The country's biggest Catholic and nonprofit health system has formed its own group purchasing organization.

Ascension Health Alliance said Friday its newly created subsidiary Resource and Supply Management Group LLC formed a GPO after its plan got a nod from the office of the inspector general. The group's nationwide network of 37 health ministries, a collection of hospitals and health systems, will make up members of the GPO, Ascension Health said, although other health care facilities can join it.

"As participants of the GPO, the ministries of Ascension Health will see immediate benefits such as lower costs on purchased services, capital and professional services," Robert J. Henkel, president and CEO of Ascension Health and executive vice president with Ascension Health Alliance, said in a statement. "Longer term, the GPO demonstrates our commitment to transform health care by 2020."
GPOs are middlemen that use the bulk purchasing volumes of multiple facilities to help negotiate lower prices from suppliers and manufacturers.

Ascension Health has an operating revenue of $15.5 billion, according to its 2011 annual report, and runs more than 500 locations nationwide. The group also spent about $1.2 billion in care for the poor and community benefits, according to the report.

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