OC Reilly Blog: Careful Assessment Yields Seven-Figure Savings

By George Vunovic, Vice President of Technology Solutions, OC Reilly Inc.


(March 7, 2015)–What happens when the leadership of a progressive, Mid-Atlantic health system delivering all forms of high-level patient care – a leadership team including physicians, surgeons and executive administrators – continues to recognize the financial bottom-line stress created by the use of very high-cost products and medical equipment?

What happens when this leadership team realizes that the costs associated with Physician Preference Items (PPI) and Medical Equipment Management (MEM) product choices cannot be sustained, but are unsure of available options, or how to evaluate them in the most efficient and effective manner?

Answer?  They reached out to our team at OC Reilly. 

We quickly went to work, drawing on our national and regional resources, and ultimately arrived at two recommendations:

1)    That the health system conduct trials on PPI alternatives, such as cardiac rhythm management and orthopedic products, to determine appropriate levels of care without compromising quality; and

2)    That we perform a comprehensive assessment of the health system’s MEM spend, identifying options to lower costs in the maintenance and repair of these expensive assets.

In the end, the health system determined that the PPI alternative products were equal to, if not superior in certain areas, to its current devices.  Also, by re-negotiating its medical equipment maintenance contracts, it dramatically reduced costs without any changes to equipment coverage or uptime.  The product and sourcing initiatives identified by OC Reilly improved the health system’s annual bottom-line results by seven figures.

This experience proved once again a concept we believe in very strongly at OC Reilly – that effective supply chain management, for most companies and organizations, remains a treasure hiding in plain sight.  With these significant savings, we believe this client would likely agree.


# # #