August 19, 2009 12:37 ET

Lancaster General Health Cuts $2.4 Million in Pharmacy Costs by Working With VHA Inc.

IRVING, TX--(Marketwire - August 19, 2009) - Patient medications represent one of the single largest expense categories for many hospitals, and, therefore, an important area to examine for cost-saving opportunities. Lancaster General Health in Lancaster, Pa., was spending $20 million annually on pharmacy costs and wanted to find new ways to save money. The hospital turned to VHA Inc., the national health care network, to help it extend the capabilities of its own staff and to find cost reduction opportunities, without compromising patient care or clinical quality. VHA's consultants conducted a full-service pharmacy audit, which not only helped the health system create new staffing models but also saved the system $2.4 million annually.

"We knew we had cost-savings opportunities, but we didn't have the staff to address them," said Richard Paoletti, vice president of operations at Lancaster General. "Not only did VHA identify specific savings opportunities, but they also helped our new clinicians engage with the cost-savings initiatives."

The VHA team focused on major operational processes, benchmarks and challenges facing the department. For example, they assessed the average number of medication orders processed per pharmacist over the course of a 24-hour period. This information helped them align staffing levels with the department's workload and development a staffing model consistent with best practices.

"Because VHA's team is made up of pharmacists, they have an affinity with the hospital pharmacy and understand our clinical care needs," says Paoletti. "Their approach is about improving clinical utilization and patient care through best practices. They are not just about cutting drug expense, but they are looking at the whole clinical cost."

As a result of VHA's work, Lancaster General saved money in the following areas:

--  $360,980 by standardizing to a generic antiemetic
--  $234,256 by establishing guidelines for Rx syringe fills on epoetin
--  $131,573 by converting from IV to equivalent oral medications
--  $52,000 by converting from a long-acting erythropoiesis agent to a
    shorter acting one

Lancaster General is one of hundreds of hospitals nationwide that are turning to VHA to find savings in their supply chain. Earlier this year, VHA pledged to help members save millions if they applied VHA's proven supply chain management methodologies.

For more information about VHA's pharmacy consulting services, visit VHA's web site.

About VHA

VHA Inc., based in Irving, Texas, is a national network of not-for-profit health care organizations that work together to drive maximum savings in the supply chain arena, set new levels of clinical performance and identify and implement best practices to improve operational efficiency and clinical outcomes. Formed in 1977, through its 17 regional offices, VHA serves more than 1,400 hospitals and more than 24,000 non-acute care providers nationwide.

Contact Information