The 2024 edition of our annual HGPII survey of the nation’s healthcare supply chain finds that GPOs remain focused on transparency and meeting industry standards as they implement AI, machine learning, and data analytics.

GPOs are adapting to ongoing industry hurdles by leveraging cutting-edge technologies and lessons learned from the pandemic, according to the Healthcare Group Purchasing Industry Initiative’s (HGPII) 18th Annual Report, released today.

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“This report captures and illustrates how healthcare GPOs are playing a dynamic role in bringing innovative products to the medical supply chain,” noted Congressman Phil English, National HGPII Coordinator. “HGPII’s members are actively supporting the pipeline for innovation for the American healthcare system. The industry is accommodating important medical breakthroughs and novel health products central to future practice while continuing to save money for the system.”

The Annual Report also outlines how the group purchasing industry is promoting transparency, compliance with ethical standards, supply chain diversity, and sustainability contracts. The report documents how the industry remains highly competitive.

The report, conducted by ArentFox Schiff, finds that GPOs are using data analytics, AI, and machine learning to overcome a host of challenges — including product shortages, soaring costs, high patient volumes, inflation, and the dependence on offshoring — all of which are expected to persist well into the future. These findings illuminate the crucial role that the nation’s GPOs play in delivering savings to their customers and reflect the lingering impact of the pandemic, its accompanying systematic retrenchment, and greater public interest in GPO activities.

“Dynamic GPOs have embraced digital transformation without sacrificing their commitment to accountability and rigorous guidelines set forth by HGPII—and that will go a long way toward combating global inflation and volatile supply chains,” said Senator Byron Dorgan, HGPII National Co-Coordinator. “Even as GPOs develop extensive initiatives that provide access to groundbreaking healthcare products, we’re certain they’ll continue to deliver the effective contracts that healthcare organizations have come to expect.”

By conducting interviews and reviewing member questionnaires, HGPII’s annual assessment of the healthcare supply chain also highlighted several encouraging developments:

An Embrace of Rapid Innovation

Increased Supply Chain Resilience

Harnessing New Technologies

“While the past year has been challenging for some GPOs,” said English, “we’re delighted to see that HGPII participants have reconfigured their operations to take advantage of burgeoning technologies like AI and machine learning, which can take the guessing out of supply chain management and procurement.”

In addition, GPOs have continued to advance initiatives that foster sustainability and diversity. They report expanding green purchasing contracts and are actively promoting environmentally preferred products to improve patient outcomes and the earth’s ecosystem. Building on their strong and well-established diversity programs, GPOs have also leveraged institutional health spending to create more equitable opportunities for minority-owned suppliers and HGPII members.

As a result of these developments, the GPO sector has continued to bolster, deploy, and promote breakthrough products, therapies, and services that are reshaping the healthcare marketplace.

HGPII was established in 2005 by nine major healthcare group purchasing organizations (GPOs) that pledged to adopt and implement a set of principles for business ethics and conduct centered on the healthcare supply chain industry. These best practices are shared at the HGPII Annual Forum and independently evaluated annually with the HGPII Annual Report.