Working Together. Buying Smarter.
Ontario hospitals regularly purchase complex capital equipment. They have similar clinical equipment needs, follow the same government-mandated procurement practices, and purchase from a common pool of vendors.
Why don’t more hospitals work together to reduce duplication of effort, pool their expertise and resources to drive better value?
The CPC leverages the power of collaboration to simplify complex procurements, while striving for the best possible price for capital equipment. It does this by coordinating the efforts of participating hospitals, resulting in an aggregation of knowledge, reduction in duplication, and large volume RFPs (request for proposals).
Over 2.5 years, the pilot on which the CPC is modeled, yielded an average savings of 9% on the cost of capital equipment, for purchases totaling $61 million.
The Four Cornerstones of the CPC:
- Increase Purchasing Power
By aggregating capital equipment volumes across hospitals, the CPC is able to leverage volume purchasing to get the best possible price. This saves on hospital costs, which can be reinvested, in more or better equipment.
- Commoditize the Procurement Effort
Procurement of clinical equipment is time-consuming for purchasing and clinical staff. By aggregating the work of specification design, RFP preparation and evaluation, and negotiation and contract preparation, the CPC can share distribute the effort and costs of this work across many hospitals, thereby reducing transactional costs or freeing up scarce resources. Building accurate and current technical specifications, and appropriate contract terms and conditions, for complex clinical equipment, demands rigor and access to subject subject-matter expertise.
- Maintain Hospital Choice of Equipment
Hospitals will maintain the ability to choose the piece of equipment that is right for their organization. After responses to the RFP are gathered, each hospital will make its own selection of equipment and is not required to align their preference with the majority of hospitals participating in the group procurement.
- Follow Procurement Best Practices
The BPS Supply Chain Directive is bringing about changes to the procurement environment for hospitals, requiring an increased level of knowledge, scrutiny and care. Each of the CPC’s procurements will be administered by procurement experts in strict adherence to the Directive, providing participating hospitals with peace of mind and exposure to leading procurement practices.
The CPC Value Proposition:
- Fixed, below-cost participation fee per procurement
- Expert procurement design and negotiation
- Collaboration with peer equipment experts to design optimal specifications
- Legal support for contract preparation
- No rebates, with all savings retained by your hospital
- No membership fee or long-term commitment
The CPC is currently identifying additional categories of equipment that may represent an opportunity for collaborative procurements. Please let us know your hospital’s capital needs, and contact us if you have plans to purchase any of the following equipment categories within this fiscal year:
- Pumps
- Ventilators
- Monitors
- Laboratory Equipment
- Patient Handling Equipment
- Diagnostic Imaging Equipment
Your volumes could be added to some very significant volumes already identified by interested hospitals.
For any questions or comments and to share your capital lists, please contact Hazim Hassan, Program Manager, at hhassan@oha.com.