An inside job? | Outsourcing—clinical and nonclinical—remains a popular option for supply- chain managers, but some systems are bringing services in-house

Source: Jaimy Lee, Modern Healthcare, Vol. 43 no. 35, September 2, 2013
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Hospital systems are taking the cost-reduction lessons they learned with medical devices such as joint implants and are applying them to more obscure and less costly categories of hospital spending. … Hospital systems are taking the cost-reduction lessons they learned with medical devices such as joint implants and are applying them to more obscure and less costly categories of hospital spending on nonclinical products and services.

Some healthcare providers in recent years have started to standardize and better utilize how they purchase services ranging from food catering and clinical engineering to laundry, as well as clinical-care services such as dialysis and clinician staffing. …

… MedAssets, an Alpharetta, Ga.-based group purchasing organization and one of the largest in the industry, has estimated that hospitals spend at least $200 billion on purchased services under local or regional contracts that are not efficiently priced, setting up an opportunity for hospital supply chain teams and outside vendors such as GPOs to get involved….

…Wheaton Franciscan works with its GPO on food contracts and has also centralized its laundry services and printing operations. It continues to manage its courier fleet internally after reviewing the costs and risks of outsourcing it. …

…Meanwhile, Sanford Health, a 23-hospital system based in Sioux Falls, S.D., manages a range of nonclinical purchased services such as elevator maintenance and housekeeping, as well as clinical-care services such as temporary physician and nurse staffing.

Sanford is now applying the same methods it has used to reduce the costs of medical supplies to a broad range of nonclinical service categories. In some of these areas, Sanford is reaping cost reductions up to 20%, says Tom Harvieux, the system’s vice president of supply chain management. Over the past year, Harvieux says Sanford is now relying less on outsourced services contractors and is bringing more of its purchased services contracts in-house. …