Medline Industries Inc - Brief Article

Health Industry Today, July, 2001

Medline Industries Inc., Mundelein, Ill., and Ascension Health signed a $650 million cost management, supply-distribution agreement under which Medline will become the health system's primary supplier and distributor of medical and surgical products.

Ascension health is the largest not-for-profit health system in the United States.

As part of the five-year agreement, Medline guaranteed to save Ascension health more than $43 million during the term of the contract.

Medline said savings are driven by its ability to deliver its own manufactured products directly to Ascension Health facilities. On non-Medline brand products, the company will distribute supplies under a fee structure that is based on the activity required to handle and move products.

Medline said the new structure will provide Ascension Health significant savings as opposed to the traditional "cost-plus" structure.

"Medline's ... willingness to explore all areas of potential savings was part of the reason we chose the company as our supply chain partner," said Arnie Kimmel, CEO of Ascension's supply chain initiative.

* www.medline.com www.ascensionhealth.org