Hello National Accounts Executives,
Welcome to the only newsletter dedicated to helping you succeed in contracting with GPOs, IDNs and RPCs!
Thanks to all of you that joined our LinkedIn group! We doubled the size of the group in just one week!
John Pritchard
jpritchard@ShareMovingMedia.com
(770) 263-5262
Enjoy back issues of National Accounts Weekly by clicking
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First Annual National Accounts Compensation Survey available free!
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The first Annual National Accounts Compensation Survey is now available for free! All you have to is go to the National Accounts Weekly LinkedIn group and request a Free download.
Here is a link to the National Accounts Weekly LinkedIn Group!
This survey is about 22 months old and we are currently updating so you will have a 2-year composite of compensation levels, trends and amount of responsibilities your peers are seeing.
We will have the updated survey out in early 2019!
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New York Times
story on consolidation doesn’t tell the full story
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“When Hospitals Merge, Patients Often Pay More” doesn’t paint a full picture of the root cause of higher health care costs to consumers. For example, the article’s findings are inconsistent with a recent study in
Health Affairs
that concluded that insurers are responsible for health premium growth (50% higher). A recent lawsuit filed in Florida is indicative of the lack of competition among commercial insurers. The suit against a health insurer that controls 75 percent of the state’s market, claims anticompetitive behavior for trying to keep a new innovative competitor out of the market in order to maintain market dominance.
In addition,
an economic study from Charles Rivers Associates
showed that hospitals were able to cut annual operating expenses by 2.5 percent per patient admission after a merger or acquisition. At the same time, hospitals and health systems have slowed price growth to under 2 percent during each of the last four years, despite the fact that government programs do not cover the cost of care.
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Sales reps may be wearing out their welcome in the operating room
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In the operating room, surgical masks and matching scrubs can make it hard to tell who’s who — at least for outsiders.
Patients getting wheeled in might not realize that salespeople working on commission are frequently present and sometimes even advise the clinical team during surgery.
Who are these salespeople, and why are they there?
The answer to the first question is pretty easy. These sales reps typically work for medical device companies, such as Stryker, Medtronic or DePuy Synthes. Many surgeries, especially orthopedic trauma and cardiac procedures, require insertion of artificial joints or other hardware manufactured by these companies.
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Will Amazon role out Prime Health?
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John Doerr made a fortune for his venture firm through an early investment in
Amazon
, when it was just an online bookseller. More than two decades later, he’s betting the company is preparing for a big move into health care.
Speaking at the
Forbes Healthcare conference
this week, Doerr said Amazon is among the best-positioned companies to take information its learned from customers and use it to their benefit. He’s expecting CEO
Jeff Bezos
to roll out an offering for medical and health products that resembles Amazon Prime, which has over 100 million users.
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Medical Monopoly
Group Purchasing Organizations are charged with saving hospitals money, but special carve-outs from Congress, a closed and secretive marketplace, and the ability to collect fees and pay rebates all serve to drive up costs for patients.
The price of a replacement knee from a supplier can cost a hospital around $250, but a hospital can turn around and charge a patient more than $5,000 for the same implant prior to surgery.
As politicians and industry experts struggle to contain the country’s spiraling health care prices, a simple metal screw available in any metro Detroit hardware store illustrates the ever-escalating costs consumers, patients, and insurance companies pay for hospital care.
The common screw is identical to ones produced free of bacteria, packaged, and sold in kits of four that are used in spinal reconstruction surgery.
Recent invoices provided by a Northville-based supplier show the company pays a manufacturer $50 per screw. The supplier marks up each screw to $800 and sells them to hospitals. The hospitals, in turn, charge as much as $2,400 per screw and bill that amount to insurance companies.
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The gray market and medical supply distribution
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Gray market is defined as “the redirection of authentic product to unauthorized distribution channels” and is legal in the U.S. and E.U. The gray market exists because it is profitable for medical supply distributors (typically 20 percent to 40 percent more in additional profit) vs. acquiring the same product directly from the manufacturer. Virtually all distributors in the U.S. and many health care facilities purchase product from the gray market.
How gray market product is acquired
There are three primary methods that gray market product is acquired: product theft, diversion or counterfeit.
- Product theft. Product is initially “acquired” by one of these methods, sold to a diverter (a.k.a. Alternative Supply Vendor), then sold to an authorized medical supply distributor or directly to a medical facility. Hospital staff and warehouse personnel, including clinicians, have been prosecuted along with manufacturer and distributor sales representatives for theft.
- Diversion. An example of product diversion is when a product is earmarked for sale outside the U.S. (OUS), diverted back to the U.S., or it never makes it out of port.
- Counterfeit. The gray market is the avenue of choice by counterfeiters as the easiest way to get their products into the healthcare marketplace. In fact, since 2005, every case of counterfeit product prosecuted by the F.B.I. has entered the supply chain system through the gray market. Some samples of counterfeit product include; implantable devices, blood glucose test strips, contact lenses and numerous pharmaceutical products.
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Join ANAE for 2019 for only $295, benefits detailed below
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The Association of National Account Executives is a member driven organization built specifically for National and Corporate Account Executives. Healthcare Supply Chain is more complex than ever which means your customer is more complex. ANAE gives you an opportunity to interact, network and build relationships with your customers so you understand their goals and needs to make you better equipped to serve them.
ANAE Members Receive:
- Access and recordings to our monthly interactive webinar with a supply chain leader
- Registration discounts to all Journal of Healthcare Contracting meetings
- Attendance to ANAE regional events
- Access to a community of other National Account Executives where you can ask and answer questions about your challenges and successes
- Access to our online library of content, including industry training, conference presentations, and topic specific blog posts
2019 ANAE Reports, White Papers and Content that only members will receive:
- Understanding the benefits and inner-workings of contracting through GPOs
- 7 things every supplier needs to understand working with IDNs
- Video Series: IDN Spotlights
- Importance of Health IT and Cybersecurity webinar
- Consequences of M&A and Consolidation webinar
- Negotiation tactics webinar
- Best practice for corporate account teams
- The ultimate resource guide to RPCs
- 7 essential characteristics of the National Account Executive of the future
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Thanks for reading this issue of National Accounts Weekly! Let me know what you think!
You are now in the know!
John Pritchard
P.S. You can follow us on twitter @NatAcctWeekly
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