VHA Expansion

Purchases – and savings – are up for VHA customers as the GPO continues to add to its portfolio of services.

VHA Inc. delivered more than $1.4 billion in savings and value to its member healthcare organizations through its supply chain management programs in 2006, the Irving, Texas-based organization reported at its recent Leadership Conference in Denver. In addition, VHA reported that its clinical programs helped members improve care for the 10 million patients who are treated at their hospitals every year.

Last year, VHA members purchased $22.9 billion in supplies and services using contracts negotiated by Novation ($20.8 billion) and VHA ($2.1 billion) – a 6 percent increase over 2005. Alliance members reportedly saved $994.3 million through their participation in VHA’s network and supply chain services in 2006, according to the organization. Also in 2006:

  • VHA’s revenue jumped 10 percent, from $502.6 million to $555 million.
  • Operating income increased 28 percent, from $220.1 million to $280.9 million.
  • Cash distributions to members increased 7 percent, from $388.6 million to $416.3 million.

VHA President and CEO Curt Nonomaque reported that the organization is expanding its clinical agenda “to help members accelerate performance improvement efforts.” VHA reports that it promotes the formation of member networks that allow hospitals to work together to address clinical challenges, such as heart care, operating room efficiency and medication safety. For example, 31 hospitals in Maryland, North Carolina, South Carolina, Tennessee, Virginia, West Virginia and Washington D.C., joined a VHA initiative to help its members implement Rapid Response Teams – hospital teams that provide immediate assistance to help prevent patients in medical-surgical units from spiraling toward a crisis, such as cardiac arrest or shock. At least 68 percent of the hospitals decreased their mortality rates and experienced 256 fewer code-blue episodes (incidents when the patient stops breathing) outside of the intensive care unit.

New technology catalog
In other developments, Novation (which provides contracting services for VHA as well as the University HealthSystem Consortium) compiled the third edition of its New Medical Technology Catalog. The annual catalog showcases innovative medical products that are available through Novation contracts. Products must provide documented incremental patient care and safety (for patients or healthcare workers), according to Novation. Suppliers featured in the 2007 catalog include 3M, Alliance Tech Medical, Aspect Medical Systems, Buffalo Filter, Cardinal Health, Cook Medical, Dade Behring, DiaSorin, Eastman Kodak Company, ev3, Exergen Corp., Georgia-Pacific Corp., Healthpoint Ltd, Hollister Inc., Hospira Worldwide Inc., IRIS Diagnostics, Jeron Electronic Systems, Kimberly-Clark, LUXTEC,

MDM Commercial Enterprises, Medline Industries, Molnlycke, Natus Medical Inc., Roche, Sage Products, Siemens Medical, SizeWise Rentals LLC, Spacelabs Healthcare, SPSmedical and Stryker.

Disaster preparedness tool
To help hospitals prepare for disasters, Novation released a Disaster Supply Needs Assessment Tool, which calculates supplies needed on-hand based on bed count and/or surge capacity to care for patients for one week. The company also created a Disaster Preparation Resource Guide, which provides resources to assist members in preparing to treat patient and protect healthcare workers in the event of a disaster.

The tools come on the heels of a Novation survey regarding hospitals’ preparedness for a global flu pandemic. Of 303 materials managers surveyed, 68 responded. The results show that while 68 percent of the hospitals surveyed reported that they have devoted resources to developing comprehensive pandemic-specific disaster plans, 79 percent of them reported that they could continue operations without external resources for less than one week. Fifty-four percent said that operations could continue for one to three days, and 25 percent said they would be able to operate between four and seven days without external resources.

The majority of respondents (93 percent) have identified key products and suppliers that they deem essential to providing treatment to patients during a pandemic. Two-thirds said they have created collaborative plans with other hospitals as well as their distributors. In addition, more than half of respondents 1) have provided for automatic delivery of products and supplies upon notification of an outbreak, 2) have the ability to manage critical business functions through an alternate location, and 3) are able to support existing business functions with limited staffing through cross training/skills development. Other findings include:

  • More than half of respondents (60 percent) have a dedicated/ separate inventory of key products and supplies with an increased production of these key products and supplies.
  • Nearly one third (31 percent) have preprinted disaster preparedness order forms.
  • More than three-quarters (78 percent) of respondents have plans in place to obtain additional respirators. Some hospitals (39 percent) plan to purchase them, while others (22 percent) plan to rent them. Another 39 percent said they will purchase and rent additional respirators.
  • More than half (60 percent) of respondents said their organization has designated a specific job title that only functions as the key lead role in disaster preparedness. Examples of job titles for this role include director of materials management, emergency preparedness director and committee, infection control coordinator and director of nursing.

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