November 2010

Contract Compliance Earns Major Rebate on Smart Pumps, Supplies

CHI's HealthTrust Purchasing Group contract with Hospira for "smart" IV pumps and related products resulted in a rebate payment of $1.1 million based on greater than 90% compliance with the contract throughout CHI.

"The dollars go directly back to the market-based organizations that purchase through the contract, which helps offset their supply expenses," said Steve Kehrberg, senior vice president of supply chain for CHI.

The potential for substantial annual rebates is one reason that CHI selected the Hospira Plum A+ model as its standard smart pump. The pumps are 'smart' because when they are programmed with a standard infusion medication library, they can prevent medication errors and increase the efficiency of medication administration.

"The Hospira pumps represented a huge advancement in pump technology for CHI, and also the chance to earn significant rebates," said Kehrberg. "The market-based organizations generated such a large rebate by purchasing Hospira's entire IV product line, including pump sets, nutritional products, premixes and irrigation solutions."

CHI Connect aggregates purchasing volume by vendor and by market-based organization, so rebate dollars returned to each organization are commensurate with purchasing volume.

CHI is now in the final phase of transitioning to Hospira's Plum A+ pumps, with the potential to earn more rebates in the future.