CEO FORUM       April 2, 2013       Jim Fitzgerald      Senior Advisor, CASpecial Operating Partner, FCA
Overview1. GPO’s2.   Parallon3.   CoreTrust
Group Purchasing Organizations1. Four Major GPO’s   • Premier   • Novation   • MedAssets   • HealthTrust2. What do GPO’s d...
Group Purchasing Organizations4.     • GPO’s key focus areas are supplies, pharma,       medical devices and capital     •...
Introduction to HealthTrust, CoreTrust &      Parallon Business Solutions              Jim Fitzgerald                April...
HealthTrust - A Global GPO•   Owned by five investor-owned and 10    not-for-profit institutions including:               ...
HealthTrust Overview•   Established as a Group Purchasing    Organization in 1999                          Committed Spend...
Strength Through Diverse Members                      Hospitals /   Alternate Equity IDNs                       Systems   ...
HealthTrust’s Foundation – An Aligned Membership•   “Patients First” philosophy     – Member-led Advisory Boards approve a...
Integrated Supply Chain – Total Cost Management                                         EFFECTIVENESS                     ...
…extending the HealthTrust portfolio to     non-health-care companies to increase scale        and value for all HealthTru...
CoreTrust…a division of HealthTrust         Formed                                                                        ...
CoreTrust’s Foundation – an Aligned Model•     Member driven decision making                     •     Unparalleled Value ...
CoreTrust Membership Process      Step 1        Step 2            Step 3          Step 4          Step 5      Sign non-   ...
Key CoreTrust Offerings     Type                        Offering            Vendors                                   Deta...
CoreTrust Members You Recognize or Know16
…HealthTrust is closely integrated with                              the provider-proven capabilities of                  ...
The Evolution of Parallon Business Solutions Market            Intensifying financial and operating pressures related to r...
Parallon’s Objectives for Clients     Partner with health-care systems to build long-term client success     Focus on impr...
Parallon Client Snapshot  HealthTrust    Workforce        Technology     Business Supply Chain   Management         Soluti...
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Jim fitzgerald GPO April 2013

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Jim fitzgerald GPO April 2013

  1. 1. CEO FORUM April 2, 2013 Jim Fitzgerald Senior Advisor, CASpecial Operating Partner, FCA
  2. 2. Overview1. GPO’s2. Parallon3. CoreTrust
  3. 3. Group Purchasing Organizations1. Four Major GPO’s • Premier • Novation • MedAssets • HealthTrust2. What do GPO’s do? • Aggregate volume, negotiate pricing • Custom Contracting e.g. Medical Devices • Spend Analytics • Consulting3. How are the GPO’s Different?
  4. 4. Group Purchasing Organizations4. • GPO’s key focus areas are supplies, pharma, medical devices and capital • GPO’s May or May Not be right for your business • They are acutely focused on technology companies • They can assist with introductions to providers
  5. 5. Introduction to HealthTrust, CoreTrust & Parallon Business Solutions Jim Fitzgerald April 2, 2013
  6. 6. HealthTrust - A Global GPO• Owned by five investor-owned and 10 not-for-profit institutions including: 2010 – HealthTrust Europe, HCA, CHS, HMA, Lifepoint, UHS and Birmingham, U.K. Consorta• Serving three market segments: 2011 – CoreTrust Europe, – HealthTrust – 1,400+ hospitals London, England – AdvantageTrust – 10,000+ sites – CoreTrust – 400+ non-healthcare 2010 – Global Sourcing, companies Shanghai, China 2006 – AdvantageTrust, Schaumburg, IL 1999 – HealthTrust, Brentwood, TN
  7. 7. HealthTrust Overview• Established as a Group Purchasing Organization in 1999 Committed Spend ($ billions) – Operating as a committed model 25 – Providing total cost management solutions $21.2 20 $19.0 – Driven by member advisory boards $18.1 $17.0 15 $14.1• Dynamic member growth – Leveraging $21 billion in annualized $9.8 10 compliant purchasing volume – 99% member retention rate since inception 5 – Partners with 7 of 9 largest for-profit IDNs 0 2007 2008 2009 2010 2011 2012
  8. 8. Strength Through Diverse Members Hospitals / Alternate Equity IDNs Systems Sites
  9. 9. HealthTrust’s Foundation – An Aligned Membership• “Patients First” philosophy – Member-led Advisory Boards approve all Sustainable contract awards Price Advantage* 14%• Broadest Contract Coverage 12.2% – Portfolio covers at least 85% of typical spend, 12% including non-traditional areas 10.7% 10%• One-Price-for-All 8.0% – Due diligence history of 7 - 12% savings 8% 7.2% – Extended to sub-acute classes via 6% AdvantageTrust• Total Cost Management Solution 4% – Category expertise in custom contracting for 2% medical devices and purchased services – Comprehensive supply chain and clinical 0% GPO A GPO B GPO C GPO D expertise supporting all consulting offerings *Internal due diligence over• Integrity and Culture prior 18 months – Unsurpassed ethics, no conflicts of interest
  10. 10. Integrated Supply Chain – Total Cost Management EFFECTIVENESS EFFICIENCY Point ofExpense Management Care Supply Chain Operations• Leverage GPO portfolio & • Develop standard operating expertise Delivery model• Implement strategic custom • Optimize technology contracting • Integrate supply chain − SourceTrust − ServiceTrust Right Product, Right Price, Right Place management in clinical areas (OR and Rx)• Ensure robust Value • Evaluate Shared Service Analysis process, including opportunities − Formulary development EVALUATION • Implement pharmacy − Clinical intervention remote order entry − Standardization initiatives − Utilization review Data Analytics - inSight • Standardize Master Files • Create an enterprise data warehouse • Develop analytic tools • Measure Key Performance Indicators • Reference price, operating and outcomes benchmarks
  11. 11. …extending the HealthTrust portfolio to non-health-care companies to increase scale and value for all HealthTrust members11
  12. 12. CoreTrust…a division of HealthTrust Formed 65+ Mar 2006 32 Members 60 Members 126 Members 210 Members 310 Members Categories 2006 2007 2008 2009 2010 2011 Today Vestar Capital Onex, CDR and Blackstone K.K.R. Bain Capital Warburg Pincus Apax Partners 415+ Relationship Welsh Carson Members THLee• CoreTrust By The – 2006 - extended leveraged buying model to the Numbers: commercial sector Retention Rate – Primary driver of initial growth – 7 of largest 10 private equity firms sponsor CoreTrust to their portfolio companies 99% Billion Compliant Purchasing Volume – Combined leverage enhances price value for all – $1B in committed volume across 30+ indirect 21+ Private Equity spend categories, e.g. HR, IT, office supplies, Relationships parcel, rental cars 30+12
  13. 13. CoreTrust’s Foundation – an Aligned Model• Member driven decision making • Unparalleled Value – Advisory boards led by subject – One-Price-for-all philosophy matter experts in collaboration – Broadest contract coverage in with HealthTrust indirect spend – Private equity advisors – Due diligence history of 10%+ – Summit meetings – forum for sustainable savings alignment, negotiations and communications • Exceptional Vendor Support – Integrity and culture – no conflicts – Dedicated account resources of interest, safe harbor rules – Executive sponsorship – Superior contract terms & conditions Vendor RFP Issuance Financial Board Review Contract Qualification Must satisfy Analysis & Consensus Award Advisory Board prerequisite terms Member-specific Align on sole, dual, Summary & tools approved and conditions or multi source Account conversion vendor support13
  14. 14. CoreTrust Membership Process Step 1 Step 2 Step 3 Step 4 Step 5 Sign non- Provide data Review savings Sign Vendors are disclosure for market assessment Participation notified and agreement basket analysis summary Agreement programs are implemented Assessment Decision Implementation Day 1 Speed to Savings Day 4514
  15. 15. Key CoreTrust Offerings Type Offering Vendors Details IT Hardware/Software/Storage •Desktops, laptops, servers, printers & peripherals Committed •Expansive core list with discounted staples alternatives Office Supplies •Quarterly price refresh based on wholesale index •Very competitive rates on domestic and Int’l parcel Small Parcel •Includes Ground & Express •Includes National, Enterprise and Alamo Rental Car •Emerald status preserved for conversions •US & Canada, customized city surcharges •Fastest growing pharmacy collective in the market Pharmacy Benefits Management • Open architecture; implementation allowances •Dedicated services at the national account level Life/Disability/Travel Insurance •Guarantees, price protection, implementation allowances • Full staffing plus vendor management service options Temp Labor • One markup rate nationally for most employee types Optional • Aggressively discounted click-charges include service Copiers and supplies, periodic maintenance, & repairs •Purchase, lease or rent options • Extend the useful life of IT assets, No EOSL Extended Warranty •Reduce the annual maintenance cost •Reservationless audio, web and Video conferencing Conferencing •Global Network access •Rebates on all AMEX payment offerings Corp. Purchase & Travel Card •Includes T-, P-card, B2B Payment Solutions (BIP & vPay)15
  16. 16. CoreTrust Members You Recognize or Know16
  17. 17. …HealthTrust is closely integrated with the provider-proven capabilities of Parallon Business Solutions© 2011 Parallon Business Solutions, LLC.
  18. 18. The Evolution of Parallon Business Solutions Market Intensifying financial and operating pressures related to reform,Dynamic technology and point-of-care delivery evolutionParallon Sharing “operator” expertise built upon 12 years of shared-serviceCharter success to provide progressive solutions in a dynamic market HCA Shared All About Rev Cycle Supply Chain IT and Service Operations Consolidated Project Mgmt Staffing consolidated into 18 Services Initiatives Formed into 8 centers centers developed160 hospitals 120 ASCs 1999 2008 2009 2011 1993 All About Market HealthTrust HealthTrust Staffing Parallon Europe Offerings Launched signed first Launched Acquisition IDN18
  19. 19. Parallon’s Objectives for Clients Partner with health-care systems to build long-term client success Focus on improving cost efficiency and cash flow enhancement Allow clients to focus and protect their clinical core Provide deep expertise in health-care operations Develop innovative solutions to meet evolving market/government requirements Integrate solutions into client culture that optimize client outcomes (quality, service, satisfaction, financial)19
  20. 20. Parallon Client Snapshot HealthTrust Workforce Technology Business Supply Chain Management Solutions Performance20

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