How Vanderbilt University Medical Center is using clinical evidence to drive down costs

Procured Health

Hospitals across the nation are looking for ways to improve outcomes and reduce clinical spend. However, this can be a challenging task if healthcare organizations aren't armed with the right information.

Although reining in spending is top of mind for hospital leaders, healthcare organizations have to find ways to save money without sacrificing patient outcomes. Spending on medical devices is one area that is ripe for savings, but supply chain leaders must do their homework before attempting to negotiate tougher deals with device companies or persuade physicians to change their preference items.

Gather the evidence
Instead of talking to physicians about savings and expecting them to change their preference items, supply chain leaders need to arm themselves with clinical information that physicians will respond to. However, gathering that information is not a quick process.

"To have sourcing officers who in many cases don't have clinical backgrounds trying to go through all of the literature and present a neutral environment to the physicians was difficult and time consuming," says Teresa L. Dail, RN, chief supply chain officer at Vanderbilt University Medical Center in Nashville, Tenn., which is home to Vanderbilt University Hospital, Monroe Carell Jr. Children's Hospital, and psychiatric and rehabilitation hospitals.

To solve this problem, Vanderbilt looked for outside assistance from Chicago-based Procured Health. Procured offers a medical product research platform that allows users to compare devices. Through comparison, hospitals can determine if a higher price product is worth the extra cost, or if similar outcomes can be achieved using a less expensive product.

Equipped with clinical information, Vanderbilt has successfully negotiated with vendors to bring down the price of certain products. The system has also used the evidence to provide a product comparison to physicians so they can see if a high-price device is worth the cost.

Focus on patient outcomes
Along with bringing costs down, Ms. Dail and her team have another priority — improving patient outcomes. Comparative product information is vital in achieving this goal, as well as understanding the safety of individual devices.

"Procured's tool ties into national databases that pull information from vendors regarding real-time recalls," says Ms. Dail. Vanderbilt also uses Procured's IntelligencePRO solution to further research products to determine if there has been a recall on them historically.

Get clinicians involved
Along with using evidence and literature, it is vital hospitals and health systems form a committee that involves clinicians in supply chain decision making, according to Ms. Dail.

Since 2007, when Ms. Dail came on board with VUMC, her supply chain team has cemented strong bonds with clinicians in a number of ways, including through the creation of the Medical Economic and Outcomes Committee. The MEOC is a clinician-driven process that uses evidence-based, clinically-sound, financially responsible methodologies for introducing or consolidating new supplies, devices, and technology at VUMC. The committee's evaluation also includes reimbursement considerations which have become much more important in recent years.

The MEOC has leveraged Procured's research to support their efforts because both gathering evidence and conducting a thorough analysis of that research are extremely labor intensive. Ms. Dail offered a specific example of how the partnership has succeeded. Four years ago, before working with Procured, the MEOC conducted an evidenced-based review of mesh vendors and successfully reduced the number of vendors to achieve cost savings. However, more recently, Procured provided additional evidence that was compelling enough to suggest that VUMC could further reduce their mesh vendors and take a dual source approach, which would lead to even more significant savings.

Ms. Dail says the physicians at Vanderbilt have been "extremely receptive and involved" in the system's journey to control costs. "Clinical evidence elevates the conversations within our committee and the impact that we make," she says.

More articles on healthcare finance:

Hospital CFOs' top concerns for 2016
Physician engagement: The most vital component of hospital cost-cutting initiatives
Hospitals in Dallas and Fort Worth file for bankruptcy: 6 things to know

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