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Indirect Spend

Vizient Multimedia

Created on March 20, 2023

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Transcript

Characteristics of Indirect Spend and Purchased Services

Hospital operating expense breakdown

The decentralized nature of indirect spend means that there’s often hidden opportunities to decrease spend:
  • High areas of spend: 20% to 25% or more of total operating expense and consistently growing
  • Decentralized decision making and purchasing
  • Fragmented spend, sourcing and contracting
  • Minimal strategic vendor and category management
  • Limited or inaccurate benchmarking
  • Local and regional variations in pricing
  • Variation often does not map to bed size, acuity, service needs or geographical location as would be expected
Indirect spend
Revenue cycle accounts for 3% of a hospital's indirect spend expenses
Salaries and wages
Supplies
Learn how Vizient can help health systems across all indirect spend and purchased services categories.
Depreciation and amortization
Interest, bad debt and other
Watch a video about healthcare indirect spend and purchased services.

* Source: Vizient Savings Actualyzer data