NEWS RELEASE

Novation Survey on Obese Patient Care Supplies Shows Nearly 50 Percent Increase in New Bariatric Supply Purchases as Obese Patient Admissions Continue to Rise

IRVING, TX; May 14, 2007 — The admission of obese patients continues to rise at hospitals across the country according to findings in Novation’s fourth nationwide survey of VHA Inc. and University HealthSystem Consortium (UHC) member hospitals. Novation, the industry’s leading health care contracting services company, surveyed materials managers and surgical services directors to assess how hospitals are responding to the increasing need for specialized equipment, facilities and supplies to properly care for obese patients.

Hospitals responded and seventy-eight percent of the hospitals surveyed reported an increase in admissions of severely obese patients, up 22 percent from the previous year. Nearly 50 percent of hospitals had to purchase new categories of supplies for the treatment of obese patients including beds, lifts and wheelchairs resulting in a 29 percent increase over previous years.

“Hospitals are better equipped today to treat obese patients and more educated about the products and supplies that can help them provide better quality care to obese patients,” said Sandy Wise, senior director at Novation.

Nearly a third of the respondents cited an increase in workplace injuries related to caring for severely obese patients, however, 42 percent reported a decrease in injuries as a result of purchasing equipment or offering training programs.

The median spend on expenses related to the treatment of severely obese patients in 2006 was $35,000 and over half (63 percent) of the respondents stated they spent more in 2006 than in 2005. Bariatric surgery programs continue to impact the hospitals’ bottom line according to 76 percent of respondents. Forty percent of respondents have a bariatric surgery program and 48 percent of the facilities with bariatric surgery programs are accredited as a Center of Excellence by the American Society for Bariatric Surgery. This accreditation highlights bariatric surgery centers that meet specific performance standards and show consistently positive surgical results for patients. Nevertheless, hospitals are purchasing supplies that accommodate obese patients and visitors in all areas, not just in bariatric units.

Novation offers more than 1,000 of the most widely used bariatric products in its bariatric portfolio and will continue to research issues faced by hospitals to provide the most cost-effective ways to control costs in hospitals while still maintaining a high level of care.

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About Novation
Founded in 1998, Irving, Texas-based, Novation is the leading health care contracting services company, delivering unmatched savings and value to nearly 2,500 members of VHA Inc. and the University HealthSystem Consortium (UHC), two national health care alliances and nearly 12,000 members of Provista, LLC. Through its competitive contracting process, Novation develops and manages contracts with more than 500 suppliers. Novation offers the most extensive range of advanced contracting services, including: contract development, contract and supplier management, custom contracting, enhanced savings programs, online contract management and analytical tools, order management and online supplier connectivity. VHA, UHC and Provista members used Novation contracts to purchase more than $33.1 billion in 2007.

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