Frustrated with ongoing shortages of key drugs, a new grassroots group led by anesthesiologists is calling for the repeal of federal legislation that permits group purchasing organizations (GPOs) to engage in what they call collusive and anticompetitive activities. Several senior U.S. lawmakers have asked the Government Accountability Office (GAO), the investigative arm of Congress, to look into the allegations that GPOs are at least partly responsible for the nation’s drug shortages.
“We are convinced that the anticompetitive contracting and pricing practices, kickbacks and self-dealing of hospital GPOs are the root cause of this public health emergency,” said anesthesiologist Robert A. Campbell, MD, co-chair of the new group, Physicians Against Drug Shortages (PADS). “We’re launching a national campaign to build public awareness of these anticompetitive practices and press Congress to halt them,” said Dr. Campbell, who also is vice president of the Pennsylvania Society of Anesthesiologists and a state delegate to the American Society of Anesthesiologists (ASA).
Dr. Campbell described PADS as “a small group of physicians who met at the recent ASA meeting. After a totally unsatisfactory panel on drug shortages we chose to exchange emails and explore an economic explanation for drug shortages. Our solution will save at first $35 billion per year in health care costs. Once competitive forces are restored in the health care supply chain, even more savings will be realized.”
Any attempt to link GPOs to drug shortages is an “irresponsible and dangerous distraction,” countered Curtis Rooney, president of the Healthcare Supply Chain Association (HSCA), a trade association representing 14 GPOs, including the nation’s five largest. “The true cause of drug shortages is manufacturing problems, disruptions and barriers to entry in getting new suppliers online when there is a disruption in supply. The fact is that GPOs are taking a variety of creative and innovative steps to reduce drug shortages,” Mr. Rooney told Anesthesiology News.
Leveraging Purchasing Power
GPOs negotiate contracts with manufacturers and vendors of pharmaceuticals and other medical products on behalf of their customers, typically hospital groups and other large health care organizations. About 72% of all hospital purchases are made through GPO contracts.
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“We are convinced that the anticompetitive contracting and pricing practices, kickbacks and self-dealing of hospital GPOs are the root cause of this public health emergency,” said anesthesiologist Robert A. Campbell, MD, co-chair of the new group, Physicians Against Drug Shortages (PADS). “We’re launching a national campaign to build public awareness of these anticompetitive practices and press Congress to halt them,” said Dr. Campbell, who also is vice president of the Pennsylvania Society of Anesthesiologists and a state delegate to the American Society of Anesthesiologists (ASA).
Dr. Campbell described PADS as “a small group of physicians who met at the recent ASA meeting. After a totally unsatisfactory panel on drug shortages we chose to exchange emails and explore an economic explanation for drug shortages. Our solution will save at first $35 billion per year in health care costs. Once competitive forces are restored in the health care supply chain, even more savings will be realized.”
Any attempt to link GPOs to drug shortages is an “irresponsible and dangerous distraction,” countered Curtis Rooney, president of the Healthcare Supply Chain Association (HSCA), a trade association representing 14 GPOs, including the nation’s five largest. “The true cause of drug shortages is manufacturing problems, disruptions and barriers to entry in getting new suppliers online when there is a disruption in supply. The fact is that GPOs are taking a variety of creative and innovative steps to reduce drug shortages,” Mr. Rooney told Anesthesiology News.
Leveraging Purchasing Power
GPOs negotiate contracts with manufacturers and vendors of pharmaceuticals and other medical products on behalf of their customers, typically hospital groups and other large health care organizations. About 72% of all hospital purchases are made through GPO contracts.
Continue reading here
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