CHARLOTTE, N.C.--()--Newly merged Cadence Health saved $4.4 million in one year by integrating its purchasing strategies with the Premier healthcare alliance.
“I think the overall feeling was that they were not getting the value that they hoped they would from their incumbent GPO. We overwhelmingly voted to switch to Premier.”
Illinois health systems Central DuPage Health System in Winfield and Delnor Community Health System in Geneva merged in spring 2011 to form Cadence Health. As part of the merger, Delnor switched to Premier to consolidate the new health system’s purchasing activities. Delnor previously used VHA-Novation as its group purchasing organization, but Central DuPage was already a Premier alliance member.
“Delnor embraced the change,” said David R. Valestin, senior director, corporate supply chain at Cadence Health. “I think the overall feeling was that they were not getting the value that they hoped they would from their incumbent GPO. We overwhelmingly voted to switch to Premier.”
For Delnor, a 159-bed hospital, the conversion savings alone represented just under $1 million.
“Other than price, our reason for staying with Premier and converting Delnor was Premier’s total value of people, resources and tools to help us do our jobs and provide the best contracts for our patient caregivers. Premier and Cadence have partnered to meet our supply chain cost reduction goals. Our teams work collaboratively to optimize the Premier portfolio, benchmark non-contracted supply pricing and identify potential utilization opportunities,” said Valestin.
Cadence Health is a member of the Premier alliance’s national and regional supply chain collaboratives, including ASCEND® (Accelerated Supply Chain Endeavor), which has delivered more than $560,000 in cost savings to the health system leveraging a committed spend of more than $5.5 billion.
“Overall the ASCEND program has helped, especially with our new system, to show our clinical folks the total value of Premier,” Valestin explained.
IPC Group Purchasing, a regional collaborative involving the Illinois Hospital Association, healthcare providers and Premier, also has created additional value for Cadence Health. Premier alliance members in Illinois as well as a system in Indiana and a hospital in Michigan benefit from aggregating and standardizing as a group.
With 2,800 – or nearly half - of the country’s acute-care hospitals and 90,000 non-acute care sites, Premier focuses the power of collaboration at a national scale. Alliance members make up the largest aggregation of hospital group purchasing, uniting providers to deliver the highest quality and most cost-effective care to patients.
Complementing its purchasing efforts, Cadence Health uses SpendAdvisor®, a spend management decision support app on Premier’s integrated technology platform PremierConnect™. Premier apps examine spend data, identify savings opportunities and disseminate best practices. The platform houses the nation’s largest outcomes database with information on 1 in 4 U.S. hospital discharges, from 2.5 million real-time clinical transactions daily and roughly $40 billion in annual purchases.
About Cadence Health
Cadence Health, formed by a March 2011 merger of Central DuPage Health System, Winfield, Ill., and Delnor Community Health System, Geneva, Ill., serves more than 1 million patients in Chicago's western suburbs. Employing more than 6,100 professionals, Cadence Health services include primary care (physician practices and convenient care centers), occupational health, cancer treatment, senior living, home health and hospice care. www.cadencehealth.org
About the Premier healthcare alliance, Malcolm Baldrige National Quality Award recipient
Premier is the nation’s largest performance improvement alliance of more than 2,800 U.S. hospitals and 90,000 other sites using the power of collaboration and technology to lead the transformation to coordinated, high-quality, cost-effective care. Owned by healthcare providers, Premier operates a leading purchasing network with nearly $5 billion in annual savings. Premier also maintains clinical, financial and outcomes databases based on 1 in every 4 patient discharges. A world leader in measurably improving patient care, Premier has the largest performance improvement collaboratives in America, including one in partnership with the Centers for Medicare & Medicaid Services. Headquartered in Charlotte, N.C., Premier also has an office in Washington. https://www.premierinc.com. Stay connected with Premier on Facebook, Twitter and YouTube.
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