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Hospitals Still Using Manual Processes for Supply Chain Management

Close to half of hospitals use manual processes like spreadsheets to manage supply chain data, according to a survey of 100 hospital leaders.

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Source: Thinkstock

By Fred Donovan

- Close to half of hospitals use manual processes like spreadsheets to manage supply chain data, according to a survey of 100 hospital leaders.

Thirty-seven percent of respondents said they use Excel or other Microsoft tools to track margins per case for operating room (OR) procedures, according to the poll conducted by Sage Growth Partners on behalf of supply chain management vendor Syft.

Around one-quarter use other low-tech tools, do not know if they track OR margins, or do not track those margins; 36 percent use a specific technology solution to track OR margins.

Nearly two-thirds of respondents said that investment in supply chain management (SCM) is a high priority for them, but only 13 percent said it was their top operational investment priority. Patient throughput, process improvement, perioperative environment, staffing turnover, retention and management beat out SCM as the top operational investment priority for respondents this year.

While 86 percent of respondents believe improving SCM would improve care quality, 27 percent said their hospital does not yet use SCM data analytics to identify ways to improve quality.

Almost all respondents said better SCM can improve hospital margins: 52 percent said better SCM can increase margins by 1 percent to 3 percent, and 35 percent believe it can increase margins by more than 3 percent.

Sixty-three percent of respondents said that there is clear return on investment (ROI) for supply chain analytics, while 97 percent believe supply chain analytics can positively impact their organizational costs.

Other areas where respondents believed supply chain analytics could have positive impact include value-based care, quality, staff satisfaction/retention, patient outcomes, and regulatory adherence.

Hospitals are using several different SCM approaches, including in-house solutions, their EHR, a third-party solution, and outside consultants. Two in five do not analyze their supply chain at all.

Three-quarters of respondents reported using their SCM solutions for basic analytic functions such as tracking inventory or consolidating suppliers.

The ability for current solutions to perform more advanced functions were less frequently cited: accessing data on case cost in the OR (57%), identifying and managing expired supplies (50%), surgeon supply use variance (42%), and other (3%).

“As we move towards value-based care models, hospitals are facing increasing pressures on their margins, and on their ability to deliver quality care,” said Syft CEO Todd Plesko.

“Hospital leaders are going to need to use every tool in their toolbox to succeed, and they will need to turn the supply chain into a strategic business lever – not only to save money, but to improve clinician satisfaction, patient outcomes, and the care patients receive,” Plesko added.

Supply chain management was identified as one of the use cases for healthcare blockchain in a recent HITInfrastructure.com feature article.

Blockchain can be employed to “track drugs, medications, from manufacturing to distribution, to use in dispensaries, to be able to root out counterfeit drugs, to be able to get better transparency and efficiencies on the usage sides, or the point of use at the dispensaries, like a pharmacy,” David Houlding, Principal Healthcare Lead at Microsoft Azure and chair of the HIMSS Blockchain in the Healthcare Task Force, told HITInfrastructure.com.

Aditya Kudumala, a principal at Deloitte Consulting, said that blockchain can improve visibility into the data flowing through the supply chain network, facilitate collaboration, and boost traceability of drugs in the network.

“The blockchain is helping us create that whole chain of custody in a much better way than what we had before. We can have near real-time exchange of information happening from the manufacturer of the drug to the distributors, to the logistics providers, to the sites and, and ultimately to the patient,” he said.

Organizations can also track the movement of physical assets, such as medical devices, laptops, or other portable technologies, Houlding observed.

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