The Ontario Hospital Association (OHA) is pleased to announce that the first group procurement of its Capital Procurement Cooperative (CPC) program is launching this fall with a Diagnostic Imaging (DI) RFP. The OHA is looking for hospitals planning on purchasing DI equipment before the end of the fiscal year, to join this exciting opportunity.
Ontario’s 151 hospitals spend hundreds of millions of dollars each year on capital equipment. While collaborative structures exist for buying medical and surgical supplies, the purchasing process for capital equipment has remained largely fragmented. Building on the success of the group purchasing initiative led by the Council of Academic Hospitals of Ontario (CAHO), the OHA is now focused on offering group procurements of committed volumes. Within these, the CPC will commoditize the procurement effort through detailed equipment specification development, RFP administration, negotiation strategies, contract preparation techniques, and standardized legal service offerings.
The OHA surveyed Ontario hospitals to identify what equipment categories they intend on procuring within this fiscal year. Overwhelmingly, hospitals indicated the need for equipment found within the DI category. In addition to being in high demand, DI equipment lends itself to group purchasing, as items tend to be extremely complex, specialized, costly, and therefore, well-positioned to deliver the promised value of collaborative procurements.
The CPC’s principal value is to offer hospitals across Ontario the opportunity to improve their purchasing power for capital equipment through the aggregation of greater volumes, while reducing duplication of the procurement effort. In addition, participation in the CPC’s DI RFP has been designed to offer hospitals the following:
- Professional bid administration services provided by a top national firm that will manage the RFP process and lead negotiations in accordance with the BPS Procurement Directive.
- The ability to shape the RFP with individual hospital specifications.
- The ability of each participant to evaluate and choose the DI equipment suitable for their hospital.
- Legal support to expedite preparation of contract signing.
- A fixed, below-cost participation fee with no membership fee or long-term commitment.
- Savings generated by lowering the cost of equipment during negotiations, not through rebates.
- A commitment to customer service and a program that delivers value for OHA members.
- The ability to work with the CPC through their representative Shared Service Organizations (SSOs), as appropriate.
From October 2007 to April 2010, CAHO piloted the Capital Equipment Group Purchasing Initiative. The pilot demonstrated the benefits of group purchasing capital equipment, saving hospitals approximately over 9% on a total spend of over $61.4 million. The OHA looks forward to expanding this project to more hospitals and delivering significant cost savings to the health sector.
To learn more about the program or schedule a meeting to discuss the CPC and the DI RFP, please contact Anthony Jonker at ajonker@oha.com.
More information is also available on the OHA website (www.oha.com/cpc)