Most medical centers today acquire supplies, medications, and devices through group purchasing organizations (GPOs) rather than directly from a manufacturer. GPOs are intermediaries that catalog medical supplies so medical centers can purchase them from manufacturers. According to the American Hospital Association, 68% of hospitals used a GPO for their main purchasing needs in 2000, and by 2014, an estimated 98% of hospitals used a GPO.1 The nation’s largest GPO, Vizient Inc, claims to own 30% of the national market for all medical supplies, and, collectively, the 4 largest GPOs in the United States account for 90% of the market for medical supplies. In this Viewpoint, we explore the role of GPOs in health care, concerns with their current payment structure, and potential solutions.
Bruhn WE, Fracica EA, Makary MA. Group Purchasing Organizations, Health Care Costs, and Drug Shortages. JAMA. 2018;320(18):1859–1860. doi:10.1001/jama.2018.13604
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