As health systems work to integrate new facilities, such as physician practices and ambulatory surgery centers — and as patient care migrates outside the hospital — non-acute care has become a growing part of many health systems. But managing the supply chain across the non-acute continuum poses unique challenges for supply chain leaders.
Unlike acute care, where the supply chain is highly coordinated from end to end, the non-acute continuum is fragmented. Geographically dispersed locations that operate separately from one another, clinical infrastructures that span across different specialties and significantly more people placing orders make managing the non-acute continuum extremely complex. Yet a growing need for supply chain leaders is to carefully manage operations to drive down costs and improve financial performance while delivering high-quality patient care.
Here are 10 areas in the non-acute supply chain where you can make improvements to help meet these goals:
The non-acute care supply chain is complex but becomes even more complex and less cost-effective when multiple vendors provide supplies across your non-acute care settings. The more suppliers you must coordinate and manage, the more time your team and clinical staff spend on ordering, handling multiple deliveries, processing invoices and ensuring that all deliveries are where they need to be when they need to be there. Additionally, by splitting supply orders among multiple vendors, you may miss out on volume discounts and other pricing efficiencies.
"If you're cobbling together more of a marketplace approach for your supplies, you don't have a high likelihood that all of that supply will arrive as needed, and that can have a really negative impact on the care given to the patient and adds to the complexity and volume for back-office functions," said Jon Pildis, vice president of materials management for McKesson.
Having the right data can help health systems make better decisions and improve operational efficiency by giving supply leaders the visibility to identify opportunities to consolidate vendors, aggregate orders and streamline ordering and invoicing.
However, it's not uncommon for non-acute care facilities to use different technologies and tools, making it a challenge to aggregate data and get a holistic view of your non-acute supply chain operations. Consider working with a supply chain partner that can provide you with the tools to gain visibility into your own supply chain operations as well as access to peer benchmarking. This will allow you to predict the rate of usage of your most frequently ordered supplies. It will also let you see what similar clinicians in your own and other health systems order for various common clinical conditions, procedures or surgeries, which can be invaluable to support and standardize supply chain decisions.
3. Process automation
Automation is central to keeping costs down and quality of care high. Here are few ideas about how you can automate processes to save time and lower costs:
Use technology to automate manual processes, such as matching invoices to packing slips.
Use predictive analytics to help predict what supplies will be needed and to automate future orders.
Use bar code scanning or tracking software to automate inventory and formulary control and ensure products are charged back to patients.
4. Strategic cost management
To be strategic in managing your costs, you first need the right data to inform your cost negotiations with suppliers. Having comprehensive data allows you to match product ordering to usage. Additionally, when negotiating with suppliers, think beyond specific product costs to other issues that can affect clinical outcomes or financial performance, such as late, inaccurate or damaged deliveries and storage issues.
Having visibility across the entire non-acute care continuum is essential to standardizing processes and strategically managing costs. "Visibility helps improve your bottom line and can help identify and measure operation efficiencies, care standardization and contract compliance outside the four walls of the facility," said Jacob Hookom, vice president of B2B Customer Experience, North America at McKesson.
Having the right data at your fingertips enables more agile decision making. In a health system, there's a stark contrast from the mature supply chain of the hospitals and that of the constantly evolving non-acute continuum where each facility can act as its own micro-supply chain. Establishing visibility across these fragmented and disjointed facilities is the critical first step to driving both operational and clinical initiatives, resulting in better financial performance. Having an aggregated information platform that provides visibility across the non-acute continuum, from the physician's practice to the patient's home, can lead to better outcomes operationally and financially. Having the right tools allows health systems to observe and track purchasing behaviors across all non-acute care settings.
Standardization can potentially save the average health system 12% to 18%. Successful standardization begins by having quality data. With strong data analytics and visibility into all aspects of the non-acute supply chain, health systems can identify key items ordered most regularly and develop a customized formulary, which is the foundation of standardization. Besides driving efficiencies and helping to save money over time, supply chain standardization eliminates the effect of product variation, maximizes contract compliance, reduces SKUs and optimizes the clinical infrastructure of the entire health system, which can improve clinical outcomes.
"When you have the same consistent product always being used across all care settings, the product is more likely to be used appropriately. This leads to better outcomes, healthier patients and decreased readmissions," said Bethann Maynard, director of customer management at McKesson.
7. Post-acute care
To design your post-acute supply chain for optimum efficiency, effectiveness and quality of care, you need supplies delivered directly to clinicians or patients at the point-of-care, including home health settings. Otherwise, clinicians may waste valuable time driving to replenish supplies to get the ones they need, or patients may not have the necessary products to care for themselves at home, which could lead to being readmitted because of an infection or post-surgical complication. Readmissions negatively affect health systems' reimbursements, so it's critical to proactively ensure that post-acute patients have the appropriate supplies for their care.
Integrate your supply chain and lab functions to work together. This will help improve patient satisfaction, clinical outcomes and revenue. Supply chain doesn't often realize the significant impact they can have on labs. When it is set up properly, labs can generate revenue.
When there is close integration between the non-acute supply chain and lab functions, your health system can achieve increased standardized test results, SKU optimization and supply chain utilization strategies — all of which help drive down costs while driving up the quality of care you deliver to patients.
Like labs, the pharmaceutical supply chain is another area where consolidation of suppliers and standardization lead to efficiencies across the non-acute continuum. By streamlining the way health systems manage their pharmaceuticals with their overall non-acute continuum, they are more likely to have fewer invoices and deliveries while increasing compliance in electronic ordering and reducing administrative costs and overhead.
Managing pharmaceuticals across a diverse network of care settings can present several new challenges for supply chain leaders. As the use of vaccines and expensive specialty pharmaceuticals continues to grow, so does the need for a highly efficient and reliable supply chain that also ensures product integrity such as temperature-safe storage. Accessing technology such as the DEA-administered Controlled Substance Ordering System (CSOS). The CSOS ordering system is integrated into the distributor platform to provide more security, validate and authorize orders, reduce the order to procurement timeline and provide better tracking.
10. Stakeholder alignment
One of the biggest challenges for supply chain leaders is getting buy-in from the many stakeholders across the non-acute continuum. But for an organization to implement a successful and comprehensive non-acute strategy, stakeholder alignment is critical. Having the data and the visibility to show stakeholders how supply chain processes can be automated, standardized and managed more cost efficiently is one of the best ways to achieve stakeholder buy-in and alignment.
Achieving non-acute care supply chain success
Meeting financial and patient-care goals in the non-acute continuum requires supply chain leaders to standardize, automate and integrate across the continuum — and to do so, you need analytics and visibility. By bringing all these components together through finding the right vendor can help you put all these pieces into place within your non-acute continuum and create better continuity of care
"By having a relationship with a distributor that is close enough and strategic enough allows an unmatched level of collaboration and familiarity so that there's really a shared mission between the distributor and the health care enterprise, and that it's not just transactional," Pildis said.
To dive deeper into achieving non-acute supply chain success, download this e-book: The Roadmap to Non-Acute Success.