Hospitals Save $165 Million in Two Years Using Value-Driven Purchasing

CHARLOTTE, N.C.--(BUSINESS WIRE)--Premier healthcare alliance member hospitals and care sites have identified more than $165 million in savings over the past two years by purchasing quality products at low costs through enhanced group buys.

“With the changes that are occurring in healthcare, hospitals must find ways to safely reduce costs. For our members, there’s truth in the collaborative power of the Premier alliance as it accesses high-value products and services that help them deliver safe and efficient care”

Premier’s group buy program delivers value with coordinated, volume-driven purchasing opportunities. The program also allows smaller facilities like physician offices, ambulatory surgery centers and nursing homes to achieve benefits, whether in negotiating value-adds or bottom-line dollars saved.

“Summa Health System has realized significant savings from identifying and benchmarking opportunities in Premier’s group buy program. We have taken particular advantage of the imaging modality group buys,” said Jay Mitzel, Summa’s system director of purchasing. The imaging group buys that Summa participated in accounted for nearly $2.1 million of their $3.8 million total in savings from the program last year.

Members of Yankee Alliance also saved more than $5 million using Premier’s group buy program over the past two years – specifically for magnetic resonance and ultrasound imaging products.

As a provider-owned performance improvement alliance of more than 2,600 U.S. hospitals and 88,000-plus other sites, Premier operates a leading healthcare purchasing network with more than $4 billion in annual savings and close to $43 billion in annual purchasing data. Since 2006, members participating in Premier’s group buy program have saved more than $415 million and purchased nearly $2 billion in products.

Group buy program events offer participants value-adds such as early shipment, special financing rates, trade-in programs, preventative maintenance, training, service programs and extended warranties. The program consists of a variety of savings opportunities for members, including:

The traditional group buy, which delivers value through voluntary, coordinated, volume-driven purchasing opportunities. Savings average 18 percent beyond Premier’s already low national group purchasing agreement’s pricing.
The EXPRESSbuy, a group buy which offers exclusive, limited-time purchasing opportunities where members access a proprietary Web-based application and purchase needed items immediately. Upfront commitment allows members to achieve additional value. Last year, an EXPRESSbuy on short-dated generic injectables led to up to 93 percent savings for participants.
The newly added PowerBuy also offers exclusive, limited-time purchasing opportunities that provide members an opportunity to aggregate volume across the entire membership to drive deeper discounts. Upfront pre-commitment allows members to achieve extraordinary value.

“With the changes that are occurring in healthcare, hospitals must find ways to safely reduce costs. For our members, there’s truth in the collaborative power of the Premier alliance as it accesses high-value products and services that help them deliver safe and efficient care,” said Durral Gilbert, Premier president of supply chain services. “Alliance members and suppliers alike have seen substantial benefits with our group buy program. Suppliers are able to increase visibility for their products across the alliance, which speeds up and increases sales.”

The savings were identified for the 2,608 members that participated in the program over the past two years. An average of 1,400 members participate in a group buy annually and highly regard the program as a valuable component to achieve additional savings. Successful group buys have included products from lines of business such as cardiovascular, facilities, imaging, pharmacy, medical/surgical, and continuum of care services.

Upcoming group buys include: anesthesia equipment, CPM machines, flooring machines and imaging equipment.

About the Premier healthcare alliance, Malcolm Baldrige National Quality Award recipient

Premier is a performance improvement alliance of more than 2,600 U.S. hospitals and 88,000-plus other sites using the power of collaboration and technology to lead the transformation to coordinated, high-quality, cost-effective care. Owned by hospitals, health systems and other providers, Premier operates a leading healthcare purchasing network with more than $4 billion in annual savings. Premier also maintains the nation's largest clinical, financial and outcomes database with information on 1 in 4 patient discharges. A world leader in delivering measurable improvements in care, Premier works with the Centers for Medicare & Medicaid Services. Headquartered in Charlotte, N.C., Premier also has an office in Washington. https://www.premierinc.com. Stay connected on Facebook, Twitter and YouTube.