20 Child Health Corporation of America Hospitals to use Premier's SpendAdvisor Spend Analytics Tool

Business Wire,  April 2, 2008  

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Children's Hospitals Expect to Save $10 Million in First Year of Operation

CHARLOTTE, N.C. -- Twenty Child Health Corporation of America (CHCA) hospitals are implementing SpendAdvisor, Premier's groundbreaking spend management decision-support tool, with projected first year savings expected to exceed $10 million. CHCA anticipates another five hospitals will implement the tool in the next 18 months. The 25 hospitals represent about 75 percent of those participating in the business alliance's group purchasing program.

"A task force of 20 CHCA hospitals conducted a seven-month evaluation facilitated by an outside consultant," said Karla Vialle, director of operations, CHCA Group Purchasing Services. "The evaluation included an environmental scan, vendor demonstrations and analysis of weighted decision factors. The task force chose Premier's SpendAdvisor My Spend module as the preferred product based on cost, ease of use, ROI and Premier's commitment to supporting CHCA-specific needs."

Vialle continued, "The initial 12 CHCA hospitals implementing My Spend are in various stages of utilizing the data. Of those that are farthest along, comments have been favorable about the ease of use, the power of the data, and utilization of the tool for financial and operational efficiencies."

Alan Edwards, director, Materiel Management, Children's Medical Center in Dallas, said, "The implementation of SpendAdvisor forced us to look not only at our processes but at our structure as well. The tool was instrumental in our decision to re-engineer our department with a focus on strategic sourcing using the data in SpendAdvisor as our roadmap."

Premier Vice President of Product Development and Adoption Bill Marquardt said, "Technology is a key enabler for Premier and its members. In our aligned business model we all benefit from real time contract utilization information. Contract penetration equals savings. SpendAdvisor is Premier's technology solution; it helps members understand spending and identify savings. We are convinced CHCA hospitals will be rewarded with sizable cost reductions and a significant return on their investments."

According to Vialle, CHCA evaluated spend analytics tools because data normalization allows for easier identification of cost savings, pricing discrepancies, conversion opportunities and potential group contracting initiatives.

More than 100 IDNs representing more than 560 facilities have installed or committed to the My Spend module of SpendAdvisor. The My Spend and Pharmacy Spend modules now represent more than $10 billion of medical, surgical and pharmacy spend volume. Hospitals and healthcare systems using SpendAdvisor are driving better contracts with savings of between 4 percent and 8 percent on average. The newest SpendAdvisor My Spend functionality includes automatic tier analysis and a revised supply cost reports that allow member users to manage the impact of "technology creep."

About Child Health Corporation of America

CHCA, headquartered in Shawnee Mission, Kan., is an alliance of 43 of North America's leading children's hospitals that provides a range of programs and services designed to reduce costs, increase revenue and improve the performance of children's hospitals. Through its offerings, CHCA helps children's hospitals accelerate the safe, efficient and effective delivery of clinical care. CHCA hospitals represent more than 20,000 physicians, 100,000 employees, $14 billion in revenue and $2 billion in overall product purchases. For more information, visit www.chca.com.

About Premier Inc., 2006 Malcolm Baldrige National Quality Award recipient

Serving 1,700 U.S. hospitals and more than 49,000 other healthcare sites, the Premier healthcare alliance and its members are transforming healthcare together. Owned by not-for-profit hospitals, Premier operates one of the leading healthcare purchasing networks and the nation's most comprehensive repository of hospital clinical and financial information. A subsidiary operates one of the nation's largest policy-holder owned, hospital professional liability risk-retention groups. A world leader in helping healthcare providers deliver dramatic improvements in care, Premier is working with the United Kingdom's National Health Service North West and the Centers for Medicare and Medicaid Services to improve hospital performance. Headquartered in San Diego, Premier has offices in Charlotte, N.C., Philadelphia, and Washington. For more information, visit www.premierinc.com.

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