Here at VIE Healthcare®, we have what we call the “perfect strategy” for purchased services cost savings.
That solution is a multi-year strategy.
Luis Martinez uses this phrase during a recent podcast which you can listen to here.
Luis suggests that utilizing a multi-year strategy can help you to renegotiate your vendor contracts.
It’s a perfect solution to manage your hospital’s purchased services spend.
Renegotiating the contract and performing an RFP is just the beginning.
In the middle, before the contract expiry date, lies the strategy.
As Luis says, the utilization reviews, line-item analysis, and understanding of pricing opportunities are all preparation for contract renewal.
I’d never thought of it in that way, but you need time to prepare.
That’s what the multi-year strategy does.
- Carrying out quarterly business reviews.
- Performing line item invoice reconciliation to your agreement.
- Talking to your front line users about how the contracts are going.
- Doing true spend analytics to understand your spend in contract.
- Testing the marketplace and preparing for contract renewal.
Purchased services spend can account for between 40-50% of your hospital’s non-labor costs.
Our spend data analysis is vital to help hospitals achieve the massive potential cost savings in this key area.
Spend data analytics enables your hospital to identify major cost savings opportunities. This includes items with incorrect pricing, or those that are on or off-contract.
As we say at VIE Healthcare®, “what can be measured can be improved.”
Without spend data analytics the management of your hospital’s finances is likely to be based on outdated information. This means that significant cost savings are being missed.
If you adopt this process, you’ll uncover a deeper level of cost savings and optimize your cost structure on a consistent basis.
Contact Lisa Miller or Luis Martinez to discuss how your hospital can implement this multi-year strategy.
Reach out at firstname.lastname@example.org to discuss your cost savings goals and how we can support and accelerate cost savings opportunities in your organization.