A subsidiary of St. Louis-based Ascension Health Alliance has launched a group purchasing organization that system leaders said will help cut supply costs and waste at health care facilities.
"By lowering the overall cost of health care, health ministries will have access to greater resources and will be able to better serve their communities, with special attention to those who are poor and vulnerable," said Scott Caldwell, Ascension Health Alliance senior vice president and chief supply chain officer.
Ascension Health Alliance's St. Louis-based Resource and Supply Management Group runs the newly formed group purchasing organization. The purchasing group is the primary contracting agent for Ascension Health's 34 regional health ministries in 21 states and the District of Columbia (most ministries include multiple hospitals plus other health care facilities). The purchasing group also will take on other clients — health care providers or companies that serve them. They need not be Catholic, and they need not be nonprofit.
The purchasing group will negotiate and manage the contracts of its members, leveraging its purchasing volume to secure lower prices on supplies, medical equipment and some services. Ascension Health Alliance estimates it will spend $4.4 billion in supplies, medical capital equipment and select purchased services in the fiscal year ending June 30.
The Resource and Supply Management Group had been performing many contracting services for its ministries, working with facility-level supply and purchasing managers when it launched the purchasing organization. The new organization will offer more client services than previously had been available. And, Caldwell said, since "contracts are of little value if not implemented effectively and fully," the purchasing organization will monitor purchases and savings over time to ensure that the facilities receive the value they anticipate.
Ascension Health Alliance continues to maintain a relationship with MedAssets, which had been its primary purchasing organization prior to the launch of the new buying group.
Caldwell said system leaders expect that the new purchasing organization will achieve significant savings for its clients. He noted that the savings also will help prepare Ascension Health facilities and the purchasing organization's other clients for the future health care environment. "The formation of our GPO services provides us the flexibility we need to be able to continue to provide for our communities," he said.