What is a GPO in healthcare?
A healthcare group purchasing organization (GPO) is a member-based organization that utilizes the buying power of their membership to negotiate with manufacturers to provide better pricing and rebates. The manufacturer rebates depend on the volume a GPO brings to that manufacturer.
How do I know if I currently belong to a healthcare GPO?
Many members are unaware of their organization’s relationship with a GPO. This is due to a few common reasons. GPO memberships are often in perpetuity, which means the organization could have joined a GPO many years ago under different management. Staff turnover at facilities dilute the relationship with a GPO, and GPO services, once implemented, remain in the background of the purchasing process.
The best way to find out if you are currently using a GPO is to ask someone in purchasing or finance. These departments often receive the rebate checks and manage most contracts for the facility.
Can I belong to more than 1 healthcare GPO?
The short answer is yes. But there are a number of caveats that are important to understand. It is very important that any item that you receive a rebate on is reported through one GPO. You can not report the same item through multiple GPO’s. There are also GPO’s that require a minimum volume in order to receive the best pricing. If that minimum is not met because of the use of multiple GPO’s, you may actually pay more than you anticipated in the initial agreement. PRIME Services does not require minimums in their agreements and can work with any organization to customize the best options.
How does the GPO help reduce my prices?
The more volume a GPO can offer a manufacturer, the greater the discounts the group receives. In the case of food service distributors, GPO’s share their pricing discounts to reduce your cost on these specific items. GPO’s can provide cost analysis on your behalf to ensure you are getting the best pricing available. The process is simple and takes very limited effort on the facilities part.
How do rebates work?
When you purchase items with a rebate attached to them, the item is tracked by your GPO through a DCN# and that rebate is assigned to your account. Generally rebate checks are delivered quarterly.
How do I know if I am getting the best GPO pricing?
The best way to know if you are getting the best GPO pricing is to request a cost analysis. This link (put link here to the cost analysis page) will take you to the cost analysis page that outlines the simple process of having your invoices reviewed to ensure the best pricing.
Is my current food distributor part of a GPO?
The best way to find out is to ask your food distributor representative if you are receiving GPO pricing. GPO’s work with all types of food distributors. We can also help by letting you know if the distributor you are currently working with is part of our network of distributors.
How much do I save by being part of a GPO?
Depending on the type of product, volume of purchases, and the GPO you choose, savings can be significant. We have seen savings of tens of thousands of dollars on food purchases alone. In the areas of medical supplies, maintenance supplies, paper and disposable products, medical waste, and many more, the savings add up. PRIME Services has relationships with manufacturers and distributors in every area of purchase in healthcare. Learn more (link to our about manufacturer/distributor list) We can do a cost analysis on any items you are currently purchasing.
What are the types of products I can buy through a GPO?
PRIME Services has relationships with manufacturers and distributors in every area of purchase in healthcare. Learn more (link to our about manufacturer/distributor list) We can do a cost analysis on any items you are currently purchasing.
Technology is a critical component of business and PRIME Services has programs to improve purchasing, drive cost reduction and improve dietary management. We also provide consulting and supply chain management for our members.
Can I use my rebates for employee rewards?
PRIME Services has an exclusive relationship with Food Service Rewards. This program taps into a separate rebate program, exclusive from your current food rebates, and focuses on employee appreciation programs. Many of our members use this program to support employee of the month programs, employee appreciation programs, and overall employee engagement efforts at your location. This program can be implemented no matter what GPO you currently get your food rebates through. To learn more about food service rewards go here (need a marketing page for FSR)