Five (5) Critical Strategies for Managing Physician Preference Item (PPI) Costs within Hospitals

Written By

Keerthi Kanubaddi
Keerthi Kanubaddi

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For most hospitals, Physician Preference Items (PPI) represent a significant portion of the total supply costs—ranging from 40% to 60%. Given this substantial expenditure, hospital leaders must focus on PPI management strategies to contain costs effectively.

Cost-Saving Strategies

Below are five key strategies for managing implant costs:

Mindset Shift

  • Historical Perspective:  Clinicians have often viewed implants as “high-value” items, and focus on data-driven choices to balance cost and quality.
  • Engage Clinicians Early:  Shifting perspectives to include clinicians early in decision-making is crucial for optimizing PPI management.


  • Data-based Selection: Hospitals should involve physicians in product selection by presenting clear, evidence-based reasons, beyond just cost-saving.
  • Aligned Decisions: This collaborative decision-making ensures that choices align with both clinical efficacy and financial prudence.

Physician Engagement

  • Involve Physicians: Foster buy-in by involving physicians in the decision-making process, using data to demonstrate value.
  • Influence Through Leadership: Drive change and influence peers utilizing respected physician leaders.
  • Align Incentives: Motivate physician participation by aligning incentives, such as equipment purchases or improved OR efficiencies.

Implementation Strategies

  • Vendor Compression: Lower costs and standardize processes by reducing the number of vendors.
  • Capitation: Set price ceilings for implants constructs, which requires significant physician cooperation.

Technology and Data

  • Performance and Outcomes: Differentiate services and justify technology use by demonstrating performance results.
  • Robust Data Systems: Develop robust data systems for capturing and analyzing care metrics, driving informed decision-making.
  • Transparency: Ensure transparency in performance data, to influence both technology adoption and operational decisions.

The Full Picture

The first step in implementing a successful PPI Management strategy is to collect and analyze real-time inventory usage data. Transactional data from the ERP is insufficient as it lacks the necessary detail to reveal the correlation between PPI usage and specific patient conditions.

Implementing a point-of-use scanning tool that can track the PPI serial/lot number, expiration date, location, and final disposition (used in case, wasted, etc.) is essential. This allows PPIs to be tracked through their entire lifecycle, uncovering usage patterns and optimal “days on hand” by location.

Optimize Asset Utilization—with Movemedical

Gain visibility and attain optimal asset utilization with Movemedical’s PPI Management module for hospitals. This revolutionary technology meticulously tracks medical device inventory “code life” and expiry, mitigating wastage. It optimizes asset usage by allowing health systems to re-allocate and balance medical device inventory. Embracing these strategies and technologies, enhances your hospital’s PPI management—which ultimately leads to significant cost savings, and improved patient care.

If a conversation about how Movemedical can help your hospital with managing PPI implants, let’s talk.

Contact us here:  / call 877.469.3992 or watch this VIDEO (executive case study)


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