How a GPO can cut medical and supply costs

April 12, 2017 by Medigroup

Health care institutions from hospitals to local doctor’s offices require a significant amount of supplies to deliver quality treatment. ​Items like disposable gloves, bandages and gauze go quickly within these facilities, and it can be difficult to keep up with inventory needs, particularly for smaller groups or ones operating on a tight budget. A group purchasing organization can help you cut medical and supply costs while ensuring you have the necessary equipment to support your operations.

Better contract negotiations

Many health care institutions are so busy that they don’t regularly review their contracts. This could mean missing out on critical deals and lower prices for supplies. A GPO is adept at negotiating buik contracts and restructuring old agreements to be more beneficial to an organization’s bottom line, Becker’s ASC Review stated. Partnering with a GPO can save health care groups anywhere from 7 to 15 percent on costs for materials through better contract negotiations. It you simply don’t have the time to review your contract or the budget to continue supporting it, join a GPO to lower expenses and better track the prices of supplies.

GPOs can help negotiate a better contract for your supplies.

Innovative business analytics

GPOs are becoming more multifaceted as health provider and patient needs shift. Medical institutions are looking to GPOs for education on how products and equipment under contract should be best utilized, improving optimization and further saving on operational and procurement costs. In a report by the Healthcare Supply Chain Association, HSCA president and CEO Todd Ebert noted that GPOs are now offering data analysis, innovative technology integration, product tracing and more to accurately monitor activity and lead to informed decision-making. With innovative business intelligence tools and supply chain professional education from a GPO, an expanding health system was able to save $10 million.

“GPO partners can stay up-to-date on regulatory issues.”

Ensuring compliance

Within the health care industry, compliance to federal and sector regulations is critical to providing quality patient treatment. For instance, vaccines and medications must be delivered and stored in the right conditions to ensure effectiveness. GPOs are go-betweens for individual members, suppliers and regulatory bodies, and must ensure that all essential information is communicated effectively. As a result, GPO partners can stay up​ to date on regulatory issues and adjust strategies to ensure that they are in compliance with the latest standards. This will be essential to avoiding heavy compliance fines and administering quality care to every patient.

Health care organizations are under a lot of pressure to keep track of necessary supplies while staying within budget, but this can be difficult when considering how often certain items like gloves are used. GPOs can help medical groups cuts costs by renegotiating contracts for a better deal, optimizing product utilization and ensuring that compliance requirements are adhered to. If you’re not already paired with a GPO, consider joining one today to reap these considerable savings benefits. For more information on how a GPO can supply your health care organization at lower cost, contact MediGroup today.