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Cost Reduction for a Large Health System in the Southwestern United States

By
Matt Cauller
|
Dec 31, 2024
|
Healthcare - Medical Waste

A prominent health system in the Southwest United States was grappling with inconsistencies in medical waste pricing across its multiple locations. Larger quantity generation sites were subject to unfavorable rates, while smaller sites suffered inconsistent pricing and often faced incorrect billing. To tackle these pressing issues, the health system engaged Mobilia Consulting to optimize its medical spend and streamline its procurement processes.


Mobilia Consulting's approach was systematic and focused, demonstrating its expertise and thoroughness. It aimed to analyze the medical waste vendor accounts thoroughly to identify pricing discrepancies, negotiate better pricing agreements for large quantity generation sites, standardize billing practices to ensure accuracy and recover overpaid amounts due to incorrect billing. The process began with a comprehensive spend analysis involving a detailed review of each location's invoices, contracts, and usage reports. This revealed significant pricing discrepancies and billing errors that were inflating the health system's costs.


Mobilia Consulting used industry benchmark data to identify best-in-class rates, terms, and conditions with the current vendor. This information was pivotal in negotiating optimized agreements with the supplier. The negotiations secured favorable rates for large-quantity generation sites and established standardized pricing across all locations, ensuring uniformity and fairness without changing the vendor or service.


Mobilia Consulting assessed current practices and implemented cost-effective and efficient solutions to address solid waste management. The enforcement and recovery phase involved implementing the newly negotiated agreements across all satellite locations, auditing past invoices, and identifying overpayments. The successful recovery of significant refunds provided a substantial financial benefit to the health system.


Mobilia Consulting ensured the long-term sustainability of these savings by auditing medical waste invoices moving forward. This proactive approach allowed for continuous monitoring and verification of the newly implemented pricing and billing practices, ensuring that the health system consistently benefited from the negotiated savings and avoided future discrepancies or errors.


The results of Mobilia Consulting's intervention were substantial, underscoring the success of their approach. The health system achieved an annual cost reduction of approximately 22%. Overpaid amounts totaling $234,000 were identified and successfully recovered, providing a significant refund to the health system.


In conclusion, Mobilia Consulting enabled the large health system in the Southwest to achieve significant cost savings. By leveraging industry benchmark data to negotiate best-in-class pricing and terms, standardize billing practices, optimize medical waste vendor management, and recover overpayments, the health system is now better positioned to effectively manage its medical waste costs. Through detailed spend analysis and strategic supplier negotiations, the health system has not only achieved immediate financial benefits but is also set up for sustainable financial health and efficiency in the future.