History of GPO’s

Group Purchasing Organizations in healthcare came into existence in 1910.  The concept of group purchasing is seen throughout the economy.  The purpose of a GPO is to help businesses by leveraging the power of community with local vendors.  By funneling the purchasing power of a larger organization to select vendors, the group benefits as a whole by the relationship.  GPO’s provide hospitals and other health care providers the ability to use fundamental economic principles to reduce the cost of purchasing products and improve the quality of care.

GPO’s collective bargaining power provides both tangible and intangible benefits to its members.  The administration of the GPO creates, maintains and nurtures the vendor relationships on behalf of its members.

GPO’s create a community which is strengthened by common practices and common goals.  Not only do GPO’s negotiate rebates and discounts with wholesalers, they can provide a means to send out a centralized message to its constituents.  Whether sharing the latest news and information in regard to regulatory compliance, medical policy,  or providing educational CME’s to its members, the GPO is not just a network but a community working towards common goals.