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The Situation

Supply Chain Management

CHCCommunity Hospital Corporation

The Solution Community Hospital Consulting (CH Consulting),

the management and consulting arm of CHC,

has partnered with HealthTrust Purchasing

Group (HPG) to provide community-based

hospitals with comprehensive supply chain

management and access to HPG’s portfolio

of specially priced, clinician-recommended

products and services.

For independent hospitals, a relationship with CH Consulting brings aggregated purchasing volume and

more favorable pricing, resulting in significant savings.

“Participating in the CH Consulting GPO allows a hospital to obtain system-level pricing without being

part of a large healthcare system,” said Tony Ybarra, SVP of Supply Chain for CHC. “On average, we are

seeing savings of about 9 percent annually.”

For today’s healthcare organizations, joining a group purchasing organization, or GPO,

can significantly reduce supply costs while streamlining the procurement process.

By combining its supply spend with that of the group, a healthcare organization gets

the buying power and leverage of a much larger entity. Unfortunately, since smaller

independent hospitals don’t have as much purchasing volume, they tend to receive

less favorable pricing than their larger counterparts. This is where Community

Hospital Corporation (CHC) can help.

(over)

Together, CHC-owned facilities and CH Consulting clients have an annual spend of $126 million and expect to save $5.9 million annually by using HPG.

Our supply-chain cost savings have been tremendous. Our projections show we’ll save $953,000 in one year, and in actuality we probably will exceed that.”

~ Jim WelshDirector of Materials Management,

Huntsville Memorial HospitalHuntsville, Texas

“

Community Hospital Corporation5801 Tennyson Parkway, Suite 550, Plano, Texas 75024

Phone: 972/943.6435 Fax: 972/943.6401www.communityhospitalcorp.com

CHC’s ExperienceIn 2009, CHC began an extensive review

process to determine the best GPO for its owned

hospitals. After a Request for Proposal process

and significant due diligence, CHC chose

HPG. As a hospital-owned GPO, HPG stands

apart from other GPOs in that commitment to

superior patient care and sensitivity to physician

preference guide its purchasing efforts.

Its Clinical Advisory Boards, made up of

clinicians and hospital management from

member facilities, continually evaluate the

products and services offered, and then standardize the procurement of high-quality products through

select vendors in order to maximize purchasing volume and increase savings. However, while most

products and services are offered through only a few contracted vendors, “physician preference”

areas such as cardiovascular and orthopedics are managed differently with the understanding that

selecting appropriate medical devices is a physician’s prerogative. As such, a broader contract

selection in these areas is available.

Joining the CH Consulting GPO CH Consulting serves as a liaison between HPG and community-based hospitals with less than $25

million in annual material purchasing. All CH Consulting clients – regardless of size – have access to

the same pricing on medical and surgical supplies; pharmaceuticals; and human resource services,

including employee benefits, relocation and background screening. Together, CHC-owned facilities

and CH Consulting clients have an annual spend of $126 million and expect to save $5.9 million

annually by using HPG.

For each prospective member, CH Consulting conducts a supply chain and cost analysis, which

identifies items already being purchased by the healthcare organization that are exact matches with

HPG’s contract items. This shows how much new members can save simply by purchasing those

same items through the GPO. Then, with an eye toward maximizing savings, CH Consulting works

with the healthcare organization to smoothly transition to HPG’s products and services portfolio.

CHC owns, manages and consults with community-based hospitals. For more information about our services, call Mike Bowers, VP of Business Development at 972.943.6400.

Our contracts are definitely more favorable since partnering with HealthTrust and CHC. Our savings over a year’s time made this a positive move for the hospital.”

~ Jim Henderson, Director of Materials Management,

Artesia General Hospital in Artesia, New Mexico

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