Top six GPOs accounted for $140 billion in purchasing volume in 2010

The supplies and non-labor services used in conjunction with the delivery of hospital care are estimated to account for approximately 30% of overall hospital costs.

These costs include commodity-type medical-surgical supplies, medical devices, branded and generic pharmaceuticals, laboratory supplies, food and nutritional products and purchased services.

Hospitals are required to purchase many different types of supplies and services as a result of the wide range of medical care that they administer to patients. Hospitals often rely on GPOs, which aggregate hospitals’ purchasing volumes, to help manage supply and service costs.

A small number of GPOs dominate the market for products sold through GPO contracts. Although there are over 600 GPOs in the United States, the six market-leading organizations are estimated to account for nearly 90 percent of all hospital purchases nationwide made through GPO contracts.

The 2010 GPO market leaders include:

Novation LLC $37.8 billion
Premier Inc. $36 billion
MedAssets/Broadlane $35 billion
HealthTrust Purchasing Group $17 billion
Amerinet $7.2 billion
PDM Healthcare $5 billion