Va and defense health care: potential exists for savings through joint purchasing of medical and surgical supplies
| DOI | https://doi.org/10.1108/JOPP-03-02-2003-B006 |
| Date | 01 March 2003 |
| Published date | 01 March 2003 |
| Pages | 275-286 |
| Author | |
| Subject Matter | Public policy & environmental management,Politics,Public adminstration & management,Government,Economics,Public Finance/economics,Texation/public revenue |
JOURNAL OF PUBLIC PROCUREMENT, VOLUME 3, ISSUE 2, 275-286 2003
SELECTED REPRINT
VA AND DEFENSE HEALTH CARE: POTENTIAL EXISTS FOR
SAVINGS THROUGH JOINT PURCHASING OF MEDICAL AND
SURGICAL SUPPLIES
U.S. General Accounting Office*
ABSTRACT. The Department of Veterans Affairs (VA) spent $500 million
and the Department of Defense (DOD) spent $240 million for medical and
surgical supplies in fiscal year 2001. Since the 1980s, to achieve greater
efficiencies through improved acquisition processes and increased sharing of
medical resources, VA and DOD signed a memorandum of agreement in 1999
to combine their buying power. VA and DOD saved $170 in 2001 by jointly
procuring pharmaceuticals, by agreeing on particular drugs to be purchased, and
contracting with the manufacturers for discounts based on their combined larger
volume. VA and DOD have not awarded joint national contracts for medical and
surgical supplies as envisioned by their memorandum of agreement, and it is
unlikely that the two departments will have joint national contracts for supplies
anytime soon. However, a few VA and DOD facilities have yielded modest
savings through local joint contracting agreements. The lack of progress have
made in jointly contracting for medical and surgical supplies has, in part, been
the result of their different approaches to standardizing medical and surgical
supplies. Other impediments to joint purchasing have been incomplete
procurement data and the inability to identify similar high-volume, high-dollar
purchases.
BACKGROUND
VA operates one of the world’s largest health care systems, spending
about $21 billion a year to provide approximately 3.8 million veterans
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* Reprinted from a June 26, 2002 U.S. General Accounting Office statement
(GAO-02-872T). Several modifications are made, including endnotes,
references, and moving “Scope and Methodology” to the text. Moreover,
several sections were left out, including its transmittal letter.
Copyright © 2003 by PrAcademics Press
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