Hospitals and other healthcare facilities face rising pressures to provide the highest quality care to a growing number of patients but with an ever-diminishing budget from both private and public sector payers. This shift was made even more prominent following the implementation of the Patient Protection and Affordable Care Act. Everyone in health care now carries the banner of doing more with less. Only, how do you turn phrasing into action?
The Rise of Group Purchasing Organizations
One of the biggest expenses healthcare providers have is in new and ongoing medical equipment purchases. Group Purchasing Organizations have long been effective bandage cures to expensive equipment and supplies costs. With these GPOs, multiple hospitals and healthcare facilities pool their resources into a more powerful negotiating and buying power they can then leverage at a directed manufacturer.
This enables groups to purchase more of the best drugs, supplies, and medical equipment they need. In fact, GPOs are so successful that currently 72 percent of hospital purchases are done using GPO contracts to save hospitals as much as $33 billion every year via reduced product prices.
Along with the traditional GPO’s, there is also a rise in regional and provider-led GPO’s that are more product committed and drive down prices even lower.
The Purchase Order and Receiving Costs
While GPOs are an effective way to get lower group purchasing rates for medical supplies and products direct from the manufacturer, there is still the thorn of purchase order costs. GPOs negotiate contracts for healthcare facilities, but they aren't a supplier or delivery company. So while the manufacturer might offer a lower product cost point, there are still the costs associated with ordering, delivering, and clean-up.
For example, if you're undergoing a new construction or remodel, you're looking to outfit whole rooms, floors, and wings. For just one exam room, you might need medical equipment from around twenty different manufacturers, and even if you have GPO contracts with each of these manufacturers, you'll still need to fill out separate POs for each one. POs cost a healthcare facility between $75 to $125 each, a white paper cost that can quickly add up.
Besides the administrative costs of issuing the PO, there are also costs involved in receiving the products. Ordering from multiple manufacturers has the other expensive drawback of multiple deliveries. This further adds up the excess fees with labor costs for staggered assembly and disposal of packing materials.
Consolidate it All
At CME, we understand your need to keep prices low. That's why we've stepped in to be the medium capable of providing both the benefits of GPOs with the reduction of multiple POs and deliveries. Our group has contract agreements with all of the major GPOs, enabling us to give our customers the best rates on medical equipment and supplies. But our main specialty is in providing the logistics help in getting the medical equipment to hospitals and healthcare facilities.
With our white glove service, you can consolidate all of the many POs from different departments for different items sourced by different manufacturers all in one easy (and inexpensive) order. This significantly reduces your PO costs, plus when added with our direct-to-site delivery service, we'll collect all of your ordered equipment at our warehouse. Once every piece has been accounted for and assembled, we'll organize with your group for one quick and efficient delivery date.
This streamlined service enables you to significantly save on the costs associated with delivery and labor (not to mention workflow interruptions). Our technicians will assemble the equipment and arrange for training, if desired, of your staff members on the use of unfamiliar items. Once the job has been completed and a manager from your facility has signed off on the order, all of the packaging trash will be disposed of by CME associates.
To learn more, contact us today.
With two corporate offices and 35+ service centers, our mission is is to help healthcare facilities nationwide reduce the cost of the equipment they purchase, make their equipment specification, delivery, installation, and maintenance processes more efficient, and help them seamlessly launch, renovate and expand on schedule.