Healthcare Transportation as an Integration Agent

News stories abound on the challenges and opportunities created by national and state healthcare reform. Healthcare executives are responding to reform by expanding the footprint of their health systems through mergers and acquisitions and other strategic partnerships built around a push to increase care outside of the four walls of the hospital. As the reach of a single hospital or healthcare system continues to grow, connecting all of a system's entities and caregivers becomes more challenging and creates many complex business considerations.

It is extremely difficult to coordinate and implement the integration of an entire health system, given their complexity. Numerous pieces have to fall into place for all the points of care, service lines, clinicians, support staff and administrators to unify as one system.

Some of these integrating pieces are much discussed, such as electronic medical records and governance. However, one aspect of integration is often overlooked, but can have a major impact on the efficiency and future success of an integrated system: logistics. More specifically, healthcare transportation as a part of logistics is especially important. Transportation touches nearly every area of an organization, as it is responsible for the system-wide movement of all patient- and business-critical materials, such as lab specimens, pharmaceuticals, supplies and medical records.

Healthcare transportation and integration

Done well, healthcare transportation can play a pivotal role in helping disparate organizations successfully integrate into a singular, integrated operating system. Utilizing a single source for healthcare transportation facilitates that process. "Pulling all [transportation] together through a single pipe is a tremendously integrating opportunity," says Jake Crampton, CEO of MedSpeed, a healthcare transportation solutions provider. "Transportation is an agent there to move a system from an environment of fragmentation to one of integration."

Advocate Health Care, based in Oak Brook, Ill., is an integrated healthcare system with 10 acute-care hospitals, two children's hospitals and more than 250 sites of care. However, according to Tom Lubotsky, vice president of supply chain and clinical resource management for Advocate, the facilities did not always work as one system. "Each hospital had its own courier-type service," he says of the system's old way of doing things. "It was very fragmented."

Chesterfield, Mo.-based Mercy had a similar problem. "When I first joined Mercy, we had eight different materials systems deployed across the system," says Vance Moore, senior vice president of operations at the health system. Facilities were making their own decisions on when and how to buy supplies and services, including transportation providers, he explains, which drove up costs for the system and simply wasn't efficient. Logistically, it was a jumble.

Conversely, a strong, centralized transportation network can help clean up the messy logistics brought on by integration efforts and can contribute to the overall success of an integrated health system.

Standardizing operations. A big driver of integration success is standardizing operations and implementing the use of best practices across the facilities of an entire organization. Utilizing a single source for medical transportation facilitates that process. "[Transportation] is a standardizing agent that can move things across an organization more cleanly," Mr. Crampton says.

Mr. Lubotsky believes that utilizing medical transportation is an important part of unifying the operations of a system. "We are consistently looking at our operations and what we can integrate as a system," he says of Advocate's integration efforts. "And [using MedSpeed as the sole provider of transportation services] falls in context of looking for ways to continually integrate and standardize our operations."

Mercy, too, has experienced the positive effects that a unified transportation system has on a health system's general integration efforts. "Transportation is such an integral part of an integration practice," Mr. Moore says.

Importantly, unifying transportation is not only an end in of itself but also a means to create other opportunities for operational standardization, according to Mr. Crampton. "By leveraging a robust transportation network, systems can move to central labs, central print shops, central distribution and so on – all of which brings greater uniformity to how the system works."

Culture of integration. Beyond standardizing transportation processes across an organization, implementing a system-wide transportation system can also promote a culture of integration throughout the system's hospitals, clinics and administrative offices.

Before integration became a growing trend in healthcare, there was a culture of facility-based orientation, not system-based orientation, according to Mr. Crampton, and that culture has to change for integration to be successful. "Transportation can be a part of cultural change," he explains.

A unified transportation system is unique when it comes to promoting a culture of integration because it is visual and touches every element of the operation of a system. Anything from acute-care hospitals, non-acute care physician offices and administration personnel see and interact with healthcare transportation on a weekly or even daily basis. "Because transportation touches everything, it is an especially visible and effective unifying agent," Mr. Crampton says.

"People get connected to [the people who visit their office every day], and the same thing happens culturally in a health system," Mr. Moore says. He has seen the cultural impact of a unified transportation system at Mercy. When the same driver comes to deliver supplies or pick up lab specimens, it can become a cultural mechanism to unify the system, according to Mr. Moore.

Value creation. Finally, in addition to unifying the system and giving care providers and administrators a cultural touchstone of integration, using a single source for healthcare transportation can give systems added value through long-term cost savings.

At Advocate, Mr. Lubotsky has seen first-hand the savings that unifying healthcare transportation can deliver. Advocate has used MedSpeed for years, and prior to 2012 was saving on a recurring basis about $360,000 each year on transportation from eliminating inefficiencies and standardizing deliveries through MedSpeed's services.

Increased healthcare transportation integration can lead to even greater savings, though. Since 2012, Advocate has deliveries dropped off at a central logistics center, instead of individual locations, and MedSpeed delivers the supplies to the various sites from there. "MedSpeed was going out to the clinics anyway, and we can now deliver supplies through MedSpeed for a lot less money," Mr. Lubotsky notes. Now, the system saves roughly an additional $800,000 each year on transportation.

According to Mr. Crampton, these significant savings opportunities can be several times the direct savings on transportation alone. The reason: "because a well-designed centralized network creates the mechanism to utilize network connectivity. The delivery and deployment of all goods and services throughout the network can be affected at zero or marginal incremental cost," says Mr. Crampton.

The overall impact: A unified, professional transportation system can help a health system physically and culturally integrate while helping achieve significant added value at the same time. In a more complex and pressure-filled healthcare environment, this is more important than ever.

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