According to the Healthcare Supply Chain Association (HSCA) a group purchasing organization (GPO) is an entity that helps healthcare providers and practices realize savings and efficiencies by aggregating purchasing volume to negotiate discounts with manufacturers, distributors, and other vendors.
There are over 600 GPOs in the US, which are unique in how they are structured. Oftentimes, GPOs rely on fees paid by vendors to finance their operations.
GPOs do not buy or purchase products; rather, they work to negotiate contracts for purchases that participating providers can benefit from. Depending on purchasing volume, GPOs can save practices a substantial sum of money.
Significant variability exists among GPOs. Some specialize in surgical supplies and equipment, others in bulk licenses for nursing homes. These vendors may not offer the best prices on medical supplies commonly used in a busy ambulatory pediatric practice.
Pediatric practices spend a considerable amount of money on purchasing vaccines. The AAP offers guidance of managing practice costs associated with vaccines, including a list of Physician Buying Groups and GPOs that provide discounts for the purchase of vaccines, as well as medical supplies, office supplies, and other services.
American Academy of Pediatrics