Step 4 on the path to global sourcing for self-distributing hospitals

Global sourcing for hospitals and IDNs step 4: customization and continued product expansion.

Clinical utility and patient experience continually improve in the fourth element on your journey to a robust, value-based global sourcing program.

If you've made it through the third step on the path to a robust global sourcing program for your common, commoditized hospital products - unbundling your distributor rebate programs that are detrimental to your bottom line - congratulations! You are likely seeing 20-50% savings or greater on scores of items in the program representing millions of dollars saved every year. You will continue to see those savings year after year after year. And your clinicians and patients are enjoying higher quality products with greater clinical utility at the same time.

But now is not the time to stop. The next level of opportunities afforded through your global sourcing program include customized, branded products and continued transition of often overlooked products that have meaningful, direct impact on the patient experience.

Can customized, branded hospital products improve your HCAHPS scores? Two supply chain executives for leading U.S. hospital systems think so.

Westchester Medical Center Health Network's (WMC) current master plan calls for 24 patient care facilities under its umbrella. Marketing and patient satisfaction are rising rapidly on the priority initiatives and metrics.

"Our patient amenity and branded items are going to determine, at least in part, how we are perceived and measured including our HCAHPS scores," said Westchester Medical VP of Supply Chain Operations Jim Connor. "We are using global sourcing to ensure the quality of those are high while keeping costs low."

Connor tells the story of a board member who recently "hit one of the hospital's beds." The first critique from the board member was the quality of the toothbrush provided. "We hadn't changed that toothbrush in six years," Connor says. "We are changing that now.

"When you are charging a per diem rate for patients, or 'guests,' to stay with you, you should be able to provide high quality, comforting products without breaking the bank: pillow mints, shampoo, toothbrushes; all of those amenity products matter. At the price for a day in one of our beds, they should be the kind of items one would expect to find at a Four Seasons Hotel. We use our supply chain and procurement expertise along with our sourcing partner's capabilities to provide a higher quality experience for our patients."

Custom hospital or hospital branded products are also demonstrating increasing demand from purchasing executives seeking to add value and generate a competitive advantage by contributing to marketing and awareness. Branded amenity kits, pill cutters, maternity kits, pillows and more provide welcome, comforting goods that enhance the patient experience while simultaneously serving as subtle, but effective reminders of the hospital or IDNs market presence and capabilities for many eyes to see.

"I am confident that all of these efforts to improve the quality and utility of our hospital branded and patient amenity products in our global sourcing program improve our HCAHPS scores," says Northside Hospital Clinical Supply Chain Manager Kathy James, RN. In 2015, the system beat the U.S. industry average on 9 out of 10 Patient Experience metrics for Hospital Quality.

Maternity is a major practice for this particular system. With more than 10,000 births every year, products for newborns and their mothers are critically important to all concerned. ASP Global helped design and source a hospital branded long sleeved baby shirt with built-in "mittens" integrated into the sleeves to prevent infants from scratching themselves.

Sometimes the little things make all the difference.
Another specific example of product improvement that contributes to a higher level of patient satisfaction is cutlery. Have you ever tried to cut through a piece of chicken with a flimsy plastic knife? It can be absolutely maddening. Which would you prefer? The flimsy or the stout? Your global sourcing program and partner can provide the stout at the same price as the flimsy and immediately remove a patient pain point likely to improve the patient experience and associated HCAHPs scores at the very same time.

The lesson: never stop looking for opportunities to improve common, commoditized and disposable products. There are hundreds, if not thousands, available that should be part of your program by the time you reach step four.

Mandated drivers of change can bring value-based opportunities.
Occasionally a municipal mandate will drive hospital purchasing and supply chain managers to source new products. Case in point: New York City banned styrofoam cups in July 2015.
NewYork Presbyterian (NYP) scrambled to find an acceptable replacement and found it in a new NYP branded and coated paper cup. The potential impact of transitioning from foam to paper represented a cost increase, but NYP's global sourcing program and partner delivered a product at 10-15 percent savings with the NYP logo versus their distributor's best price on a comparable new paper cup.

In addition to branding, (which you can't do with Styrofoam) it's an environmentally friendlier product and it constantly diminishes waste stream costs as a recyclable product. According to Marketplace, new bans on foam containers took effect in the District of Columbia and Montgomery County, Maryland, in January of this year. Berkeley, California, outlawed them in the late 1980s as well.

The lesson: never stop looking for items to add to your global sourcing program. There are hundreds of products waiting to benefit from both quality improvement and branding opportunities that improve the patient experience frequently at 20-50% savings versus items acquired through your existing distributor relationship.

Coming soon: step 5 - how global sourcing enables you to effectively adapt to market shifts and top level clinical customization opportunities. Stay tuned!

About the author:
Lorne Tritt is Founder and CEO of ASP Global. With headquarters in Atlanta and operations in the Pacific Rim, ASP is a leader in global sourcing strategies and programs that enable IDNs, hospitals and large group practices to take advantage of lower costs and improved quality in hospital medical supplies available through direct sourcing, an efficient supply chain model and the global marketplace.

The views, opinions and positions expressed within these guest posts are those of the author alone and do not represent those of Becker's Hospital Review/Becker's Healthcare. The accuracy, completeness and validity of any statements made within this article are not guaranteed. We accept no liability for any errors, omissions or representations. The copyright of this content belongs to the author and any liability with regards to infringement of intellectual property rights remains with them.​

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