360-degree approach leads to $21.6 million non labor savings

The client

Five hospital system in the Pacific Northwest with more than 1,000 beds

The challenge

  • Supply cost metrics indicated significant room for improvement
  • Organization was undergoing a merger with a larger health system with different supply catalogue and different information system
  • Value analysis efforts were primarily focused on new technology introduction rather than cost reduction

The approach

  • The process began with a high-level assessment of supply cost and utilization within the perioperative settings, including a review of physician resource utilization across high-volume and high-cost DRGs
  • Data analysis and benchmarking highlighted several large opportunities which were then confirmed through interviews with key stakeholders throughout the organization
  • Novia discovered opportunities to reduce significant costs in the operating room, but also realized that several of the opportunities involved products used outside of the perioperative environment
  • A long-term strategy was developed to expand the cost reduction efforts to all departments and maximize potential savings throughout the entire organization

The results

$10.5M in savings was targeted for this ongoing project. To date, $21.6M has been implemented.

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