SOURCE: VHA

July 14, 2008 12:45 ET

Seven North Carolina Hospitals Save $2.1 Million Through Regional Supply Purchasing Network

IRVING, TX--(Marketwire - July 14, 2008) - Seven members of the Southern Atlantic Healthcare Alliance (SAHA), a hospital network in North Carolina, have signed an agreement with Medline Inc. for custom surgical procedure trays that will save them an estimated $2.1 million annually. The purchasing agreement was forged by VHA Inc., the national health care alliance that manages the outsourced purchasing activities for seven of SAHA's 16 member health care organizations.

SAHA was formed in 2004 to build collaborative relationships among member hospitals in the region with the purpose of improving the quality of health care for the patients they serve. Dale Armstrong, chief executive officer of SAHA, says, "The relationship with VHA helps the SAHA members that belong to achieve greater financial savings collectively, than they could on their own. We are very excited about the significant savings to our members as a result of the Medline agreement and are working diligently to identify future savings opportunities."

The seven members of SAHA working with VHA, purchase about $300 million in supplies and services annually. They are working with VHA currently to review all major savings opportunities. Those seven SAHA members are:

  -- Betsy Johnson Regional Hospital         Dunn, N.C.
  -- High Point Regional Health System       High Point, N.C.
  -- Lexington Memorial Hospital             Lexington, N.C.
  -- Moses Cone Health System                Greensboro, N.C.
  -- Nash Health Care Systems                Rocky Mount , N.C.
  -- Sampson Regional Medical Center         Clinton, N.C.
  -- WakeMed Health and Hospitals            Raleigh, N.C.

Brenda Meares, director of supply chain at WakeMed, says that this is a significant win for SAHA members working with VHA. "Changing custom procedure trays is a complex project with many moving parts. We achieved significant savings by switching, but cost is far from our only consideration. We could not have achieved these savings without the support of our clinical departments. We are counting on Medline to implement and deliver the best tools for our clinical staff and patients."

Chief financial officers of these member hospitals recognize the significant advantage of aggregating volumes to achieve a contracting advantage in the marketplace. "Supplies are a significant operating expense. In this relationship, we are working together as one entity in the marketplace, leveraging our collective volumes and enjoying a huge contracting advantage for our hospitals. A unique aspect of our contracts is that rural community hospitals receive the same pricing as large urban hospitals. I appreciate the supplier community for embracing the concept. We look forward to working on many more contracts in the years to come," said Jerry Heinzman, chief financial officer at Sampson Regional Medical Center.

About SAHA

The Southern Atlantic Healthcare Alliance (SAHA) based in Cary, North Carolina, is an Alliance which builds collaborative relationships between member hospitals in the region with the purpose of improving quality, patient safety and delivery of healthcare. SAHA leads North Carolina and the region in clinical initiatives and outcomes and provides educational programs through SAHA College to benefit all members. As of January 2008, the Alliance has 16 member hospitals representing 28,000 employees and 4,400 beds.

About VHA

VHA Inc., based in Irving, Texas, is a national alliance that provides industry-leading supply chain management services and supports the formation of regional and national networks to help members improve their clinical and economic performance. With 17 offices across the U.S., VHA has a track record of proven results in serving more than 1,400 not-for-profit hospitals and 23,000+ non-acute health care organizations nationwide.

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