J&J's $70 MIL. PACT WITH HUMANA WILL SAVE "OVER $5 MIL."

Executive Summary

J&J's $70 MIL. PACT WITH HUMANA WILL SAVE "OVER $5 MIL." for the hospital owner and operator in purchasing and product utilization costs during the three-year life of the contract, according to a recent Johnson & Johnson release. The $70 mil. J&J/Humana agreement, which took effect Jan. 1, includes 15 J&J professional subsidiaries. J&J notes that the pact involves "primary vendor contracts with two of those affiliates" -- J&J Products' Patient Care Division line of wound care products and Surgikos' surgical specialty products. These agreements cover unit pricing based on volume purchases and mainframe computer order entry through J&J's new COACT on-line procurement system, "which will enable Humana to reduce logistical costs," J&J states. Humana is expected to further take part in J&J's COACT system with other J&J subsidiaries as the system rolls out nationally and the hospital computer line becomes adaptable to it. Additional savings will be realized through the use of J&J's STANDACARE programs designed to improve product resource and utilization, the company adds.