Arlington, VA (September 26, 2003) - It continues to perplex the members of the Health Industry Group Purchasing Association (HIGPA) that health care providers are continually left out of the ongoing group purchasing organization (GPO) debate, the very entities who are the customers of GPOs, said Robert Betz, Ph.D., president and CEO of HIGPA in submitted testimony to the U.S. Federal Trade Commission for their September 26 hearing on health care group purchasing. Hospitals and other types of providers should have been included in the April 30, 2002 and the July 16, 2003 Senate Judiciary Antitrust Subcommittee hearings, as well as today's Federal Trade Commission and the Department of Justice's Joint Hearings on Health Care and Competition Law and Policy, Betz asserted.

In written testimony, HIGPA briefed the FTC on the Association's newly adopted GPO Code of Conduct-which promotes competition, eliminates potential conflicts of interest and provides cost savings to providers. Additionally, Dr. Betz detailed the importance of GPOs to providers and furnished examples of hospitals and other provider organizations agreeing with this belief. Specifically, the testimony highlighted recent reaction by California providers opposing state legislation which would weaken the GPO business model, in addition to hospital executives testimony outlined in a May 2003 Lewin Group report.

Dr. Betz warned the FTC that the ripple effect of restricting GPO contracting practices will ultimately affect federal administered health care programs. In support of this prediction, Dr. Betz highlighted a September 2002 Muse & Associates study stating, "Providers, payers and ultimately, consumers will pay more for products and services purchased through GPOs if their ability to negotiate on behalf of their providers is curtailed by additional restrictions on the GPO contracting processes."

In closing, Dr. Betz stated, "I urge the FTC to act with caution and not weaken a crucial mechanism that promotes competition and helps providers reduce their purchasing costs which allows them to commit more financial resources to patient care."

HIGPA is a chartered trade association of over 170 health care purchasing and supply chain organizations. HIGPA's Industry Members include purchasing groups, associations, and health care provider alliances. HIGPA's Trading Partner members include many of the world's leading health care product manufacturers, distributors, wholesalers and related suppliers. According to a recent study conducted by a former principal analyst at the Congressional Budget Office, hospitals save patients over $30 billion each year by purchasing products through group contracts.

To learn more about HIGPA or the group purchasing industry, visit www.higpa.org or call 703-243-9262.

Return to Press Room