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LTC Purchasing's "New Kid on the Block"

July 1, 2004
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AAHSA's new purchasing partnership gives its members access to affordable supply procurement by Richard L. Peck, Editor-in-Chief
BY RICHARD L. PECK, EDITOR-IN-CHIEF

LTC purchasing's 'new kid on the block'

A national provider organization and a national distributor network have formed an unusual partnership The medical/surgical supply Big Three-McKesson Red Line, Gulf South, and Medline-should take note: One of the "Big Two" long-term care provider organizations, the American Association of Homes and Services for the Aging (AAHSA), has just taken on a new purchasing partner. Effective this past June 1, AAHSA is encouraging its members to sign on with the Independent Medical Co-op, or IMCO, for the bulk of their medical/surgical supply purchases. The partners think their relationship may well be unique in healthcare.

Essentially, AAHSA is encouraging its members to sign on with local and regional distributors who are members of IMCO and have committed to serving the LTC market. "I've heard for years our members saying that they wanted to support local businesses, if at all possible," says Scot Scurlock, AAHSA's vice-president of Group Purchasing and Shared Services. "What's great about this is that a significant number of well-known national manufacturers have agreed to come and meet them halfway on this."

Though IMCO is composed of some 120 local or regional distributors throughout the United States, initially 40 locations have met IMCO's requirements for dealing in the LTC marketplace. The brands they're offering include leading products from such companies as PaperPak, GOJO, Novartis, Smith & Nephew, Tender Care Products, and Drive, to name a few. These companies have agreed to market at this level in return for a commitment by member facilities to spend at least 60% of their med/surg buys on distributors' product offerings. The standardized delivery operations made possible by that degree of purchasing commitment allow for attractive economies of scale for the participating companies, explains Deb Bullock, director of Long Term Care for IMCO.

Describing the AAHSA/IMCO project as "a passion," Bullock notes that IMCO's principal objective is to make quality products readily available to LTC facilities at affordable prices. "It's not right that facilities should feel obligated to purchase cheap products because of budget restrictions," says Bullock. She relates the experience of a friend who, she says, was dissatisfied with the quality of incontinence briefs being used for her mother but was told by a facility administrator that he had no choice but to "buy cheap." Bullock adds, "If you're committed to providing quality care, you should buy quality products. Facilities can even use this as a marketing point and talk about the name products they use."

Both Bullock and Scurlock note that the partnership ties together specific quality enhancement projects taken up by both their industries: Quality First, initiated by AAHSA and other organizations, and the Quality Choice Network sponsored by IMCO. "The distributors provide in-services, employee training, continuing education, and other services to support the products they sell," says Scurlock.

"I think, all in all," he adds, "that we're going to make waves with this. We're not forcing compliance by our members; we're just asking for enough of a commitment for members to feel a difference, but not so much that they can't turn elsewhere when they want to. We think we're going to grow their participation considerably in fairly short order."
For further information, phone Deb Bullock at (386) 258-1530 or e-mail deb.bullock@imcoinc.com, or phone Scot Scurlock at (202) 508-9455 or e-mail sscurlock@aahsa.org. Also, visit www.imcoinc.com. To comment on this article, please send e-mail to 2peck0704@nursinghomesmagazine.com. For reprints in quantities of 100 or more, call (866) 377-6454.
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