GPO Controversy Surrounds Premier's Baldrige Award
BY LAUREN UZDIENSKI, DECEMBER 5, 2006
Each year, three Malcolm Baldrige National Quality Awards are given to companies that excel in "leadership; strategic planning; customer and market focus; measurement, analysis, and knowledge management; human resource focus; process management; and results." The GPO Premier, Inc. was one of the 2006 award recipients, and USA Today was quick to voice questions over the Baldridge panel's choice. GPOs have long been accused of suppressing competition and taking legal kickbacks from big device manufacturers, and the award came just one day after Premier was ordered to pay $8.8 million to Rochester Medical in an anti-compeition suit. It wasn't the first.
In 2003, Premier and two other defendants agreed to pay $55 million in a settlement with Retractable Technologies, who claimed Premier kept their VanishPoint syringes out of hospitals. Retractable CEO Thomas Shaw wrote a guest blog in September regarding his lawsuit against Premier, sharing in the pressure on Congress from small device makers to revoke the anti-kickback safe harbor law that protects GPOs.
Additionally, Premier CEO Richard Norling is on the board of directors at the Baldrige Foundation. He reportedly offered to resign his position, but the director of the Baldrige National Quality program claims there is no conflict of interest, because board members don't determine who wins.
Premier negotiates supply and service contracts worth $27 billion a year for about 1,500 nonprofit hospitals and thousands of other healthcare providers. They also remain the target of an ongoing Senate antitrust investigation. Charlotte Observer quotes MDMA Executive Director Mark Leahey, "It's very strange that of all the organizations in the country ... there aren't more worthy candidates for this award."
For more information on Premier, Novation and the legal and regulatory world of GPOs, please see past blogs as well as our GPO report.
