Kaleida Health’s Journey to $75M in Savings and Health System Transformation

Sponsored: Premier- May 2024 – The Journal of Healthcare Contracting

Alongside consolidation, consumerism and technology advances, Kaleida Health recognized the opportunity to unlock the value of the supply chain for cost savings, growth and high-quality patient care.

In five years, Kaleida Health recognized more than $75 million* in total savings – all while maintaining quality care and strong clinical outcomes.

Here we outline Kaleida Health’s core strategies in advancing cost, quality and outcomes (CQO) for a future of better, smarter healthcare.

Putting Value Analysis at the Center

A clinically integrated supply chain is a core operational mindset for Kaleida Health. Kaleida Health worked to align organizational goals with its value analysis process and deploy a systemwide, physician-led decision-making structure.

The organization leveraged Premier’s group purchasing organization to manage nonlabor spend and augment existing agreements through the value analysis lens, alongside a dedicated team and actionable data to identify products and services that support CQO improvement.

Integrated, real-time clinical, supply and operational data gave the organization a leg up in achieving systemwide standardization, savings and price parity, with more than $17.7 million* in savings recognized from the value analysis process in 2022.

Value analysis is also at the center of Kaleida Health’s quality initiatives this year, including efforts to reduce CLABSI and CAUTI rates, implementation of a unique enteral feeding connector, and more.

Tackling Purchased Services

For improvement efforts, providers need to tackle areas that historically have been difficult to manage, such as purchased services.

Kaleida Health recognized this imperative and turned to Premier’s purchased services arm to reference services pricing, develop processes to centralize this purchasing and avoid waste, and aggregate spend for best price contract negotiations.

The organization’s optimization of purchased services contract categories drove $1.1 million* in savings in 2023, and 15 initiatives have been identified for 2024, representing a spend of $64 million.

A comprehensive technology platform is also helping Kaleida Health save money and time – surfacing analytics, benchmarks and actionable insights to source competitive contracts and easily measure purchased services usage and spend.

Advancing Clinical Care

With two long-term care facilities, outpatient clinics and home healthcare, Kaleida Health is addressing shifts in site of care through an integrated ambulatory care and physician enterprise strategy – aligning relationships with local providers and expanding its focus on population health. The team will continue efforts to establish clinician standards across the ambulatory enterprise – underpinned by transparent data sharing – to increase efficiency, reduce variation and drive revenue enhancement.

Kaleida Health is also driving quality and safety advancements to enable a systemwide framework for clinical decisions and standardization. The team will look at measuring and analyzing risk-adjusted clinical outcomes, cost, resource utilization and efficiency, and is working towards integrated data sets to help understand cost per case and other drivers to create new value streams.

Based on the transformation work to date, Kaleida Health is well poised for future success – comprehensively tackling CQO improvement that is generating positive results for the supply chain, organization, and communities and patients it serves.

Contact Premier to explore transformational objectives for your organization.

*Data on file. Results may vary based on each provider’s circumstances. Trademarks are the property of their respective owners. Copyright © Premier, Inc., all rights reserved.

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