Surgical Care Affiliates has renewed its prime vendor agreement for distribution services with Medline Industries Inc. The five-year agreement will deliver significant cost savings by driving distribution and supply chain efficiencies and reduced product cost. The agreement is expected to be worth approximately $175 million over the course of the deal.

As of March 31, 2014, SCA operated a national network of 175 ambulatory surgery centers and surgical hospitals in 34 states.

“Medline consistently helps us provide better, more efficient service to our physicians and patients,” said Chris Klassen, vice president of Supply Chain for SCA. “Medline’s manufacturer-direct model and supply chain efficiencies help reduce our costs and at the same time enhance our service levels and improve our profitability in a period when all healthcare providers are facing significant economic challenges.”

Medline will provide a broad array of its Medline brand medical and surgical products, as well as other national brand supplies at significant savings directly to SCA facilities from its more than 40 distribution centers throughout the country. Medline will also deliver cost savings and efficiencies to the hospital by implementing product standardization and utilization solutions, as well as providing enhanced reporting capabilities to help the health system better monitor and control costs.