Spend Analytics Tool Speeds Decision Making at Baptist Healthcare

System

CHARLOTTE, N.C.–(EMWNews)–One of Kentucky’s largest not-for-profit

healthcare systems expects to save at least $1 million in supply expense

during its first year using SpendAdvisor, Premier’s

innovative spend management decision-support tool.

In fact, Baptist Healthcare System (BHS) was able to pay all expenses

associated with using the tool for three years with savings generated in

just the first three months of use.

“That kind of ROI makes it easy to sell to

administration,” said Mike Reeves, Baptist

Healthcare System, corporate director, Supply Chain. “Our

experience so far is nothing but positive.”

The five-hospital system serves four markets in Kentucky including the

largest in Louisville and Lexington. With more than 9,000 employees, it

operates nearly 1,500 acute care beds in the four hospitals it owns and

also includes primary physician practices, urgent care, home health,

occupational health, and wellness/fitness centers.

Hospitals include Louisville’s 407-bed Baptist Hospital East, the system’s

largest; 349-bed Western Baptist Hospital in Paducah; 371-bed Central

Baptist Hospital in Lexington; 240-bed Baptist Regional Medical Center

in Corbin; and Baptist Hospital Northeast in La Grange with 90 beds. BHS

also manages 285-bed Hardin Memorial Hospital in Elizabethtown.

SpendAdvisor’s MySpend module was installed in

the owned hospitals first. The managed hospital was added just recently.

It provides quick and easy access to supply chain savings opportunities.

Users can identify contracts that have not been activated; on-, off- and

non-contracted spend; as well as contract optimization and

standardization opportunities. The tool also monitors contract

utilization and compliance (including on locally negotiated contracts)

and benchmarks pricing by contract, facility, department, cost center or

product.

BHS purchasing is not centralized, since the hospitals are located all

over Kentucky, but contracting is. “Keeping

all hospitals on the same contracts is important,”

Reeves noted.

“The very first thing we looked at were

opportunities we had just by turning on access price (price activation),”

he said. “These were purchases we previously

didn’t have visibility to or know that there

were Premier contracts. Just by turning these contracts on at the access

price was a big win for us. We found a few things off contract. What we’re

looking at now are best tiers and areas where we might have conversion

opportunities by switching to vendors of functional or clinical

equivalent that are on a Premier contract.”

When considering SpendAdvisor, Reeves didn’t

really look hard at other options. Coming from a consulting background

before joining Baptist about five years ago, he’d seen much of what the

marketplace has to offer. Several years ago he looked at a tool from

Owens & Minor as well as MedAssets. “When

I saw MySpend for the first time, I realized that I had to have it,”

he said.

From a management standpoint, Reeves likes the dashboard functions. “I’m

not in there using it every day like my analysts are, so the dashboard

is very helpful. I can get a quick, at-a-glance look at any areas where

I might follow up,” he explained. “We

are pretty much reliant on SpendAdvisor to identify expiring contracts.

It’s also been a real help to us to keep our

pricing clean, see what contracts are coming up, what we need to turn on.”

Purchasing staff in all hospitals have access to MySpend but, said

Reeves, “We’re

doing such a good job with this tool keeping up and staying on top of

things that they don’t need to get into it.

That’s a benefit to all of us because we haven’t

had to add FTEs in this process. We’re able

to crank this information out with such regularity now that it’s

really been great from a customer service point of view as we serve the

folks out in the field.”

Reeves continued, “When you first turn it on,

the information you get out of it is like trying to drink from a fire

hose; there’s so doggone much. It’s

taken us some time to understand what all it can do. We’re

really, really pleased.”

About Premier Inc., 2006 Malcolm Baldrige National Quality Award

recipient

Serving more than 2,000 U.S. hospitals and 53,000-plus other healthcare

sites, the Premier healthcare alliance and its members are transforming

healthcare together. Owned by not-for-profit hospitals, Premier operates

one of the leading healthcare purchasing networks and the nation’s most

comprehensive repository of hospital clinical and financial information.

A subsidiary operates one of the nation’s largest policy-holder owned,

hospital professional liability risk-retention groups. A world leader in

helping healthcare providers deliver dramatic improvements in care,

Premier is working with the United Kingdom’s National Health Service

North West and the Centers for Medicare & Medicaid Services to improve

hospital performance. Headquartered in San Diego, Premier has offices in

Charlotte, N.C., Philadelphia and Washington. For more information,

visit www.premierinc.com.

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