‘The price at the pump is just the start,’ says VP Brenda Peterson
In September 2017, the Upper Midwest Consolidated Services Center, a regional purchasing coalition, with headquarters in Minnesota, changed its name to Captis, which comes from the Latin word meaning “to influence,” “to hold the attention of,” “to captivate.” Given the RPC’s growth from its founding in 2008, the name makes sense.
That’s because in 2008, Captis comprised just 10 health systems; by 2011, it had grown to 34; and today, 85 members generate an annual purchasing volume exceeding $9 billion. And it no longer is just an Upper Midwest affair. Captis has members in 26 states, from California to New York to Florida. And things continue to change. In fact, Captis has given a name to its change initiative – Captis 2.0.
That said, a couple of things have remained constant. For example, the RPC is managed – as it has been since 2008 – by Vizient. And, just as it did in 2008, Mayo Clinic, a founding member of Captis, provides sourcing and contracting services.
Contracting is key
Vice President and General Manager Brenda Peterson began her healthcare career in nursing, and managed the startup of a home infusion therapy service line for a national DME company in the Twin Cities. She received an MBA with a specialization in healthcare from the University of St. Thomas in 1995. For nine years she served on the board of a local community hospital, which she regards as an important career experience. She joined VHA (now part of Vizient) in 1998, and stepped into the company’s Upper Midwest region in the mid 2000s. In 2007, she found herself working with a team on the creation of an RPC. “We worked on it for nine months – at least,” she recalls.
Contracting remains a core part of Captis’ mission. Captis members are involved throughout the sourcing and contracting cycle and ultimately approve every contract contained in the Captis portfolio, explains Peterson. Six functional bodies are in place for decision-making, including the Board of Managers, Business Development Committee, Clinical Committee, Finance Committee, Operations Committee and Pharmacy Council. Each plays a crucial role in the Captis structure and governance.
Captis manages 300 contracts, which cover about 95 percent of its members’ needs in commodities, and clinician- and physician-preference items. The RPC pursues primarily suppliers who have been awarded a national contract with Vizient. “We have gotten creative in the past few years addressing supply chain issues unique to regional pockets of our members,” says Peterson. “So far, we haven’t met a challenge we haven’t been able to overcome.
“Our mature processes include information-gathering and analysis by a team of analysts dedicated to Captis,” she continues. “In addition, we enlist the Mayo Clinic Clinical Quality Value Analysis team for the clinical review of products, and also assemble physicians and subject matter experts to serve as champions or advisory panelists/council members. Providers across our 26 states also provide clinical feedback to our sourcing and contracting team. All of the information gathered from our stakeholders is collated and defines the contracting strategy we ultimately bring to market.”
In 2014 Captis’ board of managers approved Captis 2.0, a program designed to deliver value beyond sourcing and contracting.
“Captis members know that the price at the pump is just the start,” says Peterson. “Ultimately, it’s about utilization.”
The mission of Captis 2.0 includes:
- Achieving improvements collaboratively that are improbable when systems act alone.
- Evaluating product and service consumption.
- Operating activities previously performed by suppliers and members.
- Pursuing value of all kinds (cost savings, utilization savings, clinical enhancements, growth enablement, capital allocation and funding, revenue enhancement, etc.)
“These programs include clinical leading practices, utilization, standardization, supply chain efficiency enhancement and innovation as well as pharmacy cost reduction,” she says. “Program ideas receive rigorous evaluation by the Captis Business Development Committee, other committees and the program management office.”
In 2018 alone, Captis 2.0 programs generated $53.7 million in savings and more than $5.4 million in program revenue.
A blood management program, for example, was created to align Captis members’ clinical behavior with protocols supported by evidence-based national blood standards. The goal is to reduce usage and complication rates.
In 2017, the Captis Custom Procedure Tray program embarked on a mission to reduce the number of components used, and to increase consistency across the Captis membership. With the support of the Mayo Clinic Quality Value Analysis (CQVA) Team, 281 components were reviewed on behalf of the membership and formulary products identified. Over the course of the year, Captis, its members and its CPT supplier reduced by 34 percent the number of unique components used, and garnered an associated $500,000 in member savings.
In another project, the Pharmacy Council and Finance Committee revised the billing methodology and reduced pharmacy program fees for 88 percent of Captis members. Two cost-avoidance initiatives were identified, formulary products were instituted and utilization was managed, and helped Captis members avoid more than $10 million in drug costs.
Virtual item master
Captis reveal™ is a data-sharing resource developed with aptitude LLC, which allows contracted suppliers to see their market share in a monthly updated, web-based app, at the SKU level, and by each member. In addition, suppliers can see their competitors’ market shares. In other words, the data-sharing “reveals” the total product market, by item, by each individual member, and by respective share. It includes each facility’s consumption patterns by the same criteria. Members can use the same information to identify opportunities for additional savings through contract optimization.
In February 2019, Captis members chose Vizient to create a centralized and automated item master tool for a supply chain innovation program. The virtual item master will contain item description data and the associated information for all items in inventory. This creates a common dictionary and data repository for all members, allowing translation from the Captis item master to their local systems. After the item master is intact, additional capabilities, such as inventory management, will be vetted. This could include visibility into inventory levels among network members.
Captis has several strategic initiatives underway:
- Continue to grow membership with a focus on cultural fit while allowing flexibility and choice of membership type.
- Increased participation in the Captis portfolio.
- Identification of new programs, alternative membership options and new revenue models.
Says Peterson, “We will continue to deliver value across the membership through the expansion of our portfolio, cost/savings improvement, and reduction of waste through utilization, standardization, increased clinical effectiveness and operational efficiency.”