Healthcare Industry News:  Premier healthcare alliance 

Devices Group Purchasing

 News Release - April 21, 2008

Premier Healthcare Alliance Adds New Members with $1.1 Billion in Purchasing Volume in 2007

Leading Group Purchasing Organization Retention Rate Continues to Top 98 Percent

CHARLOTTE, N.C.--(HSMN NewsFeed)--The Premier healthcare alliance today announced it recorded new business exceeding an estimated $1.1 billion in group purchasing volume from the addition of 88 new alliance member not-for-profit hospitals in 2007. At the same time, Premier also announced that its member retention rate continues to exceed 98 percent, well above the industry average.

Since 2005, Premier has generated more than $2.4 billion in new business volume while adding 216 hospitals. Premier estimated supply spend from its new members exceeded $2.3 billion in 2007 and has topped $4.8 billion since 2005.

Carteret General Hospital, which joined Premier from MedAssets in 2007, expects to save more than $1 million in its first year because of the change. Director of Materials Management Steve Broughton said, “Premier is delivering as promised. This is a good win for us. Quite frankly, I’m astounded at the savings we’re seeing.”

John C. Lincoln Health Network in North Phoenix, Ariz., joined Premier in 2007 from both Broadlane and Amerinet. At the time, President and CEO Dan Coleman said, “To maximize our ability to care for our community, we must operate as efficiently as possible. Premier will help us to achieve greater operational efficiency."

Premier Purchasing Partners President Mike Alkire said, “The addition of 88 hospitals and exceptional retention rates corroborate the value of the Premier healthcare alliance to our members. We are confident our success is directly attributable to the fact that we see our roles as a transparent partnership with our members whereby we can drive true value through aligned incentives.”

“The healthcare group purchasing industry is saturated,” Alkire noted. As many as 98 percent of all hospitals and health systems use at least one group purchasing organization (GPO) “and there is relatively little movement from one GPO to another. We firmly believe our commitment to and partnership with not-for-profit hospitals is fundamental to our continued growth. Our full commitment is to our members; as we are successful so are these not-for-profit hospitals.”

The Premier healthcare alliance recently announced that it returned a record $900 million in cash distributions and member-validated savings to its owner not-for-profit hospitals and healthcare systems in 2007, helping those owners to serve their communities better. Cash distributions of total GPO revenue are substantially higher than distributions by other GPOs.

Susan DeVore, Premier’s chief operating officer, believes there is more than just financial value driving Premier’s success. “Our ability to leverage our informatics data puts Premier in a separate league,” she said. “We have the largest clinical comparative database in the industry and we use that robust information to drive quality improvement and service line profitability. Yes, we deliver unparalleled financial value but we believe cost and quality are inseparable; our alliance members value our focus on both.”

The group purchasing network now includes nearly 1,600 hospitals and almost 50,000 other healthcare sites, such as surgery centers and long term care facilities. Many of these hospitals have come together in regional collaboratives under the Premier umbrella to drive even greater savings, especially for smaller, independent hospitals.

About Premier Inc., 2006 Malcolm Baldrige National Quality Award recipient

Serving more than 2,000 U.S. hospitals and nearly 50,000 other healthcare sites, the Premier healthcare alliance and its members are transforming healthcare together. Owned by not-for-profit hospitals, Premier operates one of the leading healthcare purchasing networks and the nation's most comprehensive repository of hospital clinical and financial information. A subsidiary operates one of the nation's largest policy-holder owned, hospital professional liability risk-retention groups. A world leader in helping healthcare providers deliver dramatic improvements in care, Premier is working with the United Kingdom's National Health Service North West and the Centers for Medicare and Medicaid Services to improve hospital performance. Headquartered in San Diego, Premier has offices in Charlotte, N.C., Philadelphia and Washington. For more information, visit www.premierinc.com.


Source: Premier Purchasing

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