Challenges for hospital supply chains

Gainesville is nationally known as the home of the top-ranked University of Florida; a public university of multi-disciplines and titled sports teams. Additionally, UF has earned many academic and health care accolades over the years.

Gainesville is nationally (and internationally) known for housing high-quality, top-tier health care facilities. Consequently, the challenges posed for hospital supply chains, and dealing with the many challenges that currently exist in the health care marketplace, in general, are topics of extreme relevance here in this “hospital town”. Some of the concerns include:

  • Keeping the many moving parts of the supply chain working like a well-oiled machine
  • Securing high-quality equipment without spending exorbitantly
  • How best to handle medical surplus
  • Increasing visibility
  • Optimizing data

And the list goes on!

During my stint in supply chain services at a large hospital, I accumulated some practical ideas about finding ways to reduce costs and enhance the overall supply chain as a vital entity:

Radio-frequency Identification (RFID) and cloud-based systems can provide greater insight for visibility.

Outsource the logistics operations to a third-party – This reduces supply costs and offers a reduction in workforce.

Leasing equipment Equipment constantly needs upgrading or replacement due to wear and tear and advancements in technology. For these reasons, consider leasing equipment and software. Be sure that the affiliated warranties, guarantees, and product/customer service agreements are included.

“While low-interest rates might make it more economical for hospitals to purchase, leasing often remains the better option,” says David Lips, a health care transactions attorney.

Preferred vendors — Having a selection of freight and shipping companies as priority providers, with agreed upon and negotiated inbound and outbound discounts, is advantageous.

Accurate data is vastly important in the greater scheme for dealing with supply chain challenges. Therefore, an in-depth review of core areas for improvement, followed by the implementation as required can significantly reduce those problems.

A recent Navigant Consulting study involving 2,300 hospitals’ supply chains nationwide reveals that 30 percent of operations are represented by supply chain spending. Providers can reduce budget spending by $10 million annually, per hospital, according to Alven Weil of Navigant’s Healthcare Thought Leadership.

“You don’t have a lot of control over the pricing of drugs,” stated Rob Austin, associate director of Navigant. However, there is wiggle room in other supply areas, according to Austin.

The importance of dealing with challenges effectively and looking at them as opportunities for improvement is emphasized in a statement made by the Chief Executive Officer of UF Health Shands, Edward Jimenez, “As an academic health center, our doctors, nurses, providers, and staff are constantly learning and improving on best practices.”

Brian Cook, President and CEO of North Florida Regional Healthcare, has stated that his organization works hard to equip staff with patient-centered decision-making skills and the latest health care technology.

Whether on patient floors, managers’ offices or in executive suites, the continuing challenges of managing hospital supply chains are significant but not overly burdensome and can be dealt with successfully. As Sir Winston Churchill stated, “A pessimist sees the difficulty in every opportunity; an optimist sees the opportunity in every difficulty.”

Michael Robinson is the proprietor of Ceremonial Speeches, a speech writing & presentation consulting service.

By Michael Robinson

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