I just returned from Prodigo Solutions’ (Prodigo) user conference in Pittsburgh. It was the company’s second such gathering, as Prodigo is a relatively young firm. In case you’re not familiar with what Prodigo does, briefly, its tour de force is an internal marketplace application that provides an Amazon-like shopping experience.
However, and unlike other “marketplace apps,” ProdigoMarketplace is heavily nuanced to the needs of healthcare providers. In fact, all of the company’s solutions were designed and built to meet the specific needs of acute care hospitals and their extended care networks. It’s the company’s sole focus.
The conference was well attended. By the numbers, those in attendance represented nearly 25 thousand beds, a little less than $10 billion in spend and annual admissions in excess of 1 million. By the way, Prodigo’s newest customer, The Cleveland Clinic, is represented in those numbers, allowing Prodigo to now boast of having 7 of the U.S. News & World Reports Top 15 Honorees and 6 of the 7 care providers that made Gartner’s Healthcare Industry list of Top 25 Supply Chain Management performers.
Hey, but who’s counting. Here’s what caught my attention:
Prodigo demoed a new product, called ProdigoContracts. It is not a contract authoring tool, but a hub capable of storing and managing the pricing, terms and conditions of both GPO and locally negotiated provider/supplier contracts.
It fits perfectly with ProdigoMarketplace (fully integrated), as it enjoys a real time, line item level view of the point of sale. Put another way, ProdigoContracts establishes a means to continuously track and manage the purchasing activity in its marketplace against the contract details it stores and are meant to govern each transaction. It’s logical and actually, quite slick.
The system even allows GPO admin fees to be tracked and calculated on a continuous basis, providing a way –and for the first time that I know of– for hospitals to run ad hoc “share-back reports.” Obviously, the same goes for locally negotiated supplier discounts and rebates. As a Prodigo exec said, “if human beings can put it down on paper, then we can capture and manage it in our system.”
In addition, ProdigoContracts can be configured to deliver an alert when specified performance criteria are met, effectively closing a loop that has confounded both buyers and sellers for far too long. More than sending an email to the people who need to know when a discount is triggered; and more than updating the provider’s ERP with corrected pricing; the system’s event management capability can also be used to modify buying behavior. For example, if a lucrative rebate opportunity is hanging in the balance, not only can notifications be sent so the required buy is executed in time, but requisitioners can be enlisted to support the opportunity (e.g. increase their par levels for a specified period).
Surveys indicate that more than 65% of GPO contracts are undermanaged. In fact, providers live in a world where less than 60% of routinely purchased items are even bought under a valid contract, so by definition, rebates and discount opportunities are regularly missed. Simply put, via a straightforward forms-driven interface, ProdigoContracts allows users to parse and store conditional contract details and systematically relate them to the purchase performance of items so that savings opportunities aren’t missed.
With compliance tools like ProdigoMarketplace becoming increasingly mainstream, the addition of ProdigoContracts is a well timed addition. It not only closes the loop in terms of “partner performance,” but it provides both sides to an agreement an innovative means to audit contract performance –not 30-90 days in arrears, but at the speed of business.
While my takeaway on the company’s new contract management product is clearly favorable (I think they’ll do well with it), it’s also worth mentioning how productive a user conference can be when everyone in the room shares nearly the same interests and objectives. The wisdom of Prodigo’s decision to solely focus on the provider market was apparent during its user conference this week. Like minded people don’t just talk, they actually listen to each other.