Incoming Premier CEO Mike Alkire shares how the GPO has evolved during his career, plus how the past 12 months have changed the medical supply chain.
Premier (Charlotte, NC) announced in February that President Mike Alkire will succeed Susan DeVore as CEO and continue to serve as president and a member of the board, effective May 1.
Alkire participated in a Q&A with The Journal of Healthcare Contracting (JHC), covering his 18 years at Premier and the past 12 months of the pandemic. Alkire also answered questions about transitioning to the CEO role and Premier’s trajectory for 2021.
JHC: How have GPOs changed during your 18 years at Premier?
Mike Alkire: The way that Premier has evolved is three-fold: Driving higher-committed contracting strategies that result in best-in-industry pricing; technology-enabling supply chain to drive greater transparency and capture all non-labor spend of a health system; and creating strategies that vertically integrate the supply chain to drive opportunities for domestic manufacturing and reduce our health systems’ dependence on China and other countries controlling certain markets.
Our members are now looking for Premier to aid them in evolving the supply chain away from an isolated, transactional purchasing activity and toward a strategic and technology-enabled, enterprise-wide function capable of helping providers deliver better care, improve outcomes, enable population health strategies and lower costs.
Using robust data analytics, it’s clear that we can increase cost transparency for providers to identify savings and efficiency opportunities. But the most effective partners are those that are providing innovative solutions that set health systems apart in their local markets and enable them to be successful and sustainable into the future.
In addition, it’s now crucial that we stay on top of policy and regulatory developments and marketplace dynamics to help resolve drug shortages, mitigate supply disruptions and optimize purchased services spend, among other activities.
As one example, Premier’s generic drug sourcing program ProvideGx gives members access to more than 150 drugs that are or have been recently designated as shortage drugs – and has successfully protected supply even as demand surged more than 150% during COVID-19.
A unique model in the market, ProvideGx aggregates demand from U.S. hospitals and engages manufacturers in long-term committed buying contracts, providing the surety they need to increase production or move into new markets. We also continue to focus on meeting our members’ personalized needs, including the development of purchased services, oncology and pediatric-specific GPOs.
Further, we are leading the value-based transition from the population health space into supply chain. As the market continues to incent healthcare providers to improve outcomes, suppliers are raising their hands to go at risk with hospitals and guarantee their products’ performance.
And hospitals, for their part, are looking for more value-based contracting opportunities – 95% of integrated delivery networks are interested in and/or ready for these types of contracts, according to a November 2020 Premier survey.
We actively work with our members to develop and deploy a data-driven value-based contracting approach that aligns with their priority needs and organizational goals.
Hospitals and health systems across the nation are also leveraging supply chain and performance improvement technology to drive organizational decision-making, standardize care and eliminate variation. For example, one prominent health system identified $80 million in savings per year over the next five years by minimizing care variability using Premier’s platforms.
This technology is propelling supply chain automation as well, from vendor sourcing and contract management to e-payable capabilities, which are poised to create significant efficiencies and save providers millions.
Alongside the continued evolution of health care, Premier has grown into a service-oriented partner and health care technology and improvement company with our industry-leading portfolio, advanced technology and data platforms, best-in-KLAS consulting team and member-driven collaboratives – delivering cutting-edge solutions for our members and enabling the transformation that drives the industry forward.
JHC: How have the past 12 months changed the trajectory of GPO priorities going forward?
Alkire: I, personally, never want to see another scenario where healthcare providers can’t get access to the vital PPE and supplies needed to protect their frontline workers and care for patients. A primary focus for us has, and will continue to be, ensuring that we have a much more resilient supply chain. That requires innovative strategies and creative partnerships that lower barriers to entry and drive stable supply.
A resilient supply chain would reduce our dependence on China and other countries that have controlled the market in certain categories.
We are leveraging the power of data and ongoing dialogue with our members to drive greater supply diversity and capacity – increasing the production of masks, gloves and other PPE both globally and here at home. For example, when PPE demand surged in the spring of 2020, we identified seven global suppliers to secure 36 million masks and respirators and 16 million gowns from March to May 2020.
Data also informs our approach to domestic manufacturing investments, including those with Prestige Ameritech and DeRoyal Industries Inc., leveraging insights that show supplies most at-risk and where we can scale up to meet member needs. The result was our members managed through the supply shortfalls far better than other hospitals.
The pandemic exposed other significant supply chain gaps, such as availability of supplies for the non-acute space. In June 2020, 83% of alternate site providers reported not having their PPE needs met by traditional med-surg distributors due to allocations.
As a result, we are now thinking more critically about how we ensure product access across the broader health care spectrum – and trusted e-Commerce platforms are serving as a critical channel for providers that cannot consistently order from distributors. Premier’s online healthcare marketplace stockd® has helped meet the need, offering an easy-to-use, accessible platform for providers and other industries to find vetted and reputable products.
Enhancing our AI and predictive technology capabilities is another key focus area. For example, early in the pandemic, we upgraded our technology to overlay predictive modeling with clinical surveillance and supply chain data. This enabled providers to predict caseload surge and model the supplies they would need to handle them. We’re only scratching the surface, and technology and predictive analytics will be even more critical to supply chain operations moving forward.
Greater public-private collaboration is also vital, and Premier will continue to work closely with government stakeholders at the federal, state and local levels to build supply chain resilience. Specifically, we are engaged with the FDA to ensure supply chain transparency, from basic raw materials to finished goods.
We are working with federal and state agencies to dynamically allocate products based on inventory levels and predictive usage patterns to stabilize the need for stockpiling. For U.S. Infrastructure 2.0, we are working with Congress to bring additional domestic manufacturing of PPE and generic drugs to the U.S. where it makes long-term sense. And we will continue to build out our syndromic surveillance capabilities using clinical data sets and natural language processing to interpret unstructured EMR data, flagging certain conditions or disease based on this data.
Our members need high-quality supplies, sourcing and expert supply chain management. They also need to efficiently manage costs, while simultaneously delivering safe and effective patient care or other services.
Across the Premier organization, we are continuously innovating and partnering with our members to meet these goals.
JHC: How does your role as President define your role as incoming CEO?
Alkire: I am so honored and humbled to succeed Susan and look forward to leading Premier and its talented employees during such an important time for the health care industry. Susan’s many accomplishments in her 18 years with Premier have left an indelible mark on healthcare – and I know we’ll continue her legacy of strategic evolution and innovation with a member-focused mindset.
I started with Premier back in 2003 and served as chief operating officer before assuming the role of president in 2019. We’ve been innovating and evolving our Performance Services business, and adding machine learning and AI into our analytics to embed insights into the EMR at the point of care.
Additionally, we’ve launched our direct sourcing subsidiary as well as developed strategies around our Applied Sciences partnerships to target appropriate usage of innovation in both the pharmaceutical and medical device markets. We’ve created collaboratives that have helped our health systems outperform their peers.
This on-the-ground work and collaboration with the Premier team and our members has given me the experience, passion and vision to lead and execute on the future.
As President and now incoming CEO, my dedication remains to propel our pioneering strategies and innovations to drive down pharmaceutical, medical device and supply pricing; technology-enabling and vertically integrating the supply chain; and enabling better patient care and outcomes.
As I told the Premier employees when the CEO transition was announced, our vision, mission and values are strong. What we need to do now is execute and continue to innovate – and that’s where my focus lies.
At this point, I plan to accelerate value delivery to our members and partners. And I intend to do so in three principal ways, largely relying on technology enablement: I want to remove all the waste out of health care (up to 30% of today’s costs). Evidence-based, AI-enabled guidance in workflows will ensure care is appropriate and that clinical, administrative and supply waste is removed.
Modernize and tech-enable the supply chain so that we have efficient automation of manual tasks, as well as visibility, transparency and resiliency baked into the system.
Providing the technologies and expertise necessary to succeed in value-based care, including clinical decision support to ensure the highest quality outcomes demanded by payers, employers and patients alike.
JHC: What initiatives are you energized about for this upcoming year?
Alkire: I’m excited that we have opportunities to leverage our unique data sets, technology and infrastructure to drive down prices of supplies for our members. And I’m particularly excited about, and focused on, our multifaceted technology investments that help our members deliver better care, lower costs and improve patient outcomes.
In today’s health care environment, AI and machine learning are increasingly deployed to automate vital business functions and support complex clinical decision-making.
Premier offers predictive analytics and clinical decision support in real time to serve member needs, ranging from clinical interventions to improving supply chains.
During COVID-19, for instance, we rolled out syndromic surveillance technology that leverages AI and machine learning to track disease symptoms and enable communities to predict hospital utilization, geographic surges and associated resources.
We are working with coalitions of providers in various states to deploy this technology, which will be critical to both our continued management of COVID-19 disease spread as well as streamlining the prior authorization process and improving health system performance overall.
We are also leveraging technology to better align health systems with employers and their health plans. Our subsidiary Contigo Health is focused on increasing engagement with employer health and wellness programs and delivering insights to clinicians through intelligent clinical workflow technology – guiding informed care choices with the latest evidence-based practices.
There is significant opportunity looking ahead for health systems and employers to innovate together in harmony with their health plans.
Lastly, there is more work to be done on shoring up the supply chain and access to PPE and health care supplies. Together with our members, we currently have the two joint ventures under our belts for face masks and isolation gowns to help ensure that critical health care products are insulated from shortages.
Moving forward, we’re planning to address critical supply needs through similar partnerships with members in other product categories.
Overall, this direct-to-manufacturer investment approach is primed for advancement as it supports the delivery of difficult-to-source, high-quality products while improving supply chain efficiencies and transparency.