The value of supply chain in quality patient care
August 15, 2017
When we talk about the supply chain in healthcare, the discussion usually turns to the dollar cost of waste and inefficiencies. In fact, a 2012 National Academy of Medicine study estimated the US healthcare system wasted $765 billion annually. That’s a staggering statistic.
But behind those big numbers is another, equally important story. Today, with the advent of value-based care—offering high quality care at the lowest cost—healthcare organizations are starting to scrutinize the supply chain and focus on how supply management affects the patient care experience.
In the white paper, How value-based supply chain supports value-based care, we outline the future of supply chain in our value-based environment. And it’s just in time, as the Centers for Medicare and Medicaid Services announced in 2016 that it anticipates withholding more than $500 million in payments for 2,600 hospitals with readmissions.
The key to supporting value-based care throughout the supply chain depends on thinking of its management in new, more scientific ways, and building a system that gives caregivers what they need, when they want it, and in the right amount. No easy task, but it starts with partnering with those providing care across the spectrum—from physicians to nurses. I can't tell you how many people I talk to who tell me that doctors and nurses have taken supply management into their own hands because they don’t trust the existing system. Giving them and other senior leaders true, data-driven visibility into the what, where and why of supplies and medications can begin to change the organizational culture and get them to embrace a mindset where supplies play a big part in the value chain.
Infor Inventory Intelligence for Healthcare from Infor Dynamic Science Labs uses a science-based approach to optimize stock levels—the same science that helps retail and financial institutions solve their own business issues. One of our clients is Sanford Health. Using Infor Inventory Intelligence for Healthcare, it has seen a 17 percent reduction in inventory in only 6 months. That’s $129,000 in savings. It has also helped them support service levels, which in the end, is the most important part of the organization’s mission.
And as the future of healthcare continues to churn and the question of how to best deliver care in a way that doesn’t bankrupt the entire system, supply chain will always be at the core of cost savings. It’s time to look at it holistically.
Cory Turner, Supply Chain Strategy Director, Infor Healthcare
- North America