Skagit Valley Hospital joins Premier healthcare alliance and saves more than $1M annually

Skagit Valley Hospital of Mount Vernon, Wash., saved more than $1 million by joining the Premier healthcare alliance.

Last year, supply chain leadership at Skagit Valley Hospital decided to review its purchasing practices to identify savings opportunities due to the hospital's aggressive expansion, the economy and health reform.

During their research, a marketbasket survey revealed that Premier offered the greatest potential savings versus other group purchasing organizations. The hospital decided to switch to Premier contracts after learning that their potential savings were more than $2 million on an annual spend of $15 million, a 13 percent reduction.

Since joining Premier last fall, the hospital has realized savings of more than $1 million annually.

"I absolutely would make the change again. We're glad we made it, and finance and the bottom line are glad too," said Bill Thomas, materials management director, Skagit Valley Hospital. "It's been a lot of work for everyone, but definitely worth it. Looking for savings is an all-day, everyday, and ongoing thing. It's not something we do, and then we're finished."

Skagit Valley Hospital also joined the Hospital Shared Services Association (HSSA), a voluntary not-for-profit purchasing cooperative with more than 40 members in Washington. HSSA is strategically aligned with Premier and alliance member PeaceHealth of Bellevue, Wash., which allows HSSA members access to even larger savings through Premier's Catholic Contracting Group (CCG) contracts. CCG is a national purchasing collaborative made up of Premier's five largest Catholic member systems with more than $2.4 billion in contract purchasing volume.

Materials management leadership at the hospital is pleased with Premier's advanced supply chain technology and expects additional savings as more Premier tools are deployed, such as its MySpend™ spend management decision support tool.

"We're excited to be getting MySpend and even more ways to look for savings. Premier's tools are definitely user-friendly," continued Thomas.

As the supply chain team examines their new service line in spine supplies, they plan to address standardization, utilization, streamlining vendors and physician preference items. This year, Skagit Valley Hospital has several initiatives in place, including construction and remodeling of a new mental health center and ongoing efforts to fully integrate the clinics in the hospital materials management stream.

"These initiatives have put major strains on the materials management department," Thomas said. "If all we had to do was move to Premier, it would have been a piece of cake."