SOURCE: VHA Inc.

April 19, 2011 10:00 ET

Southern Illinois Healthcare Reaps Huge Return on Investment in Just Six Months With VHA's PriceLYNX™

Rapidly Changing Healthcare Environment and Declining Reimbursements Prompt Money Saving Strategy

IRVING, TX--(Marketwire - Apr 19, 2011) - Faced with a rapidly changing health care environment characterized by decreasing reimbursements, increased charity care and escalating bad debt costs, Southern Illinois Healthcare used VHA PriceLYNX, a benchmarking and analysis service to save $500,000 in just six months. A three-hospital, two-system healthcare organization located in Carbondale, IL, Southern Illinois Healthcare embraced VHA PriceLYNX to assert greater control over the organization's supply spend. Southern Illinois Healthcare is a member of VHA, the national health care network.

"Reducing our supply costs is a critical focus for our organization because it enables our hospital to effectively combat the negative financial effects of increased charity care, bad debts and declining reimbursements from all payers," said Orrie Rouse, Director of Materials Management at Southern Illinois Healthcare. "When we first subscribed to VHA PriceLYNX, we immediately saw that we were behind in pricing. The first deal I brokered armed with the data garnered a $300,000 reduction on spine products. When I showed the vendor rep where the market pricing was, and that I wasn't competitive, the negotiation proceeded really quickly. Before VHA PriceLYNX, I never had access to that kind of information."

Other cost-reduction areas that Southern Illinois Healthcare plans to target using the VHA PriceLYNX data include anesthesia gases, tubing and orthopedic implants. Southern Illinois is also using the VHA PriceLYNX reporting to communicate its annual savings and return on investment of about $500,000 to its chief financial officer, Michael Kasser.

"There is a true return on value because subscribers are able to gain a clear market view of their activity and see an almost instantaneous return on their investment," said Justin Hibbs, senior director, analytics marketing and strategy.

Rouse continued, "I can go into a negotiation armed with 'this is a database that has information from more than 1,000 hospitals, from coast to coast, here are the [price] ranges and I want competitive pricing. If we don't get it from you I'll get it from someone else.' That gets a quick reaction from the rep."

VHA PriceLYNX is just one component of VHA SupplyLYNX™, VHA's robust suite of analytical solutions that help hospitals cut costs and improve supply chain management. This powerful array of products and services also includes: VHA DataLYNX™, VHA Physician PreferenceLYNX™, a contract catalog, plus supplemental services such as spend analysis, services analysis and pharmacy analysis that further improve members' cost saving opportunities.

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. In 2009, VHA delivered record savings and value of $1.47 billion to members. Formed in 1977, VHA serves nearly 1,350 not-for-profit hospitals and more than 30,000 non-acute care providers nationwide, coordinating delivery of its programs and services through its 16 regional offices. VHA has been listed as one of the best places to work in health care by Modern Healthcare since 2008 and one of the best places to work in IT by Computer World since 2007.

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