MaineHealth enters $400M 10-year contract with supply chain vendor

MaineHealth, the largest integrated health system in northern New England, announced Monday it has entered into a 10-year, $400 million prime vendor distribution agreement with Medline to build what's being described as “a best-in-class supply chain.”

Based in Northfield, Ill., Medline is a global manufacturer and distributor of medical products that supports nearly one-third of the largest health care systems in the United States as an exclusive prime vendor. Its customers have access to more than 550,000 medical devices and support services, and the company has achieved year-over-year distribution growth for more than a decade.

According to a news release announcing the 10-year agreement, over the past three years, Medline worked closely with MaineHealth to customize its perioperative surgical packs. By doing so, Medline stated it “established a proven record of superior customer service, flexibility and progressive ideation that led to taking the relationship to a more expansive and strategic level.”

Prior to the new agreement, MaineHealth had been with the same medical supply distributor for more than 25 years.

"Medline's vertical integration and ability to execute on forward-thinking initiatives will help create a best-in-class supply chain," says Luis Soto, MaineHealth’s vice president of supply chain management. "A more efficient supply chain translates into clinicians spending less time on non-clinical activities and more time with patients, along with cost savings that can be reallocated to their care."

The agreement spans MaineHealth's 11 community hospitals across the state and New Hampshire. Of those, Maine Medical Center has been named by U.S. News & World Report as a "Best Regional Hospital" for the sixth consecutive year and as the best hospital in Maine in 2018-19.

It also fulfills one of the stated goals of the unification plan approved last October by MaineHealth’s corporators, who gave final approval to the unification plan in which the health system’s Maine-based hospital members became a single not-for-profit entity on Jan. 1. Although each local organization retains a local board that has a significant role in overseeing the care delivered in each community, unification of MaineHealth’s community hospitals was seen as facilitating the integration of care across the entire health system.

"Health systems need strategic partners, not just vendors," Medline Vice President of Corporate Sales Jeff Durham said in the news release. "Medline co-creates strategies with systems to optimize their supply chains. Currently, a team of Medline engineers are conducting assessments to increase operational enhancements such as pick accuracy and pick time at MaineHealth's distribution center. Medline will continue consulting with MaineHealth to evaluate distribution strategies at other facilities across its continuum of care."

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