Supplier Quality

Managing health care costs in an economically sustainable manner is a priority at Corewell Health. The Total Cost Recovery (TCR) program works to recover administrative costs and lost operational activity resulting from recalled or defective products, medical devices, equipment, and pharmaceuticals purchased by Corewell Health. We are committed to our TCR program while equally dedicated to maintaining our relationships with our supplier partners. The TCR program applies only where permitted under applicable purchase agreements or other written contracts between Corewell Health and the supplier. Corewell Health is proud of our strong partnerships with suppliers and confident that suppliers will be proactive in the identification, communication, and termination of products that meet the above qualifications. We thank you in advance for addressing recalls in a safe and efficient manner to better protect our community.

TCR program development, collaboration with other health systems, and strong supplier partnerships will drive resilience, enable growth, and help to define industry-wide expectations.

Where permitted under applicable agreements, the TCR program may invoice the supplier, requesting payment to Corewell Health for a specified amount.

Corewell Health implemented the TCR program to manage and offset the unplanned expenses caused by medical supply recalls and product defects. Each incident requires immediate investigation and internal actions beyond expected daily activity. This program ensures the burden to safely manage product recalls and/or defects does not fall exclusively onto the Corewell Health team.

The invoice incorporates fixed and variable charges. Fixed charges account for the issue response-associated work of the supply chain quality improvement specialist (time spent but not limited to; initial risk triage, researching product location within our system, pulling and quarantining inventory, validating potential alternative products, system communication, and returning product to the supplier) and management of the TCR program. Variable charges are individually calculated for each issue response and are based upon the magnitude of effort required of Corewell Health to effectively resolve the issue. Effort is defined by the quantity of Corewell Health team members, clinical and non-clinical, and the amount of time required of them when unexpectedly pulled from daily operations to assist in managing the response. All charges assessed under the TCR program are intended to reflect reasonable, documented costs directly attributable to the specific issue response event.

Corewell Health’s TCR program accepts checks issued to Corewell Health. Details for payment are included on the invoice. Corewell Health's TCR program does not accept Electronic Fund Transfers (EFTs) or rebates.

In the event a credit memo is preferred by your organization, the TCR coordinator can work with your business to make alternate arrangements.

We have modified our purchase agreement language. Most of our agreements, including our Vizient contract, contain a clause noting that the supplier is responsible for costs associated with an issue response event. If there is special language limiting or restricting such cost recovery by a supplier, those will be addressed during contract negotiation by our sourcing specialists.

No, this should not affect suppliers from voluntarily recalling products. Best practice dictates that a company should voluntarily recall a product or device and notify the FDA when an FDA law violation is discovered. If there is refusal from a company to recall a device, the FDA has the right to require a recall associated with significant health concerns or death. However, in practice, the FDA claims the requirement of a recall has rarely been needed. Often, when suppliers are not sure on the extent of a quality problem or concern, they recall products as a precautionary measure.