Congressional Deliberations of GPO Operations

Abstract

On April 30, 2002, the Senate Committee on the Judiciary Subcommittee on Antitrust, Business Rights, and Competition held its first hearing on the topic of Group Purchasing Organizations (GPOs). In his opening remarks Senator Herb Kohl (D-Wisconsin) stated:

This subcommittee turns its attention to an issue affecting the health and safety of every American who has ever or will ever need treatment at a hospital, in other words, every one of us. This issue is how hospitals form buying groups to purchase nearly everything used by hospitals.… These buying groups, known as group purchasing organizations, or GPOs, are at the nerve center of our health care system. Because they determine what products are in our hospitals, they directly affect patient health and safety. Because they control more than $34 billion in health care purchases, they impact the cost we all pay for our health system. Because they represent more than 75% of the nation’s hospital beds, they are a powerful gatekeeper who can cut off competition and squeeze out innovation.¹