March 03, 2011 12:30 ET

VHA Performance Services Consultants Helped Hospitals Save More Than $122 Million in 2010 by Leveraging Both Clinical and Supply Chain Expertise

IRVING, TX--(Marketwire - March 3, 2011) - As hospitals continue to look for ways to improve their performance in light of increasing industry demands and lower reimbursements, VHA Inc., the national health care network, deployed its Performance Services consulting team to help member clients save more than $122 million in 2010, through exceeding the 2009 results by more than $40 million.

"Nearly every hospital is going to have to shave tens of millions of dollars from their operating costs in 2011, and some of the nation's largest health care systems are asking VHA to help them save $25 million, or $50 million and even $100 million each in 2011," said David Markoski, senior vice president, VHA Performance Services. "Price discounts on supplies alone won't allow hospitals to achieve the savings they need. Hospitals need a more strategic approach to cost reduction."

Markoski acknowledges that many hospitals are struggling with negative margins, while others are living on very slim margins, and that looks to be the way of things in the future. He says the pressures brought about by health care reform efforts are the key driver increasing the demands hospitals make for savings. 

To help hospitals make significant improvements to their bottom lines, VHA has adopted what it has labeled as the VHA Door-to-Discharge™ approach to cost reduction, looking at every aspect of care from the time a patient enters the hospital door to the moment of discharge. This approach looks at all business activities, care delivery and the people and material resources that are used along the way, as well as strategies to prevent readmissions.

At any given time, the VHA Performance Services team has about 100 projects underway with health care organizations that range in size from more than 5,000 beds to as few as 80 beds. Not all of the projects are focused on delivering immediate cost savings. Some projects are focused on work redesign. 

According to Markoski, the most significant savings outcomes are driven not by simply supply contracting improvement projects, but by efforts that encompass supply standardization and effective supply utilization strategies, as well as projects that take into account patient throughput, staff productivity, documentation/coding and physician alignment around medical device usage. 

The last element is central to VHA's efforts to help hospitals with Clinical Quality Value Analysis (CQVA) projects. The VHA team works with hospital teams to elevate discussions around evidenced-based medicine with physicians and drive engagement around changing product utilization, both for devices and pharmaceuticals and drive sustainable changes in supply usage.

In 2010, VHA worked with the Medical Center of Central Georgia (MCCG) in Macon, Ga., to generate savings by identifying improvement opportunities in supply utilization and achieving better pricing on physician preference products, lab products and pharmaceuticals. 

"VHA enabled us to make substantial improvements in the processes we use to manage our resources and deliver high quality care, and they should help us achieve our two-year cost-reduction goal of $3.7 million," said Tom Sands, chief professional services officer, MCCG. "We owe it to our community to operate as efficiently as we can, and we're committed to integrating best practices across our enterprise."

VHA's Performance Services is made up of more than 150 performance improvement consultants, including former materials managers and pharmacy directors and nurses. These industry experts apply their own experience in health care, their understanding of process improvement and VHA's tools to identify savings and improvement options to help members not only survive, but thrive in the increasingly demanding health care environment. 

About VHA
VHA Inc., based in Irving, TX 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 1,350 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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