Category: Purchased Services

Artificial Intelligence (AI) is changing how healthcare organizations manage operations and improve financial health.

In purchased services, hundreds of vendors and service lines compete for attention. AI cuts through the noise. It gives teams instant clarity and control.

At Valify, we use AI to help healthcare systems streamline procurement and boost efficiency. Most importantly, we help customers find hidden cost savings like never before.

The challenge: complexity in purchased services spend

Purchased services are often one of the most overlooked and complex areas of hospital spend. When sourcing is scattered across vendors and departments, it’s hard for healthcare organizations to see the full picture.

“Managing and centralizing purchased services, which can include multiple vendors across hundreds of categories, is incredibly complex,” explains Les Popiolek, CEO of Valify.

For many healthcare leaders, simply understanding where they stand is half the battle. Without centralized data, it’s harder to make quick, confident decisions. Supplier relationships become harder to manage. And valuable savings often slip through the cracks.

AI as the game-changer: from data overload to actionable insights

Traditional data analysis methods often involve cumbersome spreadsheets and disjointed reports. While these manual processes can get teams by, they are time-consuming and don’t always deliver the full picture.

As Popiolek puts it: “Without understanding exactly where your organization stands on purchased services spend, managing these services in a cost-effective and efficient manner is impossible.”

Valify’s AI-powered platform solves this problem by organizing and analyzing spend data. Using advanced AI, Valify turns complex data into clear insights that healthcare leaders can trust.

How Valify’s AI Spend Insights helps healthcare teams win

The introduction of AI Spend Insights marks a major step forward for healthcare procurement teams.

AI Spend Insights is built to be simple and intuitive. Users can ask plain-language questions and receive clear, summarized answers without needing advanced training.

With AI Spend Insights, you can:

• Spot high-cost areas across service categories
• Find hidden vendor or contract redundancies
• Benchmark spend against peers in real time
• Speed up sourcing decisions with confidence

“With AI, we are able to expand the power of our analytics to executives and other users who do not use Valify on a daily basis by adding features like AI Spend Insights,” says Rick Mattock, Director of Product Management at Valify.

Data security you can trust

As AI adoption grows across industries, data security remains a top priority. This is especially true in healthcare. Valify’s AI integrations are designed with security in mind, keeping client data safe and confidential.

Valify’s approach prevents external AI providers from using client prompts or outputs to train future models. Healthcare systems can trust that their procurement data stays within Valify’s secure environment.

Delivering more value, faster

Valify’s AI is built into every layer of the platform. From user experience to data enrichment and acquisition, these tools help healthcare systems work faster and smarter.
For healthcare supply chain leaders, this means:

• More time back for high-value strategic initiatives
• Less time spent on manual data processing
• Stronger supplier management through clearer spend visibility
• Increased savings from faster identification of cost-reduction opportunities

“We are advancing Valify’s AI capabilities to deliver unique insights and automated solutions, differentiating the platform from competitors,” adds Mattock. “While data itself is essential, it’s the strategic application of advanced AI that unlocks deeper insights and drives meaningful change for healthcare leaders.”

Why AI matters for healthcare procurement leaders

AI is here to stay. Organizations that embrace it will move faster and operate leaner. By applying advanced analytics to your purchased services data, you unlock powerful benefits. You gain a deeper understanding of spend patterns, contract efficiencies, and vendor performance.

Valify’s AI does more than automate tasks. It gives healthcare teams the confidence to make smart, data-driven decisions that reduce costs and improve operations.

Learn more about Valify’s AI and spend management tools

Want to take your organization’s purchased services strategy to the next level? Check out more of Valify’s solutions:

• Custom Contracting: Tailor your sourcing to your organization’s needs
• Benchmarking Tools: See how your spend stacks up against peers
• Aggregate Sourcing Events: Leverage the spend and volume of members to drive value for group RFPs

Ready to see AI Spend Insights in action?

We’d love to show you how Valify’s AI-powered tools can make an impact for your organization.

Schedule a demo today. See firsthand how we help healthcare teams reduce costs, work smarter, and take control of their purchased services.

In the realm of healthcare procurement, data is king. For more than a decade, Valify has been a leader in purchased services data analytics. Yet, within this domain lies a paradox: while having data is a required step to make measurable progress on purchased services cost reduction, too much data can present a paralyzing challenge. This article delves into the challenges faced by healthcare systems, the evolving role of artificial intelligence (AI), and how integrating data with AI can lead to significant savings.

Aren’t We a Data Company?

Throughout our tenure, Valify has maintained its reputation as the gold standard in purchased services data analytics. Over the past decade, we’ve meticulously curated over $1 trillion in spend data, furnishing healthcare systems with invaluable insights into their financial landscapes. However, as we’ve labored alongside the professionals on the front lines, our users, we’ve always known one truth: while data serves as a cornerstone, achieving significant cost savings requires more than just numbers. It demands a strategic fusion of data, expertise, and manpower. The perennial question is what we can do as an analytics provider to empower our clients to make progress not just on the usual categories that everyone tackles, but on the full breadth of services spend?

What Are the Challenges?

The challenges confronting healthcare systems in managing their purchased services expenditures are diverse and complex. With an extensive range of over 1700 unique categories, it’s understandable that attention often gravitates towards the most visible areas of spending, such as food management or waste disposal. However, these categories only scratch the surface, with numerous smaller categories often overlooked and under-optimized. Adding to the complexity is the limited capacity of healthcare teams tasked with overseeing these expenditures. Despite their dedication, the sheer volume of data and the intricacies of sourcing across diverse categories can feel overwhelming. Moreover, time constraints further compound these challenges, as teams find themselves juggling competing priorities and struggling to allocate resources effectively.

AI and Its Potential

In recent years, the emergence of artificial intelligence has opened up exciting possibilities in the realm of data analytics. Powered by advancements in machine learning and natural language processing, AI holds the promise of revolutionizing how healthcare systems approach purchased services analytics. Imagine a world where teams can gain efficiency with machine-learning models that sift through the mountains of data, uncovering hidden opportunities for cost savings across various spending categories. With AI-driven algorithms that extract meaning from the data and present it in concise narratives, these teams gain valuable insights into vendor relationships and market trends, empowering them to make well-informed decisions that deliver substantial financial benefits for their organization. As we explore the potential of AI in this space, we anticipate new avenues for enhancing efficiency and driving impactful outcomes in purchased services analytics.

How Do We Solve This as an Industry?

The key lies in strategically integrating AI into healthcare procurement processes. Procurement teams must be equipped with AI-driven tools and insights that save them time by extracting valuable insights from the mountains of spend data. They need tools which speak their language to tell them the story behind the data, not just confront them with tables and charts. They need best in class software that serves as a force multiplier and which increases in value as they interact with it. And most importantly, these tools have to be built on top of pristine data – like that created by the tools, processes, and teams that Valify has worked hard to perfect over the last decade.

As we envision the future of purchased services analytics, it’s crucial to recognize that data alone won’t carry us forward. While data forms the bedrock of insights, it’s the strategic fusion with AI that will drive real progress. Through AI-driven analytics, healthcare organizations can break free from the constraints of conventional methods, unlocking new avenues for cost savings and efficiency. At Valify we’re leaning into this, and we’re excited to see how it will pave the way for a more sustainable future in healthcare procurement.

About the Author

Matt Clark is the Chief Technology Officer of Valify, responsible for the Valify products and the engineering organization. As a co-founder of Valify Matt is responsible for the initial design and development of the Valify products.

When providers think of purchased services, their minds typically go to facility support, IT, and ancillary services. However, this  scope is too limited and doesn’t encompass the full breadth of what falls under the definition of purchased services. The fact is, there are over 250 clinical services that are categorized as a purchased service including pharmacy compounding services, dialysis services, imaging services, and neurology services.

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Purchased services represents up to 45% of the non-labor expense budget within a health system. As more executives look to purchased services categories for potential expense reduction, 2018 is an important year, and Valify has several important innovations planned to assist clients in controlling and reducing purchased services expense in the year ahead:

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In part one of this two-part series, we stated that continual monitoring is the only way to ensure actual spend aligns with budgeting expectations. We discussed at length the many red flags, pitfalls, and common missteps on the path to successful and regular monitoring.

Though the process of tracking and monitoring expenses to find realized savings is difficult perhaps more difficult for purchased services than for any other area within a hospital below are best practices that have been proven effective.

In part two of this series, we discuss the top best practices and tips to make monitoring expenses easier, faster, and more successful.

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Unlike with tracking expenses for products and capital within a health system, purchased services are difficult to quantify. Purchased services have no item number, are primarily fulfilled by local vendors, and are purchased off-PO 75-85% of the time. These factors make purchased services a complex area in which to manage budgets, to track expenses, and to implement compliance without the proper tools and best practices.

If purchased services expenses are not monitored regularly, there is no guarantee health systems will see the savings that were planned for following a rigorous vendor negotiation. This can be defeating for those who spent the time and energy finding a better deal and can ultimately be bad for business when expected savings are missing on the bottom line at year end.

Continual monitoring is the only way to ensure actual spend aligns with savings expectations. Purchased services expense tracking and monitoring is an ongoing process with plenty of pitfalls and common missteps. However, purchased services professionals can make the monitoring process more manageable and productive by knowing the pitfalls to look out for and by following the industry best practices (see blog: Monitoring Purchased Services Expenses. Part 2: Best Practices and How to Get Started). Continue reading →

Healthcare purchased services have come a long way in the three years since we founded Valify. In that time, purchased services has transformed from a misunderstood budget area to a top financial savings opportunity and priority for healthcare organizations nationwide.

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