3 Tips for Reducing Supply Chain Costs

Traditionally, supply chain product value analysis hasn't focused much at eliminating waste or misuse. "We, in the old days, have looked at a limited variety of products," says Dee Donatelli, RN, senior vice president of provider services at health technology research and consulting company Hayes Inc. "Physician preference has always been at the top of the radar."

However, that needs to change, according to Ms. Donatelli. At the Becker's Hospital Review 5th Annual Meeting in Chicago on May 17, she offered the following three tips for healthcare providers looking to contain costs and improve care quality through a change in supply chain value analysis.

1. Focus on the evidence and do thorough research. Ms. Donatelli called evidence the "missing link" in product value analysis. "We need to move the value analysis process to a more fact-based, objective approach," she said.

She advised providers to evaluate the quality and quantity of clinical evidence concerning products. When fielding requests from clinicians, she said starting by reviewing the evidence to determine whether the equipment is newly innovative or truly needed is best for quality of care and the bottom line. "If we don't obtain the clinical outcomes that we need to over the next few years, we'll continue to lose more and more money," she said.

2. Assess vendor relationships. Hospitals should determine which vendors bring them the greatest value in terms of cost and quality of the products, Ms. Donatelli said. They should also look to reduce variation in products. "You cannot do business with everybody and drop costs out of your system," she said.

3. Engage physicians and other clinicians. Hospitals need to engage physicians and other clinicians in the fact-based value analysis approach. "We keep that to the very end of the process today in many cases, or not at all, and we wonder why we don't impact cost savings," Ms. Donatelli said. "The people who would effect cost savings haven't been engaged."

Physicians and other clinicians can help determine what the clinical issue in question is and assist in comparing the quality of different products. Their perspective will help the hospital achieve the best outcomes. "Doctors don't care about what things cost," she said. "Their number one care is the outcomes and the patients. If we can economically align that, we can drop the bottom line. We have the triple aim."

More Articles on Supply Chain:
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10 Trends in Hospital Supply Chain Management 


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