Group Purchasing Sector Promoting Innovation, Diversity and Eco-Friendly Products

The 13th Annual Report found that HGPII members are able to meet these goals because they have a variety of policies in place that support the integrity of their respective business models.

The comprehensive survey of nine organizations, who are among the HGPII Charter signatories, studies business practices and ethical standards within the group purchasing sector, particularly for hospitals and other health care providers. The year-long research project includes utilizing a combination of a detailed public questionnaire, management interviews, site visits, and an annual mandatory Best Practices Forum, which permits industry leaders and compliance officers to explore best practices and anticipate new standards.

“Our annual evaluation is a comprehensive and independent review of the business practices of the HGPII members. This, the thirteenth annual review, demonstrated that individual companies that are members of the HGPII organization continue to demonstrate the highest ethical standards and best business practices in their group purchasing activities,” Senator Byron Dorgan, National Co-Coordinator, HGPII said. “Our research demonstrates that HGPII members have implemented clear policies and standards and levels of compliance to assure they meet the standards set out in the HGPII charter. Further, we continue to believe that group purchasing continues to provide significant cost savings in the health care supply chain.”

The Annual Report also uncovered the following advances that support the adoption of best business practices:

GPOs Advance New Technology and Innovation: HGPII members are engaged in business practices that facilitate the timely identification and adoption of emerging technologies in the area of healthcare supplies, medical devices, and services for their members. HGPII members host and attend trade and vendor expos and other events that allow them to engage directly with healthcare suppliers. HGPII members also closely review recommendations for products that they receive from their members.

GPOs Promote Greater Opportunities for Diverse Suppliers: HGPII members are making strides in their efforts to promote opportunities for small, minority, veteran, and women-owned vendors in the supply chain. Many engage in an array of educational initiatives and business strategies designed to create opportunities for vendors who are underrepresented in the industry. Some GPOs have contracts with a growing number of diverse suppliers, and others have collaborated with leaders in this area to take advantage of programs and networks established by peers.

GPOs Support the Use of Environmentally-Preferred Products and Services: GPOs are driving the demand for the increased use of environmentally-preferred products and services in the healthcare supply chain. While the demand for these products and services varies regionally, it is clear that there is growing interest in understanding the best attributes to incorporate into the list of available items and to ensure that the claim of environmental superiority over other products is verified by an independent third-party.

“The demand for affordable and quality healthcare is on top of everyone’s mind, so creating an urgent need for cost control in every facet of the healthcare system is critical,” said Phil English, National Coordinator of HGPII. “In this era of heightened scrutiny over healthcare costs, we’ve seen the HGPII members strive to promote transparency and police ethical practices in healthcare purchasing, all the while looking to identifying innovative healthcare technologies, promoting opportunities for diverse suppliers and expanding the use of environmentally-preferred products and services. HGPII looks forward to working with its members to do their part to reduce healthcare costs by seeking greater efficiencies in the system.”

The Role of GPOs in Healthcare

Healthcare GPOs are business organizations that pool the purchasing volumes of member hospitals, health systems and other providers like nursing homes, home healthcare agencies, and physicians. GPOs ensure acquisition of the best and most cost-effective products and services and assist their members in improving quality of care for patients and efficiencies throughout the supply chain.

Background: HGPII Annual Report and Members

The HGPII report is the product of an ongoing process that involves an individual commitment by each member organization to implement ethics standards, employ best practices in contracting, address vendor grievances, and offer appropriate administrative fee structures. HGPII is managed as an independent institution by Arent Fox LLP, with oversight by key industry leaders.

Nine of the nation’s leading GPOs founded HGPII in 2005 to promote and monitor the best ethical and business practices in purchasing for hospitals and other healthcare providers.

The HGPII member GPOs are: Children’s Hospital Association (CHA), Acurity, formerly known as Greater New York Hospital Association, HealthTrust Purchasing Group, Health Procurement Solutions, LLC (HPS), Intalere, Premier, Inc., TPC, Vizient, and Yankee Alliance.

English and Dorgan are former Members of Congress from the U.S. House of Representatives and the U.S. Senate, respectively, and they co-chair the government relations practice at Arent Fox. Visit the HGPII website for additional commentary from English and Dorgan on this year’s report.