Healthcare Financial Management Association. Premier Health Partners & Scorpion Data Security May 17, 2011. Supply Chain Division Who are we?. Purchase for all five hospitals Sourcing Managers Negotiate with the > 4,100 suppliers Procurement – Buying the product to Truck Delivery
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Premier Health Partners & Scorpion Data Security
May 17, 2011
Purchase for all five hospitals
Negotiate with the > 4,100 suppliers
Procurement – Buying the product to Truck Delivery
Coordinate the: ~335 orders per day ~$540 M per year
Control the ~ 84,000 supply items
Laundry plant - >900 bags per day
Capital Acquisition –
Purchase capital equipment
Supply Management Information – Contract, rebates
Control the > 1,500 contracts
Salary and Benefits 52%
Supplies+ Purchased Services 35%
Bad Debt, Interest Exp, Tax 6%
TOTAL $1.7 Billion
2011 PHP Budget
Sourcing purpose / business foundation:
The reduction of cost from the prior average 12 month spend that result in a net expense decrease to the P&L statement.
Actions taken by Sourcing personnel that prevent increased expense from hitting the P&L for PHP.
Premier Health Partners Pricing Strategy
PHP strives to be in the lower quartile (<25%) on all supply costs and vendor contracts.
How we achieve our goal:
Price Lynx Data Base
VHA Group Purchasing Affiliation
Midwest Purchasing Coalition with Ohio Health and Community Health
Supply Chain Organizational Assessment - Infrastructure
Staying ahead of the vendors sales strategy
Cultivate highly trained / skilled sourcing personnel
Need to possess greater specialized skills
Technology – higher cost of healthcare
Surgery – Skeletal hardware (spine, joint, etc.), neuro,
Equipment – DiVinci robot, Cardiology cath labs, 3-D, 4-D, patient beds.
Supplies – MRI compatible stents, Silver coated catheters
Medical Device Tax (2.3% of Revenues)
Drug Shortages – 200 scarce meds (2010) vs. 56 (2006)
Price Point and Utilization - ‘Total cost per discharge.’ It will determine a large part of the hospitals margin.
The Future of Information Management and Document Destruction
Remember, there is a big difference between a personal win and a business result
Eric T. Joiner
Vice President, Chief Purchasing Officer