Supply chain deficincies in hospital operating rooms

Despite the fact the healthcare industry is fueled by scientific advancement, too many hospitals find themselves stalled at a crossroads, struggling to embrace business-focused technologies and best practices that will allow them to flourish in the decades to come. This is the troubling picture painted by results of a new independent survey released today by GHX. 

The GHX survey of hospital senior executives indicates that operating room (OR) supply chain deficiencies have slowed organizational decision-making, increased costs and inefficiency -- and ultimately impact the delivery of patient care.  (Click here to view survey infographic).

“Today there aren’t widely-adopted, end-to-end supply chain management processes for implantable devices as there are for medical-surgical supplies. As a result, the operating room has become one of the most siloed areas in a hospital,” said Bruce Johnson, president and CEO, GHX. “Implantable devices are estimated to account for approximately $50 billion as a market segment. Lack of visibility and control over these devices cost the healthcare industry an estimated $5 billion per year from inefficient manual processes, and lost, expired and wasted product. Until suppliers and providers fully embrace technology to streamline processes and reduce waste, our nation’s healthcare system will never be able to lower costs for consumers in any meaningful way.”

Key Research Findings:

Too Many Hospitals Stuck in the Supply Chain “Stone Age”

·         Survey results showed that 79 percent of senior hospital executives say keeping supply chain costs down is important to addressing key financial challenges, such as a decline in profit margins and shrinking reimbursements from government and private payers. Yet, 78 percent of respondents report hospitals are playing catch-up in terms of implementing effective supply chain technology solutions.  And one-in-five (18 percent) say they’re still stuck in the “Stone Age” – dramatically lagging behind where they could and should be. 

The Lack of Supply-Chain Visibility in the OR Comes at a High Cost

·         Nearly two in three executives “strongly agree/agree” that their hospital lacks real-time reports (62 percent) and advanced modeling techniques to inform decision-making (65 percent) when it comes to their hospital’s implantable medical device supply chain, making the streamlining of delivery of care in their hospital an even more significant hurdle. 

·         Seventy percent of respondents say excess clinical time spent on inventory replenishment is a “very” or “somewhat significant” challenge to their hospital’s operating room. Almost half of respondents (45 percent) “strongly agree/agree” there is a lack of accurate implantable medical device supply chain reports. 

“Where’s that Hip When I Need It?” – Supply Chain Failings Trigger Procedure Delays, Recall Challenges for Hospital ORs

·         Especially alarming is the role the supply chain plays in potentially having an adverse impact on efficiency and cost savings in the operating room:

-         55 percent of respondents say that surgical procedure delays due to sales reps ordering medical-surgical devices are a “very” or “somewhat significant” challenge.

-         53 percent of respondents say staff ability to locate medical-surgical supplies when needed is a “very” or “somewhat significant” challenge.

-         And perhaps most concerning of all: despite the fact that 74 percent of respondents report their hospital has a system that allows them to track (and recall, if necessary) devices that are implanted in specific patients, nearly half of all respondents (47 percent) admit it would be “very difficult” or “somewhat difficult” to track patients with implantable devices if there was a recall on a particular device.

“As an industry, we must commit to transforming healthcare by reducing costs and delivering more cost-effective, high-quality patient care,” added Johnson. “That’s why GHX set out to achieve our ‘5-in-5’ goal, which aims to take $5 billion out of the cost of healthcare during the five year program, ending December 31, 2014. Stripping out these unnecessary supply chain costs is the key to keeping time, money and resources focused on the patient.”

The online survey was conducted December 4-13, 2013 by KRC Research. KRC Research surveyed 75 senior executives within hospitals larger than 125 licensed beds who have decision-making authority or influence related to the purchase and management of implantable medical devices in the operating room.

About GHX

Global Healthcare Exchange, LLC (GHX) is driving costs out of healthcare by transforming the healthcare supply chain. Working with providers and suppliers, GHX is accelerating change by providing a faster, more efficient and collaborative supply chain that will take billions of dollars out of the cost of healthcare. For more information, visit www.ghx.com and The Healthcare Hub.