Group Purchasing Organizations (GPOs)
(8/27/09)- In 2002, the New York Times wrote a series of articles about two of the Group Purchasing Organizations, namely Premier, of Charlotte, N.C. and Novation, of Irving, Tex.
GPOs do the centralized purchasing of drugs, medical equipment, etc for groups of medical organizations, from hospitals to HMOs, etc, so that they can get the benefit of lower prices because of increased volume of buying.
The gist of these articles was that sometimes these organizations get more benefits than do the various clients of the GPO, and in fact do not help to reduce the cost of medical bills.
Three Senators have sent a letter to seven of these companies requesting data from them about their business practices. The three senators are Herb Kohl, chairman of both the Special Committee on Aging and the Judiciary Committee's antitrust subcommittee; Charles Grassley of Iowa, the senior Republican on the Finance Committee and a member of the antirust subcommittee; and Bill Nelson, a Florida Democrat on the Finance and Aging Committees.
Besides Novation and Premier, the other five GPOs getting the
letter were MedAssets of Alpharetta, Ga. (the only publicly
traded GPO); Consorta of Scharmberg, Ill; Broadline, of Dallas,
Tex.; Amerinet, of St. Louis, Mo.; and the HealthTrust Purchasing
Group of Brentwood, Tenn.
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Allan Rubin
posted August 27, 2009
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