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e-Commerce

Ottawa Hospital to automate supply chain using GHX

OTTAWA and TORONTO – The Ottawa Hospital expects to achieve significant workflow improvements and cost savings by joining the Global Healthcare Exchange and participating in the e-Supply Chain Project.

The Ottawa Hospital represents the largest group of hospitals in the Canadian capital and is one of six project sites participating in the e-Supply Chain Project, which is supported by OntarioBuys and managed through the Healthcare Supply Chain Network (HSCN), a network of healthcare supply chain provider and supplier professionals.

The Ottawa Hospital integrated its Oracle enterprise resource planning system (ERP) to GHX in April, which has enabled the hospital materials management staff to send and receive purchase orders and purchase order acknowledgements electronically with suppliers.

Prior to connecting to GHX, all of The Ottawa Hospital’s orders were placed via phone or fax.

“Automating our supply chain using GHX can significantly reduce our supply chain costs and help us focus our resources towards more value-added activities,” says TOH’s Corporate Director, Purchasing Services Guy Lemay. “After careful review of our current processes, we have recommended some refinements that have proven to create actual tangible savings and efficiency gains.”

Hospitals using GHX have reduced costs through increased productivity and fewer purchase order errors. The cost to process a purchase order electronically is five to seven times less expensive than a phone or fax order, according to McKinsey & Co.

GHX hospitals, on average, report that it takes less than one minute to place an order via GHX, compared to nine minutes to place a phone order and six minutes for a manual fax order.
By ensuring the data they use for purchases matches product data maintained and verified by suppliers in the GHX AllSource content repository, hospitals have also reduced invoice exceptions. The Health Distribution Management Association says it costs between $15 and $50 (shared by hospitals and suppliers) to address a single invoice exception.

A 2004 study, authored by Deloitte and sponsored by HSCN, found that Canadian hospitals can expect to reduce their supply chain costs by 2-6 percent by adopting a fully integrated e-commerce solution. Integrating materials management and ERP systems to GHX enables connectivity for Canadian hospitals with the majority of the suppliers from whom they purchase products most often.
Later this year, The Ottawa Hospital will also be able to utilize more advanced transaction sets, including electronic invoices, payment remittances and catalogue/contract price updates, all of which automate additional aspects of the purchasing process.

Earlier this year, Shared Healthcare Supply Services of Toronto, another e-Supply Chain project site, implemented GHX as its eCommerce platform. “GHX is proud to have the opportunity to work with the e-Supply Chain project sites, to help control rising healthcare costs. With the supply chain being the second highest expense for hospitals after labor, we are confident that working together, we can make a difference,” says GHX Canada General Manager Nils Clausen.

More than 260 hospitals and 40 suppliers are currently participating in GHX in Canada.

About Global Healthcare Exchange
Global Healthcare Exchange (GHX) provides an open and neutral electronic trading exchange, as well as complementary products and services, designed to improve the procurement-to-payment process in the healthcare supply chain. Service offerings include:
• Exchange services that support trading partner connectivity and provide electronic transaction sets, order validation and reporting tools
• Content services utilizing the GHX AllSource product content repository as the foundation for data synchronization and advanced content services
• Contract services that allow users to maximize contract utilization
• Procurement services that enable automation of the requisitioning process
• Business Intelligence reports designed to provide strategic decision-making data
Through these services, healthcare providers and suppliers can improve efficiencies, automate processes and reduce operating expenses. Equity owners of GHX are Abbott Exchange, Inc.; AmerisourceBergen Corp.; Baxter Healthcare Corp.; B Braun Medical Inc.; Becton, Dickinson & Co.; Boston Scientific Corp.; Cardinal Health, Inc.; C.R. Bard, Inc.; Fisher Scientific International, Inc.; GE Healthcare; Guidant Corp.; HCA; Johnson & Johnson Health Care Systems Inc.; McKesson Corp.; Medtronic USA, Inc.; Owens & Minor; Premier, Inc.; Siemens; Tyco Healthcare Group, LP; University HealthSystem Consortium.; and VHA Inc. For more information, visit www.ghx.com.

About The Ottawa Hospital
The Ottawa Hospital is a multi-campus, academic health sciences centre, serving 1.5 million residents of Ottawa and Eastern Ontario, both in English and French. It offers specialty centres in cancer, heart, kidney and vision care, as well as rehabilitation services. Working together with the Ottawa Health Research Institute, the University of Ottawa, and other partners, TOH is gaining national recognition for high quality patient care, teaching and research. The Ottawa Hospital provides care for more patients than any other hospital in Canada. To meet the high demand for its services, it relies on a dedicated and compassionate team of 13,500 employees, physicians and volunteers. TOH is adept at managing its resources, such as its $813-million annual operating budget. It ranks as one of the most efficient teaching hospitals in the country.

About Healthcare Supply Chain Network
The Healthcare Supply Chain Network (HSCN) is a Canadian network of healthcare supply chain provider and supplier professionals. HSCN was established to promote the implementation of supply chain management leading practices in healthcare that result in greater effectiveness and efficiency, improved patient outcomes and greater alignment between supply chain partners.

About e-Supply Chain Project

The e-Supply Chain Project is managed through the Healthcare Supply Chain Network (HSCN) and supported by OntarioBuys. Six project sites form the e-Supply Chain project and collectively represent more than 46 hospital facilities in Ontario. The e-Supply Chain Project will reduce hospital operating costs, improve service levels, and support the delivery of better patient care through the development and implementation of leading supply chain practices. For more information, visit www.hscn.org/escproject.

About OntarioBuys
Announced by the Ontario Government in May 2004, OntarioBuys’ mandate is to facilitate and accelerate the implementation of integrated Supply Chain Management leading practices in Ontario’s broader public sector. OntarioBuys is supporting Ontario hospitals to improve the efficiency, effectiveness and responsiveness of their supply chains, for the benefit of patients, health care workers and the public generally.

 

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