(Story updated Jan. 18)
Two disruptors in the group purchasing sector announced growth in their membership this week.
Resource Optimization & Innovation, a St.Louis-based group purchasing organization almost entirely owned by Mercy Health System, announced this week that it has signed a deal to provide its national contracts to HPS, a Middleville, Mich.-based regional GPO. The contract adds over 144 hospitals and 1,466 nonacute facilities to ROi's membership, which now has over 240 hospitals and 2,866 other sites.
Like most regional GPOs, HPS members can access the organization's local contacts as well as a national portfolio from a major GPO. For HPS, that role was previously filled by MedAssets, which was acquired by VHA-UHC Alliance in 2015 to form the Irving, Texas-based company now known as Vizient.
HPS is the second regional GPO with a MedAssets relationship to decline a new deal with Vizient in favor of ROi; Plano-Texas-based TPC moved to ROi late last year. But Vizient spokeswoman Donna Ledbetter said in a statement that HPS' choice to leave is complicated.
Most hospitals use more than one GPO, which can include a national group like Vizient and a regional one like HPS. Most of HPS' members used the former VHA-UHC Alliance or its predecessors as a primary GPO, and used HPS and its MedAssets portfolio as a secondary GPO, said Ledbetter in a statement.
After MedAssets and VHA-UHC Alliance became Vizient, HPS had to find a new partner that would offer national contacts and services, Ledbetter said. “HPS is making a business change to attempt to preserve its economics as a secondary GPO service,” Ledbetter said.
HPS CEO Tom LaPres said in a statement that the company believes the new partnership with ROi provides increased value to its members.
“The response from our membership has been very positive so far, and they are encouraged by the benefits they will realize through this transition,” LaPres said.
Ledbetter believes most of the HPS members will maintain their primary GPO relationship with Vizient. HPS represents less than 1/10 of 1% of Vizient's business, she said.
Greg Firestone, vice president of strategic customer relations at ROi, said he's heard from some HPS members that they may choose ROi as their primary GPO.
Also this week, Greenhealth Exchange announced that it has added three new members since it was founded last May by Dartmouth Hitchcock Healthcare, Dignity Health, Gundersen Health System and Partners HealthCare. The for-profit purchasing cooperative was created by Health Care Without Harm and Practice Greenhealth last year to offer a contract portfolio that includes only environmental-friendly products and services.
The group's three new member-owners include Marshfield (Wis.) Health System, Mayo Clinic and University of Vermont Medical Center. Later this year, the cooperative expects to roll out its online catalog system, which will measure the impact products and services have on environmental efforts.
Experts, including provider leaders, have warned that the mega-merger of MedAssets and UHA-VHC Alliance could spur some providers to look to smaller GPOs, including niche and regional organizations, in hopes of better customer service and increased engagement within their GPO. A number of these entities have been founded or expanded since the merger was completed.