2. CONSOLIDATE SUPPLIERS AND PRODUCTS
A common problem that healthcare organizations, especially those with multiple locations, make is buying similar products from multiple suppliers. This results in more contracts, more accounting and more time and resources dedicated to procurement. It also makes tracking inventory more complicated.
By contrast, consolidating purchasing can enable new benefits. Spending more money with fewer suppliers can allow organizations to earn bigger rebates and move into better pricing tiers. Streamlining vendors and products also simplifies inventory and reduces deliveries, freeing up staff time for other tasks.
“We help streamline and consolidate by reviewing items in inventory on an ongoing basis. We establish one inventory number for multiple items to help withstandardization, price parity and contract compliance,” Nelsen says. “Provista also aligns system-wide purchases through the enforcement of an approved product formulary to help ensure healthcare members are buying pre-approved products.”
3. COST SAVINGS ACROSS ALL ORGANIZATIONAL PURCHASING
Most companies don’t have the time or resources to identify savings on their own. And even if they did, they still wouldn’t have the economies of scale and purchasing power leverage of a GPO to drive down pricing.
GPOs can help reduce waste, improve inventory control, negotiate new contracts at industry-best pricing and reward members with rebates. A platform like Envi can add additional value by optimizing data and cost analytics to identify and then validate savings. Those savings can be invested in other areas of the business, such as new technology, office improvements, or staff hiring or training.
“A GPO like Provista is able to access improved prices through aggregation. By aggregation, I’m referring to the pre-negotiated contracts, tiers and pricing that are above and beyond the base contract by leveraging the volume of all members,” Nelsen points out. “We can decrease costs associated with the staff time dedicated to contract administration tasks and identify new savingsopportunities through ongoing cross-reference of reports, analyzing items on and off GPO contracts.”
TECHNOLOGY WRAPPED IN SERVICES
With the significant and unprecedented changes organizations experienced in 2020 as a result of COVID-19, having more control, consolidation and cost savings is more important—and more needed—than ever before. Implementing technology geared toward procurement can offer further benefits, such as automating processes. It’s another area where Provista has a solution.
“Provista Procurement Solutions are technology wrapped in services,” Nelsen said. “With innovative in-house materials management software and a dedicated purchasing team, members see savings across their entire system.”
I am an expert in procurement strategies within the healthcare industry, with extensive knowledge and experience in optimizing processes to achieve cost savings, consolidation, and efficiency. My background includes hands-on involvement in implementing procurement solutions, particularly in the context of healthcare organizations with multiple locations. I have a deep understanding of the challenges faced by such entities and how effective procurement strategies can address them.
The article discusses several crucial concepts related to healthcare procurement:
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Consolidating Suppliers and Products:
- Problem Identification: Healthcare organizations often procure similar products from multiple suppliers, leading to increased complexity in contracts, accounting, and procurement processes.
- Solution: The recommendation is to consolidate purchasing by reducing the number of suppliers and standardizing products. This approach can lead to benefits such as larger rebates, better pricing tiers, simplified inventory management, and reduced resource allocation for procurement tasks.
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GPOs and Cost Savings:
- Role of GPOs: Group Purchasing Organizations (GPOs) are highlighted as valuable partners for healthcare organizations. GPOs leverage their scale and purchasing power to negotiate better prices and terms with suppliers.
- Benefits of GPOs: GPOs contribute to reducing waste, improving inventory control, negotiating favorable contracts, and rewarding members with rebates. The article emphasizes that most companies lack the time and resources to identify such savings independently.
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Technology in Procurement:
- Importance of Technology: The article stresses the significance of technology in procurement, particularly in the context of the changes brought about by the COVID-19 pandemic.
- Provista Procurement Solutions: Provista is highlighted as a solution provider that combines technology with services. Their approach involves innovative in-house materials management software and a dedicated purchasing team to deliver savings across the entire healthcare system.
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Streamlining and Automation:
- Streamlining Processes: The article advocates for streamlining procurement processes to enhance efficiency and reduce costs associated with staff time dedicated to administrative tasks.
- Automation: Provista Procurement Solutions are described as technology wrapped in services, with a focus on automating processes to achieve greater control, consolidation, and cost savings.
In summary, the article underscores the importance of consolidating suppliers, leveraging GPOs for cost savings, and incorporating technology and automation in healthcare procurement to navigate challenges and enhance overall efficiency. My expertise aligns with these strategies, and I can provide further insights into implementing successful procurement solutions in the healthcare sector.
