Outpatient Surgery Magazine - Subscribers

Year of the Nurse - November 2020 - Outpatient Surgery Magazine

Outpatient Surgery Magazine, providing current information on Surgical Services, Surgical Facility Administration, Outpatient Surgery News and Trends, OR Excellence and more.

Issue link: http://outpatientsurgery.uberflip.com/i/1306204

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Page 39 of 83

T otal joints are a hot specialty and orthopedic vendors want a piece of the action. Leveraging your facility's cur- rent case volumes and the expected explosive growth of future demand to deal exclusively with a select few companies is a smart business strategy. Look no further than Twin Cities Orthopedics (TCO), an independent practice with multiple loca- tions throughout Minnesota and western Wisconsin. In 2012, leaders of the group's fledgling total joints program made the game-changing decision to limit its implant and instrument purchasing to just two vendors. The arrangement, known as a dual-source agreement, paid off in a big way. "At that time, the move yielded us a pricing improvement of about 20 to 30 percent," says Aaron Johnson, chief executive officer at TCO. The group consolidated vendors to help grow its business, and last year did nearly 2,000 total joint procedures in its EXCEL program. At that volume, an all-play model yielded even better pricing than the dual-source agreement, which is why TCO returned to a traditional bidding model. Granted, many outpatient total joints programs don't have that type of volume. "From a cost and reimbursement standpoint, facilities that perform 200 to 300 cases a year benefit significantly from a consolidated vendor model," says Mr. Johnson. "The move puts them in a position to make their program more successful." Pricing discounts are a primary motivator for 4 0 • O U T P A T I E N T S U R G E R Y M A G A Z I N E • N O V E M B E R 2 0 2 0 The Case for Consolidating Orthopedic Suppliers Cost savings is only one of the benefits realized by limiting the number of vendors who vie for your facility's business. Jared Bilski | Managing Editor BETTER TO ASK Now's a good time to strike a deal with vendors thanks to shifts in the orthopedic marketplace, according to Aaron Johnson, chief executive officer at Twin Cities Orthopedics. Ryan Shaver

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