January/February 2007

Consorta Signs Letter of Intent to Join HealthTrust Purchasing Group


Consorta, the group purchasing organization of which Catholic Health Initiatives is the largest shareholder, has signed a nonbinding letter of intent to become a part owner of HealthTrust Purchasing Group, Brentwood, Tenn.

HealthTrust is the purchasing organization for 15 of the nation’s 17 largest investor-owned health care systems. HealthTrust represents $9 billion in annual purchases; Consorta represents $5 billion.

“For the past 18 months, Consorta’s Board of Directors has examined strategies to address the rising cost of supplies and equipment,” said Michael Rowan, chief operating officer of Catholic Health Initiatives and a member of the Consorta board. “The opportunity for Consorta to become an owner and participant in the HealthTrust portfolio of contracts offers an expected net benefit of more than $535 million during the next five years, according to an independent evaluation by Huron Consulting Group. Based on this estimate, Catholic Health Initiatives would receive an expected benefit of $134 million during that period of time.” The savings would result from purchasing supplies and equipment at lower prices through existing HealthTrust contracts, and through contracts that would be renegotiated to reflect the combined purchasing power of HealthTrust and Consorta. Consorta and HealthTrust expect to complete due diligence and negotiations by the end of February.