public procurement in the Republic of Srpska’s Healthcare in the previous period was not managed in accordance with the principles of economy, efficiency and effectiveness, which had an impact on the implementation of basic principles of healthcare in the Republic of Srpska.
Based on findings and conclusions based on relevant, reliable and sufficient audit evidence, audit recommendations have been created. Recommendations are addressed to institutions that have responsibilities in the field of public procurement management in the Republic of Srpskas Healthcare: the Republic of Srpska Government, the Ministry of Health and Social Welfare, and contracting authorities in the Republic of Srpskas Healthcare.
The complete audit performance report is available on the website of the Supreme Office for the Republic of Srpska Public Sector Auditing.