VHA Inc. Becomes Strategic Partner in Center for Innovation in Healthcare Logistics

FAYETTEVILLE, Ark. — VHA Inc., the national health care alliance that serves more than 1,400 hospitals nationwide, has become a strategic partner in the University of Arkansas Center for Innovation in Healthcare Logistics. As a strategic partner, VHA has agreed to contribute $1,000,000 over five years to fund the center’s work to develop innovative solutions to increase efficiency in the health care supply chain.

“More than a decade ago, an industry study indicated that there is as much as $13 billion in waste in the U.S. health care supply chain, and even with the efficiencies we implemented since then, we’ve barely scratched the surface,” said Scott Downing, group senior vice president of supply chain services at VHA. “Supplies make up the second largest expense category for any hospital, so maximizing savings opportunities and strategies to enhance efficiency are essential steps to creating a healthier health care system in the U.S. We want to use individual VHA member organizations and our supply chain network as test laboratories for the ideas and innovations that come out of the center.”

The center, founded in March 2007, is an industry-university partnership that includes companies such as Wal-Mart Stores Inc., Blue Cross Blue Shield and other partners. The center’s goal is to increase the efficiency of the health care supply chain so that the right materials are in the right hands where and when medical personnel need them.

"With the support of our strategic partners, the center is poised to create real change in health care logistics,” said Ron Rardin, director of the center and the White Distinguished Professor of Industrial Engineering. “The support provided by our partners will help us to eliminate wasteful and unreliable practices in the health care supply chains that lead to increased expense and the risk of serious medical errors. We strive to create information and logistics systems that will allow providers to put the focus back where it belongs - on the patients.”

"Our agreement with VHA represents a linkage with more than 1,400 not-for-profit hospitals and more than 21,000 non-acute care providers across the nation. We all have a shared goal to help increase efficiency and improve patient care,” said Rardin.

The center, which is housed at the University of Arkansas, is dedicated to identifying and addressing gaps and roadblocks in the application and delivery of health logistics technology, as well as highlighting and replicating proven applications that are already benefiting patients and providers.

The center's work addresses information technology-based innovations for bringing visibility and collaboration to every level of the health care procurement and distribution processes. Examples of innovations the center will target include examining the broader use of bar coding; radio-frequency identification and related tracking technologies to verify that materials are delivered when and where they are needed; and the management of related inventories. The center will also seek collaboration among various parties in health care supply chains to find mutually advantageous ways to reduce costs and enhance product availability.

“Ultimately, health care needs to link cost and quality together in an understandable way for clinicians. Many of these types of advances could come out of the center,” said Downing.

Based in Irving, Texas, VHA delivers supply chain management services to reduce the cost of health care and creates regional and national networks to help members solve key clinical and operational challenges.