Eliminating the Middle Man in Orthopedic Product Acquisition

In an advisory roundtable at the Becker's Hospital Review 5th Annual Meeting on May 16th in Chicago, Steve Lamb of Memphis, Tenn.-based Implant Partners, and Matthew Henderson of Denver-based TRG Healthcare, discussed a new model of aligning surgeons and hospitals to help lower orthopedic costs while maintaining clinical quality.

Their message was simple: "You do not have to comprise quality to save half the cost on hips and knees," said Mr. Lamb.

The current way suppliers are working with physicians is not sustainable, said Mr. Lamb, as it creates excess waste in the supply chain.

"The way to save is not to get a lower-quality device that costs less to manufacture. It's cutting the [selling, general and administration] expenses," Mr. Lamb said.

To cut these expenses, Implant Partners reengineered an orthopedic implant delivery model in which hospital leaders and physicians align to make product acquisition decisions. Essentially, the function of the sales representative is replaced with hospital staff.

"This stuff isn't just being dumped off at your back door," Mr. Lamb said, adding there is a training period to ensure the adoption of this new model is properly and effectively integrated.

He said this new model saves between 40 and 70 percent of costs, and all the savings go straight to the bottom line.

To ensure success with this new model, Mr. Henderson said hospital-physician alignment is crucial. It already exists, just between the wrong parties.

"Alignment exists," he said. "It's just not between hospitals and surgeons. It's between ortho companies and surgeons."

More Articles on Hospital Supply Chain:

3 Tips for Reducing Supply Chain Costs
5 Opportunities to Increase Supply Chain Savings
11 Ways GPOs Can Help Mitigate Drug Shortages

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