The Medical Device / Equipment Procurement Process

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In an effort to reduce healthcare costs, the landscape of delivering healthcare is shifting. The medical device/equipment procurement process is shifting its emphasis, as procurement officers at caregiving locations are given more power and influence in purchasing decisions. The responsibility of controlling costs in healthcare is no longer lies solely with procurement officers but has been increasingly extended to physicians.

In 2015, 80 percent of physicians said they have personal responsibility to control costs (compared to just 38 percent in 2005). Only 20 percent of physicians in the same study said they have complete discretion over the purchasing decisions of medical devices. This newfound focus on cost for physicians is the result of physicians moving to management-led organizations instead of physician-led organizations. While the influence in purchasing decisions has been shifting, both parties do agree that quality and clinical evidence are the most important criteria in procurement of medical supplies. Where the two parties differed was the importance of price.

The current landscape of medical equipment purchasing shows consolidation on both ends of the transaction: distributors are joining forces with each other and buying groups are consolidating to create Group Purchasing Organizations (GPOs). The goal of consolidation is to create cost savings and efficiencies through economies of scale. These GPOs typically facilitate purchasing for
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