Collaboration in physician preference items (PPI) saves hospitals & communities

HealthTrust’s Medical Device Management (MDM) team offers consulting, analytics and custom contracting to assist data-driven decision-making, resulting in optimal outcomes and cost savings.

The team continuously reviews technologies, clinical evidence and market trends to negotiate the best contracts and navigate issues while engaging physicians in decision-making.

Jimmy Yancey

MDM looks at the big picture for PPI. “For high-value implants, we are looking at all the factors—physician alignment, market share, total spend, regional considerations—and creating a custom strategy to improve supply costs, maximize and maintain savings, and reduce unnecessary variation,” says Jimmy Yancey, AVP, Medical Device Management for HealthTrust. The team then works with a health system to develop a personalized strategy.

Community Hospital Corporation (CHC), benefited greatly from its relationship with the MDM team. A not-for-profit organization based in Texas, CHC has owned, managed and consulted with hospitals for more than 25 years. With the goal of guiding and enhancing the mission of community and rural hospitals, CHC supports 130 hospitals ranging in size from 25 to 500 beds.

Ann LaFemina

In terms of purchasing power and staffing, rural hospitals face challenges that their urban counterparts—even those of equal service volume—may not. Such hospitals may rely heavily on the support of local supplier representatives, says Ann LaFemina, former Senior Director, Medical Device Management for HealthTrust. Access to supplier reps who live close by to assist in procedures and provide device checks may be of greater importance for smaller, rural hospitals than it is for a large metropolitan hospital with a variety of suppliers close at hand. CHC provides the support and attention that smaller hospitals require, and the MDM team adds its contracting expertise, subject matter experts and reach.

LaFemina, who worked with CHC closely, having led the initiatives for their cardiovascular products, shares, “We are able  to set ourselves apart from our competitors with speed to market, based on business intelligence as well as our vendor relationships at the national level.”

A helpful partnership

CHC sees its primary mission as ensuring that smaller hospitals remain viable. “We do that by improving cost savings through the HealthTrust portfolio, optimizing those contracts and then trying to drive any other efficiencies we can for those hospitals,” says Jon Pruitt, SVP, CHC Supply Trust.

Jon Pruitt

CHC completed a cost-savings engagement with the HealthTrust MDM team to secure new contracts with medical suppliers in the cardiology space, including Boston Scientific, Medtronic, Abbott and Biotronic, for a host of products such as stents, balloons, guide wires and cardiac rhythm management devices. “HealthTrust has been able to provide significant savings for our hospitals through those contracts,” says Pruitt.

The hardships of the pandemic hit the entire healthcare industry heavily. And rural hospitals, which don’t always have the purchasing power of their larger metropolitan peers, despite providing about 20% of the medical care in the country, got hit especially hard.

The impact of a rural hospital struggling or closing is also different from the impact of a hospital struggling in a large city. While a closed hospital in either setting means added difficulty accessing care, for those in low-population areas, closures can mean that necessary healthcare is hours away. Additionally, hospitals closed mean jobs lost, and this impact can strike a small town deeply. As the American Hospital Association (AHA) reports, “With each closure, Americans lose access to essential services, and communities lose a central component of their local economies. The consequences of closures are significant.”

A recent study by researchers at the University of Washington found that rural hospital closures are associated with higher mortality rates, and previous research has suggested that such closures negatively affect economic measures, including per capita income and unemployment. As the AHA states, “Although there is no single policy change that can eliminate the challenges of providing healthcare in rural America, we believe that progress can be made by updating policies and investing in these communities.”

Saving a struggling hospital

Case in point: Gainesville Hospital District’s North Texas Medical Center (NTMC) faced bankruptcy, with $40 million in debt, but it bounced back through its partnership with CHC. NTMC, on the Texas/Oklahoma border, is a 60-bed acute care facility offering a variety of services, including pediatrics, radiology and a women’s health center.

NTMC opened in 2004 but had nearly collapsed under the weight of its debt after a little more than 10 years in service. After one attempt to partner with a regional healthcare provider proved unsuccessful, NTMC turned to CHC, which created a multipart plan—including updated supply and inventory practices—to restore the hospital to stability. For several years since, the hospital has hired new doctors, spent several million dollars in equipment upgrades and created positive financial growth. The hospital employs about 350 people, and as with any community hospital, numerous local businesses nearby rely on the facility. Were such a hospital to close, the effects on the community in terms of service and economic impact would be significant.

CHC responds to the needs of hospitals such as NTMC with HealthTrust’s help. “Our team stepped up and supported our hospitals in terms of supplies,” says Pruitt. “We were able to change what we do on a daily basis to more of a sourcing and distribution option for these hospitals. They didn’t have other people looking out for them.”

Nick Burgess

“It has been a great collaboration,” says LaFemina. “They achieved significant savings because we worked closely together. We supported CHC in implementing strategies and identified multiple options in order to maximize savings with minimal behavior changes for CHC facilities.  We’ll continue to support and maintain these agreements throughout the life of the term.” As a result of their efforts and partnership with HealthTrust, CHC has brought on an average of 15 new hospitals per year and has onboarded seven CHC hospitals since the start of the fiscal year in July.

Nick Burgess, VP, Strategic Accounts and Vendor Management at CHC, adds, “I think we’re not only saving hospitals; we’re saving communities as well.”

Contact the Medical Device Management Team for more information.

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