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FOR IMMEDIATE RELEASE
Contact: Carolyn Hickey
Phone: 703-243-9262

Arlington, VA (October 4, 2004) - The Health Industry Group Purchasing Association (HIGPA) opposes the Medical Device Competition Act of 2004 (S. 2880), as introduced by Senators Mike DeWine (R-OH) and Herb Kohl (D-WI), chairman and ranking member, respectively, of the U.S. Senate Judiciary Subcommittee on Antitrust, Competition Policy and Consumer Rights. This legislation is counterproductive to the shared priorities of the Senators and the industry of ensuring health care providers access to the best products at the best price.

The public policy goals outlined in S. 2880 are the same founding principles of health care purchasing organizations—encouraging competition and innovation in the hospital supply and medical device markets, and reducing the cost of health care as a result of aggregating buying power. However, legislation is the wrong avenue to pursue these goals.

HIGPA's Code of Conduct, adopted in 2002, is working and emphasizes the group purchasing industry's commitment to improving health care and advancing technological innovation at the most manageable costs to providers of care and their patients. HIGPA's Code focuses on several areas:

• Promoting competition and innovation;
• Eliminating the potential for conflicts of interests;
• Ensuring open communications between members and vendors;
• Establishing guidelines for the use of contracting tools; and
• Providing transparency by requiring full disclosure to members of all vendor payments.

The health care purchasing industry continues to engage in vigorous examinations of ways to improve and strengthen our certification and compliance process. HIGPA does this because we strongly believe private sector compliance programs are the most efficient and effective way to advance best practices in hospital supply purchasing. Ultimately, such compliance programs strengthen our health care system.

Hospitals and health care providers are the real test of the seriousness of the industry's Code and accompanying compliance program. If the GPO's provider members are unhappy with the way their contracting agent is operating they can freely switch to a different GPO or purchase on their own.

As always, HIGPA is committed to working with Senators DeWine and Kohl and others in Congress. HIGPA looks forward to continuing our discussions on non-legislative solutions that might lead to possible enhancements to the HIGPA Code of Conduct and/or ways we might strengthen the Code's enforcement.

HIGPA is a chartered trade association of over 160 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.

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