November 08, 2010 12:33 ET

Upper Midwest Consolidated Services Center Signs 100th Supplier Contract

Regional VHA SupplyNetwork™ Marks Major Milestone, Drives Down Costs

IRVING, TX--(Marketwire - November 8, 2010) -  The Upper Midwest Consolidated Services Center, LLC, a regional VHA SupplyNetwork, announced the signing of its 100th supply contract to benefit its members by driving down costs in the face of an increasingly challenging health care environment marked by decreasing reimbursements, escalating costs and evolving patient care requirements.

Representing about $3.3 billion in annual supply chain spend, the UMCSC was founded in July 2008 and is comprised of 35 health care systems in North Dakota, South Dakota, Minnesota, Wisconsin and Illinois. All UMCSC members are also members of VHA Inc., the national health care network. Since its inception, the UMCSC has achieved annualized savings of approximately $39.7 million.

"Signing our 100th supplier contract is an important achievement for our network," said CentraCare Health System's Kris Peterson, chairman of UMCSC's operations committee. "It signals the supplier community that our members are committed to working together to drive down supply costs and remove inefficiencies. It is clear that we are no longer satisfied with duplicating our efforts by independently leveraging all contracts on our own. As our results indicate, the UMCSC's ongoing goal is to maximize savings for the network's members, ultimately reducing the total cost of providing health care in our region."

For example, in 2009, Swedish Covenant Hospital on Chicago's northwest side saved roughly $300,000, and Rice Memorial Hospital, Willmar, Minn., saved practically $40,000. These essential savings put both organizations on more stable financial ground.

In 2009, UMCSC members' savings exceeded original projections. UMCSC members' savings for 2010 currently exceed initial projections and are occurring at a higher rate than in 2009.

On average, VHA SupplyNetwork members annually save between 8% and 12% through VHA SupplyNetwork contracts. In 2009, VHA SupplyNetwork members saved a total of $67 million.

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 more than 1,400 hospitals and more than 28,000+ 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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