February 17, 2021 – Premier (Charlotte, NC) announced this month that President Mike Alkire will succeed Susan DeVore as CEO and continue to serve as president and a member of the board, effective May 1.
Alkire participated in a Q&A with The Journal of Healthcare Contracting (JHC), covering his 18 years at Premier and the past 12 months of the pandemic. Alkire also answered questions about transitioning to the CEO role and Premier’s trajectory for 2021 for the upcoming JHC March digital issue.
JHC: How have GPOs changed during your 18 years at Premier?
Mike Alkire: The way that Premier has evolved is three-fold: Driving higher-committed contracting strategies that result in best-in-industry pricing; technology-enabling supply chain to drive greater transparency and capture all non-labor spend of a health system; and creating strategies that vertically integrate the supply chain to drive opportunities for domestic manufacturing and reduce our health systems’ dependence on China and other countries controlling certain markets.
Our members are now looking for Premier to aid them in evolving the supply chain away from an isolated, transactional purchasing activity and toward a strategic and technology-enabled, enterprise-wide function capable of helping providers deliver better care, improve outcomes, enable population health strategies and lower costs.
Using robust data analytics, it’s clear that we can increase cost transparency for providers to identify savings and efficiency opportunities. But the most effective partners are those that are providing innovative solutions that set health systems apart in their local markets and enable them to be successful and sustainable into the future.
In addition, it’s now crucial that we stay on top of policy and regulatory developments and marketplace dynamics to help resolve drug shortages, mitigate supply disruptions and optimize purchased services spend, among other activities.
As one example, Premier’s generic drug sourcing program ProvideGx gives members access to more than 150 drugs that are or have been recently designated as shortage drugs ─ and has successfully protected supply even as demand surged more than 150% during COVID-19. A unique model in the market, ProvideGx aggregates demand from U.S. hospitals and engages manufacturers in long-term committed buying contracts, providing the surety they need to increase production or move into new markets.
We also continue to focus on meeting our members’ personalized needs, including the development of purchased services, oncology and pediatric-specific GPOs.
Further, we are leading the value-based transition from the population health space into supply chain. As the market continues to incent healthcare providers to improve outcomes, suppliers are raising their hands to go at risk with hospitals and guarantee their products’ performance.
And hospitals, for their part, are looking for more value-based contracting opportunities ─ 95% of integrated delivery networks are interested in and/or ready for these types of contracts, according to a November 2020 Premier survey. We actively work with our members to develop and deploy a data-driven value-based contracting approach that aligns with their priority needs and organizational goals.
Hospitals and health systems across the nation are also leveraging supply chain and performance improvement technology to drive organizational decision-making, standardize care and eliminate variation.
For example, one prominent health system identified $80 million in savings per year over the next five years by minimizing care variability using Premier’s platforms. This technology is propelling supply chain automation as well, from vendor sourcing and contract management to e-payable capabilities, which are poised to create significant efficiencies and save providers millions.
Alongside the continued evolution of health care, Premier has grown into a service-oriented partner and health care technology and improvement company with our industry-leading portfolio, advanced technology and data platforms, best-in-KLAS consulting team and member-driven collaboratives ─ delivering cutting-edge solutions for our members and enabling the transformation that drives the industry forward.
JHC: How have the past 12 months changed the trajectory of GPO priorities going forward?
Alkire: I, personally, never want to see another scenario where healthcare providers can’t get access to the vital PPE and supplies needed to protect their frontline workers and care for patients.
A primary focus for us has, and will continue to be, ensuring that we have a much more resilient supply chain.
That requires innovative strategies and creative partnerships that lower barriers to entry and drive stable supply. A resilient supply chain would reduce our dependence on China and other countries that have controlled the market in certain categories.
We are leveraging the power of data and ongoing dialogue with our members to drive greater supply diversity and capacity ─ increasing the production of masks, gloves and other PPE both globally and here at home.
For example, when PPE demand surged in the spring of 2020, we identified seven global suppliers to secure 36 million masks and respirators and 16 million gowns from March to May 2020. Data also informs our approach to domestic manufacturing investments, including those with Prestige Ameritech and DeRoyal Industries Inc., leveraging insights that show supplies most at-risk and where we can scale up to meet member needs.
The result was our members managed through the supply shortfalls far better than other hospitals.
The pandemic exposed other significant supply chain gaps, such as availability of supplies for the non-acute space. In June 2020, 83% of alternate site providers reported not having their PPE needs met by traditional med-surg distributors due to allocations. As a result, we are now thinking more critically about how we ensure product access across the broader health care spectrum ─ and trusted e-Commerce platforms are serving as a critical channel for providers that cannot consistently order from distributors.
Premier’s online healthcare marketplace, stockd®, has helped meet the need, offering an easy-to-use, accessible platform for providers and other industries to find vetted and reputable products.
Enhancing our AI and predictive technology capabilities is another key focus area. For example, early in the pandemic, we upgraded our technology to overlay predictive modeling with clinical surveillance and supply chain data.
This enabled providers to predict caseload surge and model the supplies they would need to handle them. We’re only scratching the surface, and technology and predictive analytics will be even more critical to supply chain operations moving forward.
Greater public-private collaboration is also vital, and Premier will continue to work closely with government stakeholders at the federal, state and local levels to build supply chain resilience. Specifically, we are engaged with the FDA to ensure supply chain transparency, from basic raw materials to finished goods. We are working with federal and state agencies to dynamically allocate products based on inventory levels and predictive usage patterns to stabilize the need for stockpiling.
For U.S. Infrastructure 2.0, we are working with Congress to bring additional domestic manufacturing of PPE and generic drugs to the U.S. where it makes long-term sense. And we will continue to build out our syndromic surveillance capabilities using clinical data sets and natural language processing to interpret unstructured EMR data, flagging certain conditions or disease based on this data.
Our members need high-quality supplies, sourcing and expert supply chain management. They also need to efficiently manage costs, while simultaneously delivering safe and effective patient care or other services. Across the Premier organization, we are continuously innovating and partnering with our members to meet these goals…