The State of Indirect Spend and its Importance in Healthcare

Indirect spending is defined as any purchase or services that are internal or external to a healthcare organization but fall outside of med-surg supplies, pharmacy, physician preference items (PPI), and capital. You might be surprised to learn that indirect spending accounts for up to 30% of a hospital’s total operating expenses.

Today’s guests discuss the current state of indirect spending, its importance in the healthcare space, and some of their success stories. 


Guest speaker:
John Andrews
Strategic Sourcing Manager - Purchased Services
Business Diversity Manager
Rush University Medical Center


Hawanya Blakely, MBA
Strategic Sourcing Manager - Purchased Services 
Purchasing & Contracting
Rush University Medical Center


LaTammy Marks, MBA, BSN, RN
Performance Improvement Program Director, PI Collaboratives


Show Notes:

[02:04] The state of indirect spend within healthcare organizations today.

[03:33] How Rush University Medical Center took a proactive approach to identifying indirect spend opportunities.

[05:01] Why Rush University Medical Center made indirect spending a priority.

[07:51] How leadership sponsorship contributed to their success.

[09:12] Where a healthcare organization should start. 

[10:23] Importance of participating in the Vizient Reducing Variation Indirect Spend Benchmarking Study.

[11:25] Understanding your indirect spending and the number of vendors that you’re using within a specific category.

[12:07] Importance of aligning across various system facilities.


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