The Corporate Contracting Department of Yale New Haven Health System is responsible for using the combined resources of the health system's three hospitals to buy goods and services at increasingly competitive rates. Contracting enters into purchasing agreements for everything from sutures to food products to spinal implants.
To find system-wide opportunities for cost savings, the three YNHHS hospitals have established nine committees that review nonlabor purchases. Senior managers lead the nine committees which include representatives from surgical services, cardiac, general medical, pharmacy, facilities, non-clinical, ITS and ancillary and medical equipment.
The Non-Clinical Non-Labor Committee is the committee that seeks to reduce costs across areas that include office supplies, food products, environmental services supplies and parking services.
In terms of office supplies alone, the Yale New Haven Health System will this year purchase almost $2.4 million, which amounts to roughly $800,000 for paper; $800,000 for printer toner; and $800,000 for supplies, including pens, pencils and post-it notes. "Our goal is to continue to offer quality items to employees and to purchase them at the best possible price," said Richard Dowling, corporate contracts specialist, Corporate Contracting. "The cost/value initiative is helping us find and extract waste from our system that allows us to invest in patient care."
Dowling points out that currently employees may choose from more than 4,600 items which are under contract to YNHHS through its vendor, Office Max. Office Max pricing reflects the pricing contract that YNHHS has negotiated through the Northeast Purchasing Coalition (NPC), a group of more than 100 New England hospitals and health systems. YNHHS is NPC's largest member.
On the office supply front, Contracting is working to save in three areas: paper, toner and general office supplies.
The Non-Clinical Non-Labor Committee recently reduced the cost of paper by $20,000 through negotiations and consolidating the number of items purchased.
In the coming year, additional focus will be put on how to decrease the actual use of paper, which is both cost-effective and environmentally friendly. The system has also had success with recycled toner cartridges. Approximately 60 percent of printers can accept re-manufactured cartridges which so far have saved the system more than $113,000.
In the general office supplies category — an area ripe for savings — are the post-it-notes that employees love to use. They are available in many sizes and colors from the 3M Company, which developed the product, or from generic competitors, which offer both quality and savings. The system is standardizing the number of post-it-notes that employees order and it is expected that this will save YNHHS an additional $7,000 annually.
For greater efficiency and savings, Contracting is developing a formulary of 500 products to standardize the number of products employees can order. It will be introduced over the next few months.
"Reimbursement rates are being cut sharply at the state and federal levels," said Pamela Scagliarini, vice president, Supply Chain Management, "and it is imperative that we eliminate waste so we can continue to invest in technology and patient care."
Scagliarini notes that at YNHH, a steady stream of waste-busting ideas have come from employees who submit them to the WorkSMART program, available on the intranet at Employee Self Service.
"Some of our best ideas for saving have come from employees and we encourage them to keep sending them to WorkSMART," said Scagliarini. "Employees are really pioneers about how and where we can eliminate waste."