Take a Fresh Look at Your Supply Chain

By: Avaap
Date: July 09, 2015

There’s a dual challenge inside most hospital organizations: How does management reduce costs and also deliver better patient experiences? Looking to the supply chain can help organizations use data to identify waste and opportunity to trim costs; connecting supply chain data with labor and other costs provides more accurate insight into what it actually costs to treat a patient, linking care to quality.

“Many hospitals are running legacy technology with supply chain data that is not integrated with patient, clinical, revenue cycle management or other financial data,” said Greg Benton, vice president, Strategic Markets at Avaap. “Without a single view of the truth, hospitals will continue to struggle with evaluating the impact of supply chain on cost, quality, safety, patient outcomes, reimbursement, process efficiency and other factors.”

Optimizing the supply chain around patient outcomes requires aligning patients, professionals and technology systems. Organizations with visibility into the total cost per patient – not just the salariessecret-weapon of doctors and nurses but the cost of drugs, lab tests, medical supplies and other services– can use data to drive improvements.  Making an upfront investment in systems that connect data and a commitment to business process change can help drive a patient-centered supply chain and help hospitals provide higher quality care at lower cost.

Take a fresh look at your supply chain and ask:

Is Your EMR linked to your ERP? Linking information systems that connect patient conditions and patient care to inventory systems that control where supply is located and preferred supplier-contractor relationships can reveal opportunities for cost-cutting. For example, why does the same procedure cost more by one surgeon than another? Are there differences in the cost of bandages, implants or devices used? Were redundant or unnecessary lab tests ordered?  Were certain supplies unavailable because current inventory sat on a shelf too long and expired? Understanding supply costs and impact on care quality can help hospitals create a standard of care to reduce excess spending. Better understanding of what it actually costs to perform a procedure can also help with contractor and insurance company negotiations.

Do you have access to analytics? Tracking care to quality is often a challenge because data resides in silos. Connecting clinical, supply and financial functions can help predict and anticipate supplies and resources that are needed to care for patients and ensure inventory aligns with demand. Analyzing data can reveal patterns such as a supply room that runs out of saline solution frequently or high-value items that are ordered automatically but shouldn’t be, either because they’re expensive or have specialized uses.

Can you identify areas of waste or hoarding? With merger and acquisition activity rampant, many hospitals find inventory dispersed across locations. Centralized inventory control and distribution can help organizations leverage efficiencies, reduce waste and negotiate more favorable supplier contracts.

Contact Avaap to learn more about supply chain optimization or business process assessments.

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