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
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
• Content services utilizing the GHX AllSource product content
repository as the foundation for data synchronization and advanced
• Contract services that allow users to maximize contract utilization
• Procurement services that enable automation of the requisitioning
• Business Intelligence reports designed to provide strategic
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,
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.