New Initiative Expected to Deliver Nearly $5 Million in Annual Savings on Implants and Implantable Devices While Preserving Physician Choice
ATLANTA--(BUSINESS WIRE)-- As part of a systemwide effort to reduce the acquisition costs of implants and implantable devices for total joint, spine and trauma procedures, UC Health, a Cincinnati-based regional leader in healthcare, has successfully completed the first quarter of its engagement with MedAssets Clinical Cost Management Consulting services to address Physician Preference Items (PPI). UC Health joins a growing list of healthcare organizations to realize immediate benefit from review of purchasing practices for items that account for a significant portion of supply expense. Based upon the quarterly results of the PPI initiative, UC Health expects to realize nearly $5 million in annual savings or approximately 25 percent of its orthopedic PPI spend.
“MedAssets is a data-driven organization. Building on its considerable expertise in conducting PPI initiatives of similar scope and complexity, Med Assets collaborated with UC Health to help drive this change process,” said Dennis Robb, senior vice president, Business Operations and Chief Supply Chain Officer, for UC Health.
Medical Implants and Devices – Typically 40 percent of the Supply Budget
Supplies and drugs represent 25 percent of a typical hospital’s operating budget, and about 40 percent of the supply budget is spent on physician preference items. The goal of UC Health’s total joint, spine and trauma project is reducing acquisition costs of supplies for procedures in these areas, while preserving physician choice from a roster of multiple vendors.
Physician Collaboration and Purchasing Practice Data Key to Success
As part of the consulting process, MedAssets and UC Health worked together to analyze existing purchasing practices and prices for implantable devices related to total joint, spine and trauma categories. The MedAssets team collaborated with UC Health physicians to place products in logical categories for comparison, evaluate current pricing for products from vendors in each of these categories, and benchmark against aggregate data benchmarks to highlight fair market value for each product category.
“As a result of this initiative with MedAssets, we have gained very competitive market pricing based on a like-to-like formulary of products purchased from 23 suppliers,” Robb said. “Working with our surgeons, administrators, contracting team and Med Assets has produced an extraordinary outcome. When we engage in an initiative such as PPI Consulting, we can lower our hospital expense and serve our community by passing savings on to our patients,” he added.
The current PPI initiative represents just one component of UC Health’s longstanding relationship with MedAssets, in which MedAssets provides a comprehensive, outsourced supply chain management solution. “Our work with UC Health demonstrates that innovative tools and solutions are helping optimize overall supply chain performance while maintaining the highest quality standards,” said Rand Ballard, senior executive vice president, chief operating officer and chief customer officer, MedAssets. “We are gratified that our commitment to cost-reduction initiatives is helping our long-time client expand its leadership in contract compliance and purchasing efficiency, and most important, deliver significant value and quality of care to the community it serves.”
About UC Health
UC Health brings together the region’s top clinicians and researchers to provide world-class care to its community. From the flagship University Hospital, ranked as the best hospital in the region by US News and World Report, to its state-of-the-art West Chester Hospital and Drake Center, Cincinnati’s premier provider of specialized and rehabilitative care, UC Health delivers the absolute best in treatment and care. Continually recognized for excellence and backed by the academic strength of the University of Cincinnati, one of the nation’s top 25 public research universities, UC Health is revolutionizing how discovery-driven care is delivered. For more information, go to www.uchealth.com.
About MedAssets
MedAssets (NASDAQ: MDAS) partners with healthcare providers to improve their financial strength by implementing revenue cycle, spend and clinical resource management solutions that help capture revenue, control cost, improve margins and cash flow, increase regulatory compliance, and optimize operational efficiency. MedAssets serves more than 180 health systems, 4,000 hospitals and 90,000 non-acute healthcare providers. The company currently manages $45 billion in supply spend and touches over $316 billion in total patient revenue annually through its revenue cycle solutions. For more information, go to www.medassets.com.
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