BC arranges bulk purchase of cardiac
VICTORIA – New contracts to provide
all health authorities with cardiac supplies such as heart pacemakers
and defibrillators and home oxygen services will save the health system
$57.5 million, announced Health Services Minister Kevin Falcon.
The savings were achieved in the first two procurement processes
undertaken by the province’s new B.C. Health Authority Shared Services
Organization (SSO). SSO combines the buying power of the province’s six
health authorities by amalgamating several purchasing processes into
contracts with larger volumes of standardized products.
“At a time when we are working to make our healthcare dollars stretch
farther to balance budgets and preserve the healthcare services patients
depend on, innovation in purchasing plays a critical role,” said Falcon.
“The magnitude of the savings realized demonstrates the tremendous
potential to reinvest savings from supply chain services into direct
The contract for cardiac supplies will save $45 million over the next
five years and home oxygen services will save $12.5 million over the
next five years, representing 38 percent of the more than $150 million
savings first identified in a business case announced in December 2008.
The contract for cardiac rhythm disease management implants, consumables
and accessories (products that comprise the full range of adult and
pediatric implantable cardiac pacemakers and anti-arrhythmia devices,
leads and accessories) will generate $9 million annually for five years.
The home oxygen process covers services for home and portable
supplemental oxygen which allows patients – particularly those with
chronic obstructive pulmonary disease – to increase daily activities and
slow the deterioration of their condition. The SSO arrangement for this
therapy will save the system $2.5 million annually for five years.
The SSO assumed accountability for supply chain services for all six
health authorities in February, 2009. Key to its business approach is
increased process efficiency, standardization, capital avoidance and
combining the buying power of its members
“We currently have several procurement processes under way and we are
confident that SSO will deliver on its mandate of creating enhanced
value for the healthcare system”, said Lynda Cranston, chair of the SSO
board and president and CEO of the Provincial Health Services Authority.
“The fact that the very first processes undertaken by this new
organization will achieve more than a third of the projected savings is
extremely encouraging. We certainly look forward to sharing more
successes in the coming months as additional contracts are released.”
An integral part of the CRDM procurement was SSO’s clinical evaluation
process that included cardiologist and cardiac surgeon representation
from across the province.
“We were satisfied that the SSO staff recognized the importance of
clinical appropriateness and the need to ensure a balance between
achieving optimal pricing and maintaining a competitive provider
market,” said cardiologist Dr. Charles Kerr, chair of the Provincial
Advisory Panel on Cardiac Health. “We were pleased with SSO’s
understanding of the requirements for cardiac rhythm disease management
across the province and the opportunity for physician input into the
process. The savings from this provincial procurement will be used to
address other pressing cardiac patient needs.”
The SSO is working on processes in other non-clinical services confirmed
to have savings, including purchasing, warehousing and distribution.
Posted July 30/09.