How to reduce the millions wasted on purchases based on physicians' personal preferences

28 August 2009

Physician preference items (PPIs), a term used to describe a range of medical supplies, such as pricey orthopaedic implants and cardiovascular devices, are estimated at 60% of a hospital's total supply costs.

With operating costs increasing and margins from both operations and pooled investments declining, many hospital executives — once willing to quietly overlook the inefficiencies and costs associated with allowing their medical staff to use whatever products they wanted —are being forced to take corrective action.

ECRI Institute, an independent organisation that researches the best approaches to improving patient care, has revealed some of the processes that hospital c-suite administrators can implement to better manage the high cost of PPIs in a just-released white paper, Wasting Millions by Making Illogical Purchases Based Solely on Physician Preference: Not in My Hospital You Don't! [1]

"In order to attain the savings associated with acquisition of physician preference items," advises Anthony Montagnolo, chief operating officer, ECRI Institute, "hospital leaders need to win the co-operation of the physicians through an evidence-based, value-focused process."

The white paper outlines the factors that have contributed to the proliferation of PPI requests, such as allowing device manufacturers inside the surgical suite and recruiting physicians who bring with them very strong preferences for specific vendors and their products. It illustrates the multimillion-dollar impact that physician preference items make to the bottom line and lays out the framework for a PPI management process that is acceptable to all hospital stakeholders.

The white paper, available for free download, draws upon ECRI Institute's 40 years of experience in researching the safety, effectiveness, and cost-effectiveness of health technologies and the comparative effectiveness and health technology assessment work of its staff of healthcare administrators, engineers, clinicians, and scientists.

PriceGuide, ECRI Institute's medical-surgical supply and implant procurement service, benchmarks prices paid for single-use consumables — including PPIs — against prices paid by other institutions. The medical-surgical supply database helps hospitals identify areas of immediate savings to make well-informed healthcare supply decisions.

Reference

1. You can download the complimentary white paper, Wasting Millions by Making Illogical Purchases Based Solely on Physician Preference: Not in My Hospital You Don't! from ECRI Institute's Web site at https://www.ecri.org/PPI .

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