Article

Another GPO Superpower: More Access to Suppliers

June 12, 2024
Nurse checking notes and paperwork while on the phone
Healthy communications between a non-acute facility and a supplier are critical to ensuring ongoing success and building solid, long-term relationships. One way to ensure strong communications, along with competitive pricing, is to work with a group purchasing organization (GPO) that specializes in non-acute healthcare products and services. 

When facilities are dealing with suppliers on their own, communications and responsiveness may be slower than when interacting with GPO-contracted vendors. GPOs’ purchasing power gives them significant leverage with suppliers. For example, a GPO may bring 1,000 healthcare organizations to a single supplier, which has garners them more influence than a single facility negotiating on its own. 

In many cases, an authentic effort to engage a supplier is enough to jumpstart a relationship. However, a GPO already has established partnerships with suppliers, giving members confidence that the vendors have been screened, are reputable and have relevant products or services.

TAKING A BIG PICTURE VIEW OF CONTRACTS

Non-acute healthcare facilities typically have myriad contracts across a range of suppliers for everything from clinical products to capital equipment to purchased services. Likewise, suppliers work with many organizations in diverse businesses. With so many contracts for both parties to keep track of, delays in responses sometimes occur.
 
For example, a small non-acute organization, such as a single physician medical office, may represent a low percentage of business for a supplier, making it a lower priority for the sales rep. If supply chain disruptions or product shortages occur, the biggest and most profitable customers will probably take precedence. As a result, on their own, non-acute facilities may take a back seat to large hospitals, integrated delivery networks or GPOs representing a large pool of members.

THE IMPORTANCE OF A CONTRACT IMPLMENTATION TEAM

A contract implementation team helps GPOs better serve their members. For example, Provista’s contract implementation team works on behalf of members to ensure they receive the best pricing tier based on their purchases. The team also facilitates fast connections with some of the nation’s most reputable suppliers.

The specialized team can also deliver value by:

  • Efficiently rolling out new contracts, reducing the time it takes for members to benefit from new agreements
  • Ensuring that suppliers maintain compliance and adhere to the terms and conditions of contracts 
  • Monitoring contract performance to identify areas for improvement
  • Managing contracts to ensure members receive all applicable and negotiated benefits 

A contract implementation team can also help ensure ongoing communication and support, bridging the gap between suppliers and GPO members. The team can also resolve issues and support members to effectively optimize contracts.

“Members can place orders across multiple suppliers from a single platform rather than the manually intensive approach of having to visit each individual supplier’s website to place an order.”

BENEFITTING FROM A GPO’S EXPERTISE

A GPO works on a member’s behalf to improve existing relationships and build strong new ones with industry-leading suppliers. For example, if a GPO member is dealing with a non-responsive supplier, and the contract is handled through the GPO, the group purchasing organization will work to resolve the situation.
 
In addition, a GPO like Provista can provide significant and ongoing value by initiating contracts, streamlining the onboarding process and handling communications for members. In the event service is disrupted, GPOs can find alternative suppliers, if needed. 

Plus, a materials management platform, like the Envi® software platform offered by Provista, makes purchasing more visible and technology-enabled, which reduces back-and-forth communications with suppliers. A GPO like Provista and a modern platform such as Envi help foster stronger relationships between members and suppliers by making processes such as ordering, invoicing and tracking products transparent and automated. 

This removes the need for manual intervention for procurement and helps improve communication efficiency. A GPO-supported materials management platform also consolidates processes. For instance, members can place orders across multiple suppliers from a single platform rather than the manually intensive approach of having to visit each individual supplier’s website to place an order.

Another benefit of working with a GPO is the analytics. Suppliers often report a member’s spend, and the GPO can collect and integrate the data for analysis. The insights into buying patterns can help inform future purchasing strategies to help save money and leverage inventory. It’s another way GPOs deliver ongoing value in procurement processes. 

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