I have been pleased to see a number of reports, news releases and blog posts recently about the value of cloud computing in healthcare. One of my favorite bloggers, Tom Finn, with Healthcare Matters, recently wrote about the value of cloud-enabled supply chain management, noting “it’s not a matter of ‘if,’ but rather ‘how’ healthcare providers are going to implement ‘cloud computing’.” Tom also referenced a recent KLAS news release that says 71 percent of providers are deploying or plan to deploy cloud technology. All good news, but I have a concern. In both pieces, and I would argue in most cases, the cloud is being viewed too narrowly in healthcare. 

Finn talks about how it can help the supply chain, while KLAS focuses primarily on how clinicians would use it. But the real value of the cloud is its ability to...

I was talking to a colleague the other day about how the economic challenges faced by both healthcare delivery systems and their vendors may actually create the impetus we need to better align goals across the supply chain.  Misaligned incentives have been a major factor in the historic lack of trust between providers and suppliers, which has hampered their ability to lower the cost of doing business together and, in turn, the cost of healthcare.  Unfortunately, Wall Street’s almost myopic focus on top-line growth could impede efforts by many healthcare suppliers to make the kinds of changes I believe are needed to position them for success in an era of healthcare reform.

The US Supreme Court’s decision to review the constitutionality of the healthcare reform law will certainly create some good fodder for political pundits, with the oral arguments occurring during the height of the presidential campaign season, but it does little to address the more pressing question:  how to lower the escalating cost of healthcare, without negatively impacting patient care and without waiting on the courts or the political process.    No matter where they stand on the law, the hospital and healthcare delivery system executives I talk to all agree, they cannot wait; they have to take action to cut costs NOW. 

Those who have visited The Healthcare Hub before know I spend a fair amount of time talking about collaboration. I’m not alone in my interest in the topic. It’s showing up on agendas of industry conferences and on the research agendas of major analyst firms. The problem is, while most folks say they want to collaborate more, whether with others in their own organizations, or with their trading partners, few really know how to develop a truly collaborative relationship, and more importantly measure the results. Did it really make a difference, for both parties, and is it sustainable and repeatable?

I just finished reading a white paper on supply chain collaboration in healthcare, which provides some real life examples of successful collaborations(with results) and some guidelines on how to identify and engage with potential partners.

One thing the paper underscored is the real value of collaboration:...

Something very special happened in Chicago this past week. A group of healthcare manufacturers and hospital executives came together and gave me hope, for the first time in a while, that we may actually find the answers to our current healthcare crisis through collaboration. And I got to thinking, “What if our lawmakers in Washington, who cannot seem to agree on anything including healthcare, could have listened to this conversation?”

What made today’s meeting so special is that when these two groups talk, it is usually about a topic on which they naturally disagree: price. Suppliers want to sell high, hospitals want to buy low. Instead, today, they focused on what they have in common and how they can help each other achieve their respective goals. Instead of complaining about supplier profit margins, the hospital executives around the table said repeatedly: I want my suppliers to make money; I want them to stay in business. At the same time, they called on the suppliers to help them keep their doors open...

When it comes to elevating the role of the supply chain in hospitals, we may be our own worst enemy. That was one of the takeaways from the most recent national executive survey on supply chain management presented at the 2011 AHRMM Conference in Boston. Recently, I had a chance to sit down with Jamie Kowalski, who has been researching perspectives about the healthcare supply chain for AHRMM – The American Hospital Association’s membership organization for supply chain professionals - for nearly 30 years. This year’s study, conducted in partnership with Marquette University, compares and contrasts how hospital executives and supply chain leaders view the strategic value and performance of the supply chain in their organizations. Generally, both parties agreed, the supply chain can have a positive impact on clinical and organizational performance. While the average scores were not bad, 3.6 to 3.8 out of a possible 5, respectively, Kowalski expressed disappointment that the overall scores were not higher. More importantly,...

In recent months, I have heard both hospitals and suppliers agreeing on a topic that has traditionally put them at odds, that is, their attempt to influence physician preference for items such as cardiac stents and replacement joints. These items are among the most expensive products, are associated with the most profitable service lines, and potentially have the greatest impact on patient care. Rather than putting the physician in the middle, there is growing recognition among hospital and supplier executives that they need to work together WITH physicians if we are going to achieve a more patient-centric healthcare system.

Under healthcare reform, physicians, hospitals and suppliers will all need more insight into both the clinical efficacy and cost of products used in patient care. In a reformed healthcare world, the combination of cost and quality will determine reimbursement payments, which, in many cases, will be bundled to be shared by hospitals, physicians and other care providers.

This was...

I had the chance to hear Jamie Orlikoff, one of the better consultant-type speakers, at the AHRMM Conference yesterday. It was actually the third time I have heard Mr. Orlikoff speak, but each time I gain some new insights. His message is not necessarily new (Healthcare expenditures are on an unsustainable upward trajectory), but he positions the problem in a manner that – while certainly dire – should provide some clues as to how we got into this mess and what we need to do about it.

The biggest takeaway: despite the best of intentions, our healthcare system is doing a disservice to its customers, the patients. Consider these statistics that Mr. Orlikoff shared with the audience:

30% of what we spend on healthcare adds no clinical value (Orlikoff thinks it is closer to 50%) 4.4 million hospital admissions – at a cost of nearly $31 billion – are preventable 19.6% of Medicare patients are readmitted to the hospital within 30 days; 28.2% within 60 days, and only 10% of those readmissions are planned....

Supply Chain Revolution is the theme for the 2011 AHRMM conference, being held this week in Boston. For those who may not know, AHRMM – which is part of the American Hospital Association – stands for the Association for Healthcare Resource & Materials Management. What’s worthy of note is the transition from use of the term “materials management” to “supply chain.” Just yesterday, I met a woman who said her health system had recently changed the name of her department – and her title – from materials management to supply chain. While it might sound like just semantics, I think the change is more significant. It reflects a growing appreciation for the scope and the role of the healthcare supply chain.

Today, at AHRMM, I had the opportunity to present some of the highlights from a new white paper on "Applying Supply Chain Best Practices in Healthcare." As I told the audience, when this topic came up in...

Quick update. We learned this week that the proposed UDI rule from the FDA (requiring manufacturers to assign a unique device identifier or UDI to their products) will likely not be out until August or early fall. While you are waiting, here’s something to do. Click here to watch/listen to a webinar featuring Jay Crowley, the FDA’s point person for UDI, on what manufacturers can expect in the proposed rule and what they can be doing NOW to prepare. Next month, Natalia Wilson, MD, will present a follow up webinar on the clinical relevancy of UDI. Scheduled for Tuesday, July 19 at 11 am eastern time, the webinar will be of value to both providers and manufacturers. Supply chain leaders at hospitals and healthcare systems are encouraged to invite their clinical counterparts; manufacturers should invite those responsible for evidence-based medicine. Click here...