SUCCESS STORY | Customized Solutions 

From Proposal to Best Practice: Intalere and Stratum Med Work with Physicians’ Clinic of Iowa to Create and Deliver a Comprehensive Contract Management Tool

The Challenge

Stratum Med Inc. is a unique non-acute care consortium corporation founded in 1996 by nine successful Midwestern medical groups in order to advance the quality of care, improve financial performance and optimize operational efficiency by sharing best practices and leveraging collective buying power. Today, more than 6,000 physicians from 50 healthcare organizations across the nation are cooperating shareholders for Stratum’s distinct line of products and services. Specializing in group purchasing, insurance and professional recruitment, Stratum has worked exclusively as an Intalere affiliate for more than 20 years, creating a virtual integrated delivery network that provides the type of favorable volume discount pricing typically reserved for hospitals to independent non-acute providers.

The purchasing coordinator for one of Stratum’s valued clients, Physicians’ Clinic of Iowa (PCI) in Cedar Rapids, a private, multispecialty group of 75 board-certified physicians, surgeons and mid-level providers, approached Lisa Pellum, executive director of purchasing for Stratum, with some basic but critical questions concerning the administration of their Intalere portfolio. In particular, during an accounting review, PCI discovered they had not signed all of the Letters of Commitment (LOCs) necessary to maximize savings on the Intalere portfolio products and services they were purchasing through Stratum Med. They were unable to locate LOCs for several key items in their pharmacy department and realized, as a result, PCI was not receiving the best tier pricing available under their Stratum agreement. They also discovered alignment was missing between sales reporting and contract paperwork for products and services in other departments. PCI undertook a project to compare the sales and forms data for each contract and discovered that a single source for the required information, as well as vital statistics such as expiration dates, geographical service exclusions or availability of value-added services such as on-site training or discounted shipping, was not available. What was ultimately needed, was a proof source to confirm PCI was taking full advantage of all the savings opportunities and supplier services Intalere had to offer under their Stratum Med agreement.

Pellum did not have easy answers. “I personally manage more than 1,200 contracts in the Intalere portfolio for every one of our clients,” she explained, “and there was no clear way for us to ‘prove a negative’.” While the savings generated with Intalere contract utilization were evident and easily documented using the standard sales reports available on the Intalere Member Resources website, without manually examining each facility’s spend line-by-line and comparing it to every active agreement in the portfolio, it was impossible to discover what may be missing. “What we really needed was an easy way to aggregate the data from various Intalere sources into a single report unique to PCI’s contract utilization and spend in order to track outstanding LOCs and highlight exceptions in order to determine if savings were being maximized by every one of our facilities.”

The Solution

Pellum contacted Intalere Inside Sales Manager Jennifer Geronaitis looking for a solution. “Our Intalere Member Services team immediately compiled and delivered the LOC data requested by Stratum and PCI, but it was apparent a more efficient methodology was necessary and we felt certain Stratum Med would benefit from access to a comprehensive contract utilization reporting tool that would navigate the wealth of information and data already available from Intalere in various formats,” Geronaitis explained. “We also wanted to make it easier for Intalere affiliates like Stratum Med and our IDN-based members to generate data discerning ‘parent’ and ‘child’ accounting and paperwork.” Geronaitis brought Pellum together with Intalere’s executive leadership, contracting and IT teams to propose the creation of a new Intalere reporting tool that would expand contract management capabilities for PCI, as well as affiliates and members nationwide.

The Outcome

As a result of Intalere’s collaboration with the Stratum team, an individualized Intalere Timesaver Report was able to be developed for Stratum Med that, in seconds, generated a real-time, multi-dimensional snapshot of the organization’s overall or facility-specific client portfolio status. The report provided customizable, comprehensive and essential contract management information including eligibility, LOC intelligence, posted sales history and standardization, as well as essential reference materials such as contract numbers, expiration dates and geographical availability—all filtered by the end-user’s choice of product category, supplier or other contract-specific description parameter.

Utilization of the Timesaver Report by PCI and Stratum Med brought immediate and dramatic results. Using the new Timesaver Report, PCI discovered 64 unsigned LOCs at just one clinic that saved them $370,000.

Pellum then utilized the Timesaver Report to examine other Stratum Med client clinics and identified 431 contracts worth $4.7 million at ten other facilities with incomplete or incorrect contract paperwork. Stratum took action and six months later, thanks to the Timesaver Report, only 89 improper contracts remained: a 95 percent or $3.5 million improvement.

Additional worth was realized via the convenience and efficiency afforded by the availability of a single-source document. “The value of the Timesaver Report is so much more than the financial improvements it has helped us realize. It really has become my desktop purchasing reference,” she said. Stratum has also used the Timesaver Report as a strategic financial management tool for benchmarking and forecasting. “Being able to provide detailed analytics has helped us attract new business,” explained Pellum.

Based on the success of the Timesaver Report at Stratum Med, Intalere’s leadership decided to take the tool nationwide, making the same custom comprehensive reporting capability available to every member and affiliate served by the organization. “Intalere is honored to have been able to collaborate with PCI and Stratum Med on the development and implementation of this reporting solution now available for use companywide,” said Geronaitis. “In today’s healthcare industry, many organizations face the same type of day-to-day challenges. Intalere is committed to sharing our innovations, best practices and success stories to help reduce costs, increase efficiency and improve the quality of care.”

“In all honesty,” said Pellum, “I never thought a project of this magnitude brought to the table by a single facility would be entertained, let alone completed in a few months. I was so impressed the Intalere organization listened to our needs and delivered a unique solution.”