Regional service center. Drug manufacturer. Group purchasing organization. Disaster response planning. LeeSar and Cooperative Services of Florida check a lot of boxes for members.
When trying to describe what solutions that LeeSar and Cooperative Services of Florida (CSF) bring to its members, an elevator pitch doesn’t do the organization justice.
For starters, LeeSar is a unique, boutique regional service center for its four members in both the regional service provider for pharmacy and medical surgical distribution. With distribution, LeeSar has a 300,000 square foot facility in Fort Myers, and approximately another 100,000 square feet in numerous locations for individual functions. CSF, meanwhile, is a Safe Harbor regulated regional group purchasing organization.
“Our purpose is to remove supply chain costs from within our members’ locations,” said Bob Boswell, president and CEO of LeeSar and CSF. “For instance, the more custom services we provide our members, the less footprint they need to have for supply chain within their own facility. That means less inventory, less staging area on their docks, less contracting and less purchasing. There’s a certain amount of efficiency that we can gain by doing this in a consolidated service model, where we’re delivering supplies in low units of measure, on a cart ready to be delivered to the point of care. There’s no staging, no unpacking, no de-casing. Our objective is to work with our members to minimize steps in the process and the supply chain resources required at each of our members.”
However, the services don’t end there. The organization also does:
- 503B drug manufacturing, sterile to sterile, all robotic
- Nuclear pharmacy compounding
- Pharmaceutical distribution and prepackaging
- EMS supplies distribution
- Custom Sterile Surgical Packs
- Record retention
- Tray exchange program (LeeSar builds and replenishes anesthesia trays, crash cart trays, epidural trays and pediatric trays for its members) using automated camera reading technologies.
- A culinary, cook and chill process for Lee Health (LeeSar provides over 18,000 meals a day out of a facility on a cook and chill process)
- Central Sterile Processing for Lee Health
“The breadth of services has evolved to be somewhat unique of any other regional distribution center or consolidated service center,” said Boswell. “Our purpose is helping our members transform to a value-based healthcare market. Our new mission, vision, values and strategic imperatives all focus on providing quality custom services at the lowest possible costs.”
A little history
In 1996, Lee Health and Sarasota Memorial Healthcare System developed LeeSar and Cooperative Services of Florida, Inc. (CSF) as a means to reduce costs for medical goods and services while providing safe, high quality patient care. Additional health systems have since joined, each having representatives on the Board of Directors.
LeeSar and CSF membership includes:
- Lee Health, the largest and only community-owned healthcare system in SW Florida with a total of 1,457 beds.
- Sarasota Memorial, a full-service health system with 819 beds; specializing in heart, vascular, cancer, and neuroscience services, and one of the highest rated public health systems in Florida.
- Central Florida Health Alliance, which includes Leesburg Regional Medical Center (605-bed acute care hospital ), The Villages Regional Hospital (198-bed acute care hospital which has more than tripled in size since opening in 2002), and Leesburg Rehabilitation Hospital
- Jupiter Medical Center, a not-for-profit 327-bed regional medical center consisting of 207 private acute-care hospital beds and 120 long-term care, sub-acute rehabilitation and hospice beds
LeeSar is the operations component of this partnership, while CSF is the corporate entity for product research, negotiation and contract management. By working together, LeeSar/CSF is comprised of two distinct companies with a combined mission: “Advance the missions of our members to improve the health of the patients and communities we serve.”
Contracting tailored to their needs
As a regional group purchasing organization or GPO, CSF’s objective is on reducing operational expenses associated with pharmaceuticals, supplies, capital, and purchase services for its members. “We really focus that effort on using governance with our members that put rules of engagement around participating, accountability, etc.,” said Jennifer Reverendo, vice president of CSF. “We also employ a clinical integration model, which provides our membership with some infrastructure across the collaborative, both in a clinical nature and financial nature as far as establishing medical advisory boards to get key physician leaders together to vet clinical strategies.”
CSF employs “strategically flexible sourcing strategies,” said Reverendo. “We want to engage our members in the right mix of market share consolidation strategies and opportunities that allow them to optimize category spend individually where it makes sense. Ultimately we are hoping to engage members in strategies focused on reducing unnecessary variation.” CSF structures agreements in a way that leverages the value of members aggregating volume as a virtual IDN, providing options for those members to optimize contracts in their own shops while still working within approved guidelines.
CSF recently entered into a unique relationship with Vizient that provides access to tools through the national GPO as well as to aggregated peer contracts. CSF is a member of Vizient, but its four members, the four health systems, are not. “Members access Vizient through CSF,” said Boswell. “Aggregation allows CSF to access highest tier categories with many Vizient agreements, but many of CSF contracts are custom agreements with Vizient for the benefit of our members only. We also contract for pharmaceuticals, and because CSF qualifies as a regional aggregation model, we can access the pharmacy aggregation tiers from Vizient. There’s also benefit in that.”
In addition to being a traditional GPO, the CSF sourcing team acts on behalf of its members directly, meaning they serve as the sourcing team for each of the member organizations in varying degrees. “CSF has created a diverse portfolio based on member needs and opportunities to leverage committed spend. If a member’s needs fall outside of that, CSF works with them to ensure contract coverage,” said Reverendo. “CSF also works with members independently to meet unique needs.”
Interconnectivity
Previously, Boswell worked for an IDN in Ohio that was a few years further along in reducing costs through supply chain integration, physician engagement, stronger market share and aggregation contracting. When Boswell arrived at LeeSar, hospitals and health systems in the South Florida region were not as progressive in these areas. “When we started benchmarking our costs, they weren’t as good as what our members thought they were based on what they were being told before,” he said. “We have made very good progress in improving access to and consolidation of member data, identifying opportunities, and documenting member contracted savings.”
LeeSar is supporting its members’ transition to value-based care. Reducing costs is one of the ways. But the member organizations are also growing. For instance, Sarasota is building an additional new hospital in Venice, Florida and an oncology tower at their current location. Lee Health recently opened a new outpatient facility in Estero, Florida and a 216-bed addition to their Gulf Coast facility. LeeSar continues to work with members relative to supply distribution plans for these initiatives.
Reducing operational clinical variability, complexity and cost, is another goal, aided by the interconnectivity of the GPO and the regional service center. “The number of SKUs we stock in our distribution warehouse is totally dependent on how standard our members are with specific product categories,” said Boswell. “Isolation and surgical gowns, gloves, and masks are several examples. If members are not standardized on these products, we have more SKUs, more stocking, and it’s tougher to get that allocation during times of COVID or any other time. Jennifer and the GPO are working to reduce the variation on similar products resulting in SKU reduction in our own distribution center. This positions us to negotiate better costs for members, better distribution fees for LeeSar, and greater allocations from our manufacturers.”
Indeed, it’s a lot of moving pieces, and LeeSar and CSF are working hard to craft their services and solutions with a focus on providing value to members. “It’s a new day for LeeSar and Cooperative Services of Florida,” said Boswell. “As our members transform, we’re in the process of transformation ourselves. There are challenges and at times we are not progressing as quickly as we would like. But these are really exciting times.”
Healthcare solutions
- Pharmaceutical – Customized compounding and nuclear pharmaceuticals, EMS services, and pharmaceutical repackaging and distribution in unit dose.
- Culinary – Customized solutions for catering and high-quality meals for hospital systems.
- Surgical Custom Packs – Custom or standard kits reduce time gathering product for procedures.
- Sterile processing – Off-site sterile processing.
- Supply distribution – Medical and surgical supply distribution in bulk and low unit of measure.
Disaster response
Due to its location at the end of a peninsula in Florida, disaster response is a unique need for members. “We have hurricane season response plans that we have developed with our members,” said Boswell. “Every year, we refresh these plans. We identify the stocking levels, both at LeeSar and at member locations, and the staffing model that needs to be maintained at the LeeSar facility. We also work with local and county law enforcement to ensure truck access when roads may otherwise be closed?