GPO lobby fights back against medical device report

The Group Purchasing Organization (GPO) lobby is pushing back — and hard — against a new study indicating that GPOs don't save hospitals money on medical devices.

“All independent, empirical and non-industry studies of GPOs — including examinations by the GAO, FTC, DOJ, academia and the 8th Circuit Court of Appeals — have found that GPOs save hospitals money," Curtis Rooney, head of the Health Industry Group Purchasing Association (HIGPA), said in a statement.

The new report, released Wednesday by the Medical Device Manufacturers Association (MDMA), found that eliminating a decades-old anti-kickback exemption for GPOs — which allows them to accept fees from device makers — would save hospitals as much as $37.5 billion per year, while cutting taxpayer costs by $11.5 billion.

“It is painfully clear that while hospitals and providers are trying to improve care and reduce costs for patients, the supplier-funded GPO model is costing the healthcare system billions,” MDMA CEO Mark Leahey said in a statement. 

Not so, says HIGPA's Rooney, implying that the findings were colored by the device industry's backing of the research.

"An MDMA-funded ‘study’ suggesting that device manufacturers would voluntarily reduce their prices and their profit margins under a new GPO model is a slap in the face of the more than 90 percent of America’s 5,000-plus hospitals that use GPOs," Rooney said. "The device industry attacks GPOs because we are working for hospitals." 

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