Mastering Purchased Services Cost Savings in 6 Steps
Our clients often ask us how it’s possible to achieve cost savings in purchased services that no other healthcare consulting provider can deliver.
Since 1999, we’ve been partnering with health systems and hospitals to reduce their non-labor costs.
During that time, we’ve developed a proven six-part process to identify hidden cost savings in purchased services spend.
Step 1: Obtain the line item details from your invoices.
Step 2: Carry out an in-depth review of your contracts from an operational, financial, and clinical viewpoint.
These are the vital first steps to optimize cost savings.
But, most organizations get stuck as they jump immediately to benchmarking.
To clarify, after these steps, you can move to benchmarking with an accurate view of total spend.
Step 4: Cost Analysis and Strategy.
We compile a thorough report of our analysis and recommended strategy.
As part of that process, we identify team members who need to be involved, usually front-end users and executive leaders.
Step 5: Vendor negotiations.
At VIE Healthcare®, we are involved with front-end negotiations and can also support the back end.
As a result, we ensure stakeholders and leaders in organizations are able to negotiate successfully with their vendors.
Step 6: Contract performance reviews.
A critical issue for most hospitals is that once a 3 or 5-year deal is in place, it is rarely reviewed until contract renewal.
We encourage our clients to carry out regular reviews throughout the contract period.
In other words, it’s vital to ensure invoices and deliverables are in line with contract terms.
By carrying out monthly reviews, we identify new spend and contract variations as they happen.
Purchased services cost savings can be captured in real-time.
Please reach out to us to find out how VIE Healthcare® can uncover hidden cost savings in your purchased services spend.
Reach out at lmiller@spendmend.com to discuss your cost savings goals and how we can support and accelerate cost savings opportunities in your organization.
