VHA members saved $369.2 million from VHA purchasing contracts and related operations in 1995, executives of the Irving, Texas-based alliance said at its annual meeting last week.
Cash distributions totaled $140.6 million. The financial returns amount to $13.70 for every $1 members spent to participate in VHA, the alliance said.
In 1994, VHA claimed supply-chain savings and other benefits of $271.8 million and distributed $122.4 million in cash. That amounted to a $10.25 return on every $1 invested.
The announcements were made at the VHA meeting in Philadelphia. About 2,400 people attended.
In a departure from previous years, VHA didn't disclose its operating income and revenues, and executives declined to discuss the reason. VHA was one of the few purchasing groups to make public its financial performance. In 1994, it reported operating income of $56.2 million on revenues of $147.7 million.
VHA is a for-profit cooperative owned by 99 hospitals and healthcare systems. In addition, 393 providers are categorized as partner organizations, and they also will share a portion of cooperative dividends.
C. Thomas Smith, VHA's president and chief executive officer, promised the alliance would develop new ways for hospitals and systems to address common problems. "We know even greater value is within our reach," Smith said.
Group purchasing represents the primary source of revenues for alliances such as VHA. Its members bought more than $6.3 billion in medical supplies and services through VHA in 1995, up 13% from 1994 purchases of $5.6 billion.
VHA added 183 new members, a 16% increase, bringing its total membership to 1,315 companies by the end of 1995. Since then, it has added 23 more.
Recently, three shareholders of the former SunHealth Alliance joined VHA. They are 587-bed Erlanger Medical Center, Chattanooga, Tenn.; 235-bed High Point (N.C.) Regional Hospital; and 796-bed Moses Cone Health System, Greensboro, N.C.
At the meeting, shareholders elected John C. McMeekin, president and CEO of Crozer-Keystone Health System, Media, Pa., to a three-year term on the VHA board. Two new board members were named earlier this year to replace retiring members. They are Van R. Johnson, CEO of Sutter/CHS, Sacramento, Calif., and Gary Strack, CEO of Orlando (Fla.) Regional Healthcare System.