The strategic value of supply chain in tackling costs, eliminating waste and driving efficiency has never been more important — or in the spotlight. GHX honors the Best 50 U.S. healthcare organizations for improving operational performance and driving down costs through supply chain automation each year at the GHX Supply Chain Summit. The competition to win gets a little more challenging each year as winners achieve new levels of efficiency, making the accomplishment more noteworthy with each passing year.
We're sitting on the cusp of a technological revolution that will surpass any such shifts we have seen in the past. The speed at which new technologies are disrupting business as usual across so many different industries and practices is unprecedented, and it comes with both a promise and a threat. It promises to make our lives easier, more efficient, and better connected while at the same time threatening to upend norms we've come to depend upon and disrupt management systems that have been in place for decades.
The healthcare industry is at the forefront of this dual promise/threat. Here is a look at the benefits that these new technologies can bring.
Incorporating and maintaining accurate product data within one’s item master is a critical step in gaining visibility, driving purchasing accuracy and capturing revenue. Problems with item master data, whether it is related to incomplete, duplicate or missing information, is painfully felt throughout the value chain in lost savings, reduced charge capture and potential lost revenue. In clinical areas, confusing and duplicate item descriptions can leave clinicians frustrated with search efforts and manually documenting supplies which can lead to further revenue losses. Efforts to pinpoint and address the specific issues can no longer be pushed aside with hospitals already working within thin margins that are likely to get even thinner.
One of the key questions I hear consistently is: how can I design a supply chain for my organization that is truly effective and strategic for my organization? What are the important things I should be prioritizing?
We rely on data every day but getting to the point of truly relevant data is a process. Relevant customer data is more than who buys from me. It is all of the information that describes the people and companies that you care about, and it is everything related to who made it, who buys it, who uses it, who holds the contract and more.
The importance of a well-executed vendor and business associate management plan cannot be overstated. It is certainly obvious from headlines over the last several years that organizations that don’t put the time in are risking financial ramifications as well as damage to reputation, which can be even more costly. The good news is that focusing your efforts on vendor and business associate(BA) management brings value to organizations in multiple ways. By putting into place processes that improve visibility into your vendor population and management of business associate relationships you improve compliance with the Health Insurance Portability and Accountability Act (HIPAA) Final Omnibus Rule, are better prepared for an Office for Civil Rights (OCR) audit, and internally gain greater operational efficiency from more streamlined processes.
Supplies in the category of maintenance, repairs and operations (MRO) can be particularly challenging – and costly - for healthcare providers to manage. While the products may cost only a few dollars each, the overall cost to procure these items can equal - or exceed – the cost of the products themselves.
In many cases, hospital maintenance staff will go out and shop at local stores for these items using their purchasing cards. Not only are the products procured this way often more expensive than those from suppliers with which the hospital has contracted, there are also the added labor costs and other expenses associated with staff members shopping at various local stores. It is clear that gaining visibility into and control over these items presents a significant opportunity for cost savings.
Epayable solutions are widely accepted in many industries as the standard for business-to-business transactions. The healthcare industry, however, has been slow to adopt this payment method. The delay in adopting electronic payments has resulted in inefficiencies that make it more challenging for healthcare to deliver against its mission to strip waste from the system.
Successful supplier and provider relationships are forged by information sharing that allows the provider to secure the data and information it needs for daily business practices and tasks throughout its organization. Legal and contracting documentation, accounts payable (AP) data, purchasing data and compliance documents all need to be vetted, stored and updated on a regular basis.
The holy grail of electronic health record (EHR) systems is to enable healthcare organizations to deliver more effective and efficient patient care. However, when the data within these EHRs is siloed within certain departments or contain inaccurate or incomplete information, it becomes nearly impossible to accurately track medical costs, reorder necessary supplies and support the industry’s mission to provide that desired level of outstanding patient care.