A Healthcare GPO Takes a Step in the Right Direction

There's only two things in life that really get me riled up. The first is the spend thrift nature of our Federal, state, and local governments (party affiliation of officials, by the way, is not an indicator of waste). Once you've seen the inside of government spending -- from affirmative action doll-outs to Halliburton hand-shakes --it's enough to make you want to pack the pick-up with can goods, dust off the 22, and head straight for the hills of New Hampshire, never to be seen by modern civilization again. Believe me, I've thought about it, except for the fact that there's only organic food in our Sub-Zero fridge, our pick-up is a mini-van, and the closest it comes to a gun rack is 17 odd cup holders.

But the second thing that ticks me off just as much as government spending are the inefficiencies of healthcare buying. Indeed, in other sectors, if the practices of healthcare procurement were standard, CPOs would be headed in only one place: straight to jail. Come on, I challenge you to tell me any other industry where suppliers have better data than the buying organizations do on their volume, pricing, etc. And what about the little matter of contracting with a buying organization (i.e., a GPO) to get better prices for you, when the third party actually makes its money on volume-based fees paid by suppliers? I could go on, but there's no need to. It suffices to say that most healthcare procurement practices would get private-sector procurement executives and CFOs fired for incompetence or indicted by shareholders and the SEC for failing to maintain adequate information and process controls.

So given this back-drop, you can imagine that I'm a fan of any sourcing and contracting offering which offers to create greater transparency for healthcare buying organizations -- especially if it reduces my rising healthcare insurance premiums each year. Earlier in the month, Broadlane, a healthcare GPO, released a customized version of the Frictionless (i.e., SAP) On-Demand sourcing and contract management products. According to the announcement, the platform "enables comprehensive electronic sourcing and contract management through a suite of Web-based services ... the platform allows for timely online collaboration with Broadlane's client-led advisory committees as the committees develop their lists of product requirements. It also offers a convenient means for Broadlane to provide the committees with bid analysis and supplier due-diligence results and to inform the committees of decisions related to contract awards. Interchange engages suppliers through iterative electronic RFIs and RFPs (e-RFx), reverse auctions, performance measurement, tracking tools and other innovative and dynamic sourcing approaches." Let's hope that Broadlane's announcement is a step in the right direction for the healthcare buying market. At this point, it would seem that anything would help.

Jason Busch

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