ROi Delivers a Provider-Owned GPO Strategy: Five Things to Know

ROi is a vertically integrated accountable supply chain organization that offers a comprehensive and viable alternative to traditional group purchasing organizations (GPOs). We focus on all aspects of the healthcare supply chain, from planning through fulfillment, to ensuring our customers deliver the highest quality of care in the most cost-effective manner. We believe in the power of provider collaboration, achieved through customer partnerships focused on streamlining and/or controlling critical supply chain components in healthcare.

GF: Fifteen years ago, ROi was founded as the supply chain organization for Mercy—a Truven Top 5 Large Health System that owns and/or operates 43 acute care and specialty hospitals and more than 700 physician practices and outpatient facilities across Arkansas, Kansas, Missouri, and Oklahoma. Mercy tasked ROi to radically rethink supply chain operations, acknowledging that conventional business practices were not producing expected and required results. ROi developed an innovative and transformational model that aligns supply chain services and group purchasing organization (GPO) functions across the continuum of care, bringing together all relevant stakeholders. This model places the patient at the center while simultaneously recognizing the need to engage physicians and integrate systems. This radical approach has delivered more than $1 billion in savings to Mercy since 2002. In 2011, ROi and Mercy decided to commercialize the supply chain and GPO offerings.

GF: ROi has successfully grown from a supply chain department serving one health system into a cost management and supply chain solutions provider that supports multiple healthcare systems across the United States. We provide a variety of services, including:

• strategic contracting and sourcing/GPO services;
• manufacturing and packaging operations, including pharmaceutical repackaging, custom procedure trays and IV Compounding;
• in-hospital supply-chain management;
• self-distribution and transportation operations, such as consolidated service center design and management, if desired by customers; and,
• knowledge transfer solutions, providing operational direction on the above four areas and clinical integration strategy.

Because ROi has a focus that extends well beyond contracting, we look to share our experiences and successes with fellow providers, making us different from other GPOs. We believe it's critically important that providers control their supply chain destiny and not outsource critical components.

GF: Five key areas differentiate ROi in the marketplace:

1. We have a provider-owned, operator vantage point: We deliver much more than a traditional GPO model. Drawing from our daily supply chain operator experience – managing end-to-end supply chain activities (including self-distribution and logistics) for both acute and nonacute care for Mercy – we work with our fellow provider customers to leverage best practices in sourcing, contracting, standardization, utilization and supply chain management.
2. We provide a Vertically Integrated Service Offering: We leverage our self-manufacturing capabilities to provide customers with additional savings through custom procedure trays, private-label products and IV Compounding solutions. ROi sources both branded products and our own brand of private-label products, known as Regard®, which provide lower-cost product alternatives without compromising clinical value and efficacy.
3. We have experience with a Clinically Integrated Supply Chain: We have built expertise by integrating physicians and clinicians within our Service Line Contracting models that provide an evidence-based decision making process for the selection and utilization of products and services, with special emphasis on Physician Preference Items and Purchased Services categories. Our clinical apps and advanced analytics offer our customers valuable detail and intelligence into cost per case and other clinical metrics required to achieve a clinically integrated supply chain.
4. We provide Guaranteed Sustainable Cost Savings: We employ a committed contracting strategy that delivers highly competitive pricing and broad contract coverage, utilizing our proprietary benchmarking model. Our model provides long-term sustainable savings measured by the reduction in Supply Expense per Adjusted Discharge (CMI) and supply chain expense as a percentage of net operating revenue.
5. We do not charge additional Fees For Service: We offer a completely transparent pricing model providing full access to an extensive, à la carte menu of services with no hidden charges, and no service or membership fees to access our comprehensive contract portfolio or any other service offering.