A Key Step in Achieving Operational Excellence
By Ben Bailey, Director of Benchmarking, Valify
Sponsored – Valify- September 2024 – The Journal of Healthcare Contracting
In the dynamic landscape of healthcare services, managing purchased services – those provided by outside companies – is paramount. Benchmarking plays a crucial role in this process by applying a disciplined approach to negotiating pricing, service level agreements (SLAs) and contract terms and conditions.
What is Power Benchmarking?
Purchased services are critical to healthcare operations – encompassing a wide range of outsourced services such as language interpretation, laundry and linen, security and hundreds of other categories.
We select categories for Power Benchmarking based on provider feedback, overlapping initiatives, and/or top spend categories to solicit agreements and pertinent information from health systems and Valify subscribers. Our team reviews and processes this information to provide a customized report tailored to the health system’s performance in relation to its peers.
Goal of Power Benchmarking
The primary goal of Power Benchmarking is to gather and analyze various data within pre-selected categories of purchased services. The analysis enables healthcare organizations to:
- Identify Price Ranges: Power Benchmarking delves into the pricing structures of healthcare organizations and their peers, enabling them to gauge competitiveness and negotiate effectively with vendors.
- Uncover Metrics around SLAs: SLAs are crucial to ensure quality and reliability. Power Benchmarking captures and compares SLAs, offering insights into industry standards and performance expectations.
- Determine Best Practices: By studying best practices adopted by top performers, healthcare providers can learn and implement strategies that drive efficiency and quality.
- Assess Terms and Conditions: Valify reviews agreements across different suppliers and hospitals to identify contract terms and conditions prevalent in a given category. This analysis aids in structuring contracts that are fair, comprehensive, and aligned with industry norms.
What Healthcare Providers Can Achieve Through Power Benchmarking
Power Benchmarking returns value to healthcare organizations in three ways:
- Cost Savings: Comparing prices allows healthcare organizations to identify cost-saving opportunities and negotiate competitive contracts.
- Improved Quality: By adopting industry best practices and leveraging SLA metrics, healthcare providers can enhance service quality and patient satisfaction.
- Enhanced Vendor Management: Clearly defined contractual terms and conditions gets everyone on the same page and supports healthy relationships with vendors in managing contracts efficiently.
Healthcare organizations need to work with a partner in purchased services solutions that offers Power Benchmarking. Participation in this program helps providers optimize cost management, quality and vendor relationships. By
leveraging Power Benchmarking, they can navigate the complexities of outsourcing services effectively, ultimately leading to improved operational performance and better patient care.
If you want to enhance your organization’s efficiency and effectiveness in purchased services, participation in Power Benchmarking is one way to do that. To learn more about how Valify can help achieve your goals in purchased services, with an average savings of 10%-30%, or to inquire about participation in Power Benchmarking, email us at info@getvalify.com.
