CA IDN, Premier supply utilization
assessment savings top $5.3M
Adventist Health, a faith-based, nonprofit organization headquartered in Roseville, CA, just east of Sacramento, operates healthcare facilities in California, Hawaii, Oregon and Washington. The system includes 17 hospitals with more than 2,500 beds, approximately 18,600 employees, numerous clinics and outpatient facilities, 14 home care agencies and four joint-venture retirement centers. www.adventisthealth.org
Challenge:
Even before the most significant healthcare reform legislation in our nation’s history became the law of the land, not-for-profit hospitals and healthcare systems had to keep a keen eye on supply costs to be successful. Adventist Health, based in Roseville, CA, near Sacramento, is no exception. It has been very uncompromising in this arena since supply costs are generally second only to labor costs.
Solution:
In a unique arrangement, Adventist Health and members of the Premier healthcare alliance field force routinely carry out supply expense assessments at the West Coast-based integrated delivery system’s 17 owned hospitals.
The assessments encompass the range of hospital supply expense – all departments – and takes two to three days on site, plus about a week of data research and number-crunching beforehand, particularly including financial and supply expense data.
The team includes Adventist Health’s Materiel Management Director Vicki Pedroza and Director of Clinical Contract Management Lana Smith, as well as members of the Premier field force led by Senior Region Director Henry Luna.
Premier Purchasing Partners’ field force representatives act as account managers for the group purchasing organization. They work with members to enhance the value of contracts and other membership benefits; field force and member incentives are aligned to drive maximum impact. At Adventist Health, members of the field force are on-site, engaging daily in all aspects of the IDN’s supply chain.
Result:
- Savings in 2009 fiscal year from four hospital assessments totaled nearly $5.3 million.
- Assessments have been so successful that Adventist Health plans to include the system’s 42 affiliates.
"The great benefit here is not having an external group doing
assessments. External groups often make recommendations that conflict with our
objectives and existing agreements and contracts. They may ask vendors to bid
against my corporate agreements. All of a sudden I’m doing damage control. No
matter which consultants come in, it’s problematic. Doing it internally
eliminates that issue."
Lowell Church, assistant VP, Corporate Materiel Management Adventist Health,
Roseville, CA