Hospital Savings Top $47 Million In Premier 5th Annual Supply Chain Breakthrough Series.

CHARLOTTE, N.C. -- The hospitals and healthcare systems participating in Premier Inc.'s Fifth Annual Supply Chain Collaborative Breakthrough Series have topped their $27.4 million supply chain cost savings goal by more than $20 million.

Teams reported savings of $47,079,976. The savings goal - based on individual team targets - was $27,367,541. The savings is 75 percent over the goal and represents an average savings of almost $900,000 per team and a return on investment of 45:1.

More than three quarters of the teams have participated in the Breakthrough Series before, which helps explain the dramatic savings, said Gay Wayland, R.N., Premier vice president of Supply Chain Knowledge Transfer and series sponsor. "They are taking the processes and tactics we promote in the Breakthrough Collaborative to heart and making them work for their hospitals and health systems."

The results of the orthopedic team at SSM Health Care in St. Louis, Mo., and the cardiovascular team at St. Joseph Health Center in Bryan, Texas, are representative of the significant successes Breakthrough teams have experienced this year, Wayland said.

SSM Health Care's five hospitals in the greater St. Louis area that have orthopedic joint replacement programs will save nearly $6 million in the next three years because they renegotiated joint replacement contracts using tactics learned through participation in the Premier Breakthrough Series, said Anthony M. "Tony" Trupiano, SSM's network vice president of Materiel Management. The system's agreements with its 10 orthopedic manufacturers and/or distributors were set to expire on January 31.

On a smaller scale, the cath lab team at St. Joseph Health Center in the Bryan-College Station, Texas, area (home to Texas A&M University) has achieved more than $1 million in savings, overwhelming its $150,000 savings goal.

The 210-bed major medical referral center for the 12-county Brazos Valley area, St Joseph is in a competitive market, providing most of the community's charity care; most patients are Medicare or sponsored in some way. "Every dollar we save goes directly to the bottom line," said David Mervish, team member and Inventory/Data coordinator.

Premier's Supply Chain Collaborative Breakthrough Series uses the Institute for Healthcare Improvement's (IHI) model for improvement; participants commit to collaborate with peers from other healthcare organizations to accelerate supply chain improvements. More than 200 teams have taken part in the collaborative which has captured cumulative savings of more than $150 million.

The Breakthrough Series this year addressed the perioperative supply chain, cardiac catheterization (including peripherals), orthopedic implants (hips, knees and spine) and contract administration, a new focus. The sixth annual series will launch in September 2006.

During the nine-month program, participants commit to implementing changes that will significantly improve operations and potentially eliminate millions of dollars of unnecessary supply-related expenses. Teams meet in face-to-face learning sessions three times, reinforced by monthly reports and conference calls as well as daily communications through Premier's e-mail discussion list.

About Premier

A healthcare alliance entirely owned by more than 200 of the nation's leading not-for-profit hospitals and healthcare systems, Premier helps hospitals accelerate both clinical and financial performance. Premier's shareholders operate or are affiliated with 1,500 hospitals and more than 41,000 other healthcare sites. Premier's members and clients benefit from group purchasing and supply chain services, clinical and operational performance measurement, benchmarking and insurance programs. Headquartered in San Diego, Calif., Premier has offices in Charlotte, N.C., and Washington, D.C. For more information, visit www.premierinc.com.