Transcript What is a Medical GPO?

A New Business Model
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What is a GPO?
A Group Purchasing Organization (GPO) provides members
with access to pre-negotiated contracts for discounted
products and services on large volumes.
Partial list of National GPO’s: Amerinet, Adventist, MHA,
Medassets, Novation Premier, VHA, and others…
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National GPO vs. Local &
Regional GPO
• National GPO: Has contracts with national vendors &
manufacturers all over the US, and are not limited to any
geographical area.
• Local & Regional GPO: Has contracts with local, regional, and
national vendors & manufacturers as well.
• Most acute care facilities (Hospitals) belong to approximately
3 GPO’s. One national and numerous local & regional GPO’s.
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Managed Healthcare Associates
MHA
 Managed Healthcare Associates is a national GPO that
provides five different purchasing programs for their
members.
 Pharmacy, Medical Surgical, Capital Equipment,
Laboratory, and Nutrition.
 MHA is one of the largest privately held GPO’s in the United
States, with over 4 Billion Dollars in member purchases
across all of the above 5 programs.
 Members are free to choose which programs they want to
use. Whether it’s all or one. MHA is the largest GPO for
alternate sites.
 Pharmacies, Surgery Centers, Nursing Homes, and
Hospitals to name a few.
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Direct Medical
DM
• A local & regional GPO that specializes in capital equipment
& supplies. Although owned by MHA, they act as a separate
entity.
• DM’s territory and most of their members are concentrated
in the Gulf States, NC, MS, LA, AL, TX, FL. They have
approximately 400 members which are mainly acute care
hospitals.
• DM contracts can be used to help the facility by-pass the
State bid process. This is most applicable in NC, MS, & LA.
• Due to DM’s local & regional status, they are considered to
be a secondary GPO. As a secondary GPO, they do not
charge the accounts anything for their “value added
service.” Nor do they require any commitment to
compliance.
• Whenever you use DM, it will be as a secondary GPO.
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MHA & DM
Contract Portfolio
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Copiers/Fax Machine
Equipment Planning
Dietary Equipment
Computers
Hardware/Software
• Financing
• Office Equipment &
Supplies
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MRI
CT
Monitors-All Types
Security Systems
Furniture-All Types
Filing Systems
Fitness Equipment
Stress Test Equipment
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MHA & DM
Vendor Partners
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AOPD/FSI
Datascope
Dietary Equipment
Drager Medical Inc
Fitness Expo
Johnson Controls
Lanier Worldwide
Nihon Kohden
MEDIQ PRN
Medxs Solutions
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• Quinton Instrument
Company
• Richard Wolf Medical
Instruments
• Siemens Medical
• Systems Simplex Grinnell
• Skytron
• Spacesaver
• Sterling Bank
• Toshiba Medical Systems
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MHA & Direct Medical
Membership Fees and Compliance
• In accordance with the Safe Harbor Act #42 U.S.C. 1320a7b (b) (3), DM/MHA will be paid admin fees from the
suppliers, which is their only compensation.
• AOPD dealers pay a 2% administrative fee on total
purchases directly to MHA or DM.
• The 2% fee acts just like an insurance policy which
protects your investment.
• Your accounts pay no membership fees to belong to
MHA & DM.
• They do not require any commitment or compliance. If
you need to get more aggressive on our initial price
offering, MHA & DM will help you negotiate with your
account.
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MHA & DM Marketing
Support Tools
• They act as a secondary marketing arm for AOPD, by
marketing through their fax & e-mail blasts on a monthly
& quarterly basis.
• The Personal Account Representatives (PAR) will also be
passing leads to us when they have a member in need.
– All Leads must be contacted within 48 hours
– Must keep us up to date on the status of a lead
• You may also call the PAR before or after a call to pass
on information about the facility and who to speak with
or make a follow-up call on your behalf.
• The PAR is there for your benefit, get to know them and
work closely with them on current customers and
prospects.
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MHA & DM Marketing
Support Tools
• The PAR will never have voice mail, you will always get a live PAR
to help you real time vs. being put on hold or getting lost in a
phone system.
• They provide targeted mailings for vendor advertising.
• Vendors (AOPD) can utilize their quarterly newsletter as an
avenue to introduce new products and services, promotions,
or just to advertise AOPD.
• Vendor information can be obtained from their catalog,
website, or the AOPD Toolbox.
• The PAR’s will discuss new & existing contracts with
members on a daily basis.
• There is also a program overview you can leave behind with a
membership form.
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Who Can We Call On?
• AOPD sales reps may call on any Healthcare Facility not just the
traditional Hospitals (acute care).
• You may call on any doctors office large or small, surgeons,
laboratories, nursing homes, pharmacies, closed door
pharmacies, medical imaging centers, hearing aid centers,
chiropractors, even medical billing companies, and medical
equipment companies.
• If your account belongs to Adventist, Amerinet, Medassets,
Novation, Premier, or VHA, push for Direct Medical.
• You cannot call on Dentists because the Dental Association has
their own GPO to handle their needs.
• The yellow pages is loaded with medical related companies. Start
selling your share now.
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How To Sell MHA & DM
• Once the account is interested in AOPD, then you tell them
about MHA & DM and how it can save them money on their
office supplies and furniture, as well as other non-related
items that are available to them through MHA & DM.
• Make them feel good by offering the MHA & DM service that
is free for them to join, and how it could help reduce costs.
• Feel free to tell them to call MHA or DM for additional
information on their programs, or call DM while you’re on
site.
• Ask the account if they currently belong to any other
GPO’s. If they say yes, sign them up for DM, if they say no,
sign them up for MHA.
– Never sign a member to both MHA or DM. It’s one or the
other.
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How To Sell MHA & DM
• After determining which GPO you will use, have them fill
out the membership form for the appropriate GPO.
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How To Sell MHA & DM
• Fax the membership form to 804-272-7790
• Once faxed, a PAR will call the facility and give them
their customer # and they can receive a catalog of MHA
& DM services.
• If the account does not want to sign up on the spot, you
can refer them to MHA / DM offices or to their website.
• This is where the MHA & DM programs certainly add to
their overall relationship with AOPD. We offer these
services at no cost to them, as a “value added service.”
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Key Selling Points
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Two GPO programs to choose from: MHA or DM
Use MHA (National GPO) if account has no affiliation with
an existing GPO
Use DM (regional or secondary GPO) if the account
currently uses another GPO
No membership fees for your customers if they join
“Value Added” service from AOPD
AOPD dealer pays 2% admin fee on total volume
Insurance policy for existing healthcare accounts
Customers can by-pass state bidding process in several
states
There is flexibility with no commitment/compliance issues
with MHA & DM
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Key Selling Points
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Most acute care hospitals belong to multiple GPO’s, at least
one national and several local or regional
Call on any medical healthcare facility or doctor (No Dentists)
Sell to any county, state, or federal hospital
Personal Account Representatives. (PARS) work closely with
you on phone
(PARS) Pass on leads to AOPD dealers if member is in need of
a supplier
Their marketing dept assist our marketing efforts with their fax
& e-mail blasts
They provide quarterly newsletters and monthly promotions to
their customers
List of existing target MHA or DM facilities
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Price Offering
• 253 item core list (average gross profit of 10 – 12%)
• AOPD catalog contract of 10,000 items averages 34% gross
profit and 43% discount.
• If you take toner out of the catalog contract it averages 48%
off list.
• Non-catalog pricing is 35% off list with a 20% price floor.
• This contract can be uploaded into most dealers systems
right from the excel file. If you can’t load from the excel file,
FSI can help you load as a DDMS contract file transfer.
• The overall business should net out to about 26-28% gross
profit.
• You have the flexibility to negotiate additional pricing with
any of your accounts.
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DPA/AOPD Partnership
• Dialysis Purchasing Alliance
• They are members of MHA with
over 500 locations and the
potential for several thousand
• We have created a partnership
with them and they will be
sending us weekly leads
– Leads must be contacted
within 48 hours
– Must keep me up to date on
the status of a lead so I can
report back to DPA
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AOPD Toolbox
• Now a DM/MHA section
on the Marketing/Sales
page
• You can find this
presentation, all sales
collateral, DM/MHA
vendors, Core Contract,
and the DPA flyer
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Questions?
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