"Most troubling is that some GPOs are funded by suppliers rather than solely by hospitals. The fees that suppliers pay, which would normally be considered illegal kickbacks, are allowed by the 1986 amendment to the Social Security Act. Thus, buying groups may serve the interests of the suppliers that provide their funding, not providers, thereby undermining value-based competition. While the extent of this bias is contested, the potential for conflict of interest is indisputable."
"To enable value-based competition, every buying-group practice should be consistent with open and fair competition. There is no valid reason for buying groups to accept financing or any payments from suppliers: if a buying group adds value, the customers (hospitals) should voluntarily pay for it."
Michael E. Porter, professor, Harvard Business School, & Elizabeth Olmsted Teisberg, professor, Dartmouth Center for Health Care Delivery Science"
"Porter & Teisberg, "Redefining Health Care," Harvard Business School Press, 2006
* * * * *
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IMS Institute for Healthcare Infomatics
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"Report 2 of the Council on Science and Public Health: National Drug Shortages"
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"Drug Shortage Summit Summary Report"
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"Group Purchasing Organizations' Distributor Fees Formula Requires Scrutiny: Current Practice Fails to Meet New Standards for Transparency, Ethics, and Integrity in GPO Contracting"
Report by the Health Industry Distributors Association (HIDA)
"Redefining Health Care"
Professors Michael Porter & Elizabeth Teisberg
Harvard Business School Press, 2006.
"Group Purchasing Organizations: An Evaluation of their Effectiveness in Providing Services to Hospitals and their Patients"
Prof. S. Prakash Sethi, Center for Corporate Accountability, Baruch College, City University of New York
July 20, 2006
"Defining and Measuring Product-Based Cost Savings in the Health Care Supply Chain"
Lynn James Everard, healthcare supply chain strategist
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Lynn James Everard, V.I.P.E.R Group Inc.
"Is America's Health Care Hindered by Group Purchasing Organizations?"
Garret G. Rasmussen, Washington Legal Foundation
Apr. 26, 2002