Key Takeaways
Valify’s subject matter experts help healthcare organizations turn spend data into actionable cost savings. They provide specialized category knowledge, benchmark interpretation, supplier-market insight, contract evaluation, negotiation strategy, implementation support, and savings validation. Combining technology, analytics, and expertise enables organizations to prioritize opportunities, balance cost with quality and operational needs, execute changes, and sustain savings.
The Role of Subject Matter Experts in Healthcare Cost Optimization
Healthcare organizations manage purchased services across clinical, operational, financial, IT, and facility categories. These services can involve different suppliers, contracts, pricing models, service requirements, and stakeholders, making cost optimization more complex than simply reviewing spend.
Valify’s purchased services can represent 40–60% of non-labor expenses, while many categories remain fragmented or unmanaged.
The challenge is not only identifying a category that costs more than expected. Organizations also need to understand why the difference exists, determine what action makes sense, implement the change, and verify whether savings are actually realized.
This is where subject matter experts (SMEs) add value. Data shows where to look; expertise helps determine what to do next.
Why Healthcare Cost Optimization Requires More Than Spend Data
Purchased Services Are Highly Specialized
Purchased services are different from standardized supply categories. Physician staffing, EVS, waste management, IT, laboratory services, linen, and facility maintenance all have different:
A benchmark can identify a variance, but it may not explain whether that variance is justified.
The Same Price Does Not Always Mean the Same Value
Two contracts may have different prices because they provide different service levels, geographic coverage, staffing requirements, response times, technology, or quality standards.
An SME can help determine whether a higher-cost agreement provides additional value or whether the organization is paying more than necessary. This is especially important for clinical and patient-facing services, where cost must be considered alongside quality, safety, and continuity.
Where Subject Matter Experts Add Value
Turning Analytics Into a Prioritized Opportunity
Technology can identify fragmented, rogue, off-contract, and high-benchmark spending. Valify combines technology with subject matter expertise to help identify these opportunities.
But not every opportunity should receive the same attention. SMEs can help prioritize categories based on:
- Spend size
- Potential savings
- Contract timing
- Supplier concentration
- Operational complexity
- Implementation requirements
This allows healthcare organizations to focus resources where further action may have the greatest impact.
Understanding the Supplier Market
Identifying a cost issue is only part of the process. Organizations also need to understand the supplier market and determine whether the right response involves an existing supplier, competitive bidding, an aggregated sourcing event, or another strategy.
Valify’s broader model combines benchmarking, supplier intelligence, sourcing, contracting, and advisory services to help move opportunities toward action.
Evaluating Contracts Beyond the Price
Contract optimization is not simply about requesting a lower rate. SMEs can review:
- Rate structures
- Escalation clauses
- Renewal provisions
- Termination language
- Service-level agreements
- Volume commitments
- Compliance requirements
This broader review can reveal opportunities that may not be visible from invoice data alone.
How SMEs Help Healthcare Organizations Negotiate Better Outcomes
Build the Right Negotiation Position
A strong negotiation starts with facts. Spend history, benchmarks, supplier performance, contract terms, and market intelligence can establish the organization’s position.
An SME can then determine where genuine negotiating leverage exists and whether renegotiation, an RFP, supplier consolidation, or another approach is appropriate.
Create Competitive Supplier Pressure
In some categories, competition can improve purchasing leverage. SMEs can help determine when an RFP or sourcing event makes sense and whether purchasing volume can be combined.
A 2025 Journal of Public Economics study found a one-standard-deviation increase in GPO scale was associated with a 2.7% reduction in average hospital supply expenses. The study estimated approximately $48 per discharge and $0.72 million annually per hospital in its model.
Importantly, this research concerns hospital supply expenses and GPO scale, not purchased-services advisory or technology. It does, however, provide broader evidence that purchasing scale and supplier access can influence cost outcomes.
Balance Cost With Service Requirements
Cost optimization should not automatically mean selecting the lowest-priced supplier.
Healthcare organizations also need to consider:
- Quality
- Continuity
- Service levels
- Patient experience
- Operational requirements
SMEs help evaluate these factors alongside price when developing sourcing and contracting strategies.
From Negotiated Savings to Implemented Savings
Negotiating an improved contract is only one stage of cost optimization.
Contract Execution
A negotiated rate does not automatically change what facilities pay. Teams may still need to execute agreements, transition suppliers, communicate changes, and coordinate implementation.
Standardizing Where It Makes Sense
Multiple facilities may have different suppliers or individual agreements for similar services. An SME can determine when consolidation or standardization makes sense and when local requirements justify maintaining different arrangements.
Tracking Whether Savings Actually Materialize
The final question is whether negotiated savings appear in actual spending.
Valify states that monthly data updates are used to track and validate realized savings. Ongoing monitoring can help identify changes in spending and contract compliance after an initiative has been implemented.
A Real-World Example of Expertise Closing the Gap
Our case study shows how expertise can connect fragmented data with implementation.
A health system operating dozens of hospitals across different MMIS environments had difficulty analyzing spending centrally. Multiple vendors and facility-specific contracts also created inconsistent agreements.
Valify consolidated facility-level spend data and benchmarked categories to identify opportunities. Two categories were prioritized based on high spend and multiple vendors: print management and elevator maintenance.
The health system achieved:
- $2.4 million in print-management savings on $18 million of annual spend
- $1.2 million in elevator-maintenance savings on $3.1 million of annual spend
- New contracts transitioned in 90 days instead of the expected 120+ days
The example demonstrates the complete process:
What to Look for in a Healthcare Cost Optimization Expert
Healthcare-Specific Category Experience
General procurement experience can be useful, but purchased-services optimization requires an understanding of healthcare’s operational environment and the specific categories being addressed.
Access to Relevant Benchmarking
Experts should be able to compare spending and contract performance against relevant market information.
Our benchmarking database includes more than $1 trillion in categorized spend and more than 1,400 hospitals across the nation. Its platform covers more than 1,400 unique purchased-services categories.
Contracting and Sourcing Capability
Expertise should extend beyond identifying opportunities.
Organizations should understand whether the team can support RFPs, negotiations, contracting, supplier transitions, and implementation.
Ongoing Savings Management
Optimization should not stop when the contract is signed.
A sustainable program should monitor:
- Contract compliance
- Spend changes
- Vendor performance
- Renewal timing
- Preferred-vendor utilization
- Realized savings
This is where analytics and ongoing expertise can work together to keep savings initiatives on track.
The Valify Approach: Technology Plus Expertise
Valify’s approach combines technology with human expertise rather than treating either one as sufficient on its own.
The complementary roles can be viewed as:
- Spend analytics: Establishes visibility into purchased-services spend.
- Benchmarking: Provides market context.
- Sourcing: Creates supplier competition and identifies alternatives.
- Contracting: Converts opportunities into agreements.
- Advisory: Provides category expertise, stakeholder alignment, and implementation support.
- Ongoing monitoring: Helps track and validate results.
Valify offers a full-service approach spanning expense-management technology, advisory services, benchmarking, contracting, sourcing, and access to its supplier network. The company’s stated objective is to help healthcare organizations move from visibility and insights toward informed decisions and savings.
Conclusion: Expertise Turns Healthcare Cost Data Into Action
Healthcare organizations do not simply need more spend data. They need to understand that data within the context of suppliers, contracts, operations, and healthcare-specific requirements.
Subject matter experts help bridge the gap between “we found an opportunity” and “we know what to do about it.”
Sustainable cost optimization requires a combination of clean data, relevant benchmarks, category expertise, strategic sourcing, contract execution, and ongoing monitoring.
Technology can identify the opportunity. Expertise helps determine the right strategy. Execution turns the strategy into savings.
FAQs
When should a health system bring in a subject matter expert for cost optimization?
An SME can be useful when a category is highly specialized, involves complex contracts, has multiple suppliers, or requires expertise the internal team does not currently have.
Can healthcare organizations use internal procurement teams instead?
Yes. Internal teams understand their organization’s operations and requirements. External SMEs can complement the knowledge with additional category expertise, benchmarking, market intelligence, or implementation support.
How does an SME adapt strategies to different healthcare facilities?
SMEs can consider facility size, geography, utilization, supplier availability, contract terms, and operational requirements rather than applying the same strategy to every facility.
What information should a health system provide to a cost optimization expert?
Useful information includes AP spend data, vendor information, contracts, pricing, utilization, service requirements, supplier performance, renewal dates, and operational constraints.
How can organizations evaluate whether an expert is delivering lasting value?
Organizations can track implemented savings, actual post-contract spend, contract compliance, supplier performance, implementation timelines, and whether savings continue after the initial initiative.
The Valify Editorial Team is dedicated to sharing insights, strategies, and innovations that help healthcare organizations gain control of purchased services spend. Backed by years of expertise in data analytics, procurement, and healthcare technology, the team curates practical resources and thought leadership to guide hospitals and health systems toward greater efficiency and savings. By combining industry knowledge with real-world case studies, the Valify Editorial Team delivers content that empowers decision-makers to drive smarter, data-driven sourcing strategies.
