The healthcare supply chain and the potential it has to tackle one of our nation’s biggest problems, rising healthcare costs, may finally be getting the recognition it deserves. It’s not that hospital leaders have not seen savings opportunities in the supply chain, but the majority of their focus has been on physician alignment, product standardization and more aggressive negotiations with suppliers. While these efforts can and have yielded savings for hospitals, they are still limited in scope, making improvements in very specific areas as opposed to a more holistic approach that can yield savings across the entire supply chain. If we are truly going to take costs out of the healthcare system, we have to look at the entire system, rather than just trying to reduce costs for one sector, potentially at the expense of another. 

Interestingly, the concept behind the 1996 study that got many of us to focus more on the supply chain – the Efficient Consumer Healthcare Response (EHCR) study - has been...

For those focused on the healthcare supply chain, the seemingly endless debate that eventually led to passage of the Patient Protection and Affordable Care Act of 2010 (more commonly referred to as the healthcare reform bill) was particularly frustrating, not so much for the divisive discourse as for the lack of consideration of the role the healthcare supply chain can play in achieving one of the bill’s primary objectives: the delivery of quality healthcare at a lower overall cost. But upon closer inspection of the final bill, there are a number of provisions that could push the supply chain to the forefront of efforts to meet that objective. 

Value-based Purchasing

A primary purpose of the healthcare reform bill is to move from a system that pays based on volume to one that pays based on value, e.g., reimbursement based on quality outcomes and efficient healthcare delivery as opposed to the number and types of procedures performed. The bill includes a long list of provisions that tie reimbursement...

As I was flying back from the Medical Device Supply Chain Council (MDSCC) meeting this week, a book excerpt in an airline magazine caught my attention. The lead was: "Information is king, hyperconnectedness puts that information in the hands of the many, and transparency reveals all." That's certainly the reality we are moving toward in healthcare. In the book, "How: Why HOW We Do Anything Means Everything," author Dov Seidman underscores what hospitals had to say to suppliers this week.

Seidman effectively makes the case that success no longer depends so much on "WHAT you do, but HOW you do it." In a world of reverse engineering, he argues it is much harder to innovate in WHAT, at least not in a lasting way. Even process improvement for many industries, he says, has become a commodity. Everyone's doing it. While many in healthcare...

Many of the discussions at the UDI conference have been about calls from major group purchasing organizations (GPOs) and healthcare systems for suppliers to use GLNs in business transactions.  The onus would appear to be on the suppliers, but in reality, the responsibility is on hospitals and healthcare systems.

Welcome to The Healthcare Hub, a new blog focused on the opportunities that can be created through greater collaboration and visibility in the healthcare supply chain. When I started working at GHX in 2000, the healthcare supply chain, for the most part, was viewed as a highly manual, error-ridden process and credited with doing little more than processing orders and moving boxes. Today, more and more hospital executives appreciate the role the supply chain can play in improving both business and clinical performance. Suppliers, meanwhile, see supply chain optimization as a way to create competitive advantage, improve customer satisfaction, meet regulatory requirements and control costs...