This SMI Forum, like SMI’s past action-oriented meetings, featured multiple breakout work sessions along with innovative presentations and educational sessions. While SMI’s trading partner members continued working on SMI industry initiatives, this Forum also featured physician perspective along with some new ground-breaking work that required SMI members to "look beyond the horizon" at topics like future supply costs compared to labor costs, and the SMI organization’s future direction and impact areas.

SMI members, all executive thought leaders from across the country, participated with invited guests and participants from the FDA, AHRMM, University of Arkansas Center for Innovation in Healthcare Logistics (CIHL), University of Kentucky Healthcare, Thomas Jefferson University Hospital, Healthcare Purchasing News, and GS1 US Healthcare. Said long-time SMI member Steve Huckabaa of Kettering Health Network, "The SMI Forums are powerful because the most innovative minds in the healthcare supply business go beyond talking about industry problems, they focus on the solutions to the problems and on putting those solutions into practice. SMI Forums are real work that produces positive change."

Strategic insight

The Forum jumped right into action with two popular "What Supply Chain Issues Keep Me Up At Night" sessions, featuring Ron Brady from Bon Secours Health System and Michael Rosenblatt from SSM Health Care. They each provided deep insight into the challenges and concerns facing today’s supply chain executives, with lots of questions and comments from Forum attendees. Brady shared that some of the topics that concern him include the industry’s limited capital resources, the impact of clinical integration efforts, and the rising energy and raw material costs. Rosenblatt intrigued his colleagues with his concerns about the increasing impact of direct-to-consumer marketing. He noted that many patients today are influenced by television, print advertising, and internet marketing campaigns, with the campaign effects surfacing later at the doctor’s office or other points in the healthcare delivery system.

Multiple breakout sessions

With little time to spare, Forum work included multiple breakout sessions to maximize participant input and impact. First, SMI Board members facilitated interactive member sessions about the industry’s challenges, SMI’s potential industry role, and what SMI and its members must do to shape an improved healthcare supply chain. Each session allowed the members and guests to engage in lively discussions about provider and supplier perspectives, industry challenges, priorities, and possible outcomes. The long lists of innovative member suggestions, concepts, and feedback are being used to guide the updating of SMI’s strategic direction.

Forum participants also continued their work on four specific SMI Industry Initiatives:

This SMI Initiative Team, led by Florence Doyle of Catholic Health East, finalized an eleven minute narrated video presentation designed to increase awareness and educate industry professionals on the "links" that connect supply chain responsibilities with revenue generation. The presentation, available at no charge from the SMI website, www.smi supplychain.com, includes recommendations that might assist revenue optimization efforts. "Our goal," said Doyle, "is to help industry professionals realize while we traditionally focus on costs, revenue factors exist and must be considered." The SMI Initiative Team and other SMI members will be using the narrated presentation to supplement their staff training and development efforts.

Realizing that increased utilization of EDI 810 transactions can not only yield process improvements but can also be a "green" initiative, the 810 Transaction Initiative Team finalized their work and introduced a multi-component 810 Toolkit that providers and suppliers can use as a collaborative tool to push 810 electronic invoicing levels to new levels. Team co-leaders Rammi Gill of GHX and Ed Robinson of OhioHealth worked with team members to finalize both a Provider and a Supplier implementation roadmap that assist trading partners in successfully implementing 810 electronic invoice transactions, bringing greater efficiencies to a business relationship. The two roadmaps are supplemented by an automated value calculator that can help trading partners estimate the financial potential of implementation. The full "810 Transaction Toolkit" for the industry is available for download from the SMI website.

The Vendor Managed Inventory (VMI) Initiative Team moved further toward completion as the vision and details for a progressive set of tools took shape in their breakout session. Led by Eric Nelson of Cardinal Health and Gary Wagner of The Methodist Hospital Health System, the VMI Team has studied management models within healthcare and outside of healthcare in the consumer goods and retail industries. The Team’s work is now focused on completing and testing two analytical tools and an implementation map that can assist trading partners to identify, quantify, and adopt a vendor managed inventory program determined to be of value.

SMI kicked off a new initiative focused on helping the supply chain executives forecast their future supply costs and compare then to future labor costs forecasts. With supply costs rising faster than labor costs in some regions, it is possible that future supply costs could exceed labor costs of an organization’s overall cost structure. Originated by the professionals at Resource Optimization and Innovation Inc. (ROi), a team of SMI providers led by Gene Kirtser, COO of ROi, is field testing the methodology and software platform that can support either detailed or high level costs forecasting. Once successfully tested at multiple sites, this forecasting process has the potential to support a provider’s strategic long term planning at the executive and board levels, altering the view and role of supply chain within the entire industry.

All of SMI’s active Initiative Teams will continue their work via conference calls, webinars, and e-mail to keep progress moving toward completion in the Spring of 2009.

When not working in their various small group breakout sessions, SMI Forum participants also received thought provoking presentations from physician senior executives, helping bring greater insight for Forum participants into the area of clinical integration with supply chain. David Reiter, MD, MBA, of the Thomas Jefferson University Hospital, a nationally recognized expert in value analysis, delivered an insightful presentation entitled Using Medical Evidence to Improve Outcomes in the Pay For Performance Era. Dr. Reiter energized the Forum participants with his presentation about clinical integration with supply chain, covering a wide range of topics including effectiveness versus efficiency, theories on clinical effectiveness cycles, and insight into various methods of research and how that information can be utilized in the supply chain world. The presentation also featured enlightening findings about the accuracies of web-based physician information.

Dr. Richard Lofgren, chief clinical officer at UK Healthcare (University of Kentucky), led a team of senior executives who informed Forum participants on the successful actions taken within UK Healthcare to keep clinical, financial, and supply chain efforts aligned and working together. SMI member Jean Sargent, vp of supply chain, and Sergio Melgar, CFO, joined Dr. Lofgren in the presentation entitled Unique Supply Chain Issues and Perspectives. Forum participants gained valuable insights into the successes and challenges that have been collectively experienced by all three presenters as they have worked together to advance the mission of UK Healthcare.

Consistent with the focus on near-future industry advances, Jay Crowley of the FDA did provide members an update entitled The Benefits and Challenges of Unique Device Identification. Dennis Harrison of GS1 US was also available to discuss the work of his organization and the progress being made toward the adoption of industry data standards.

Forum activities also included interactive luncheon round table discussions, where participants debated and discussed topics such as supply demand forecasting, alternate care service models, and "green" projects. Following luncheon rounds, Forum participants were updated on the significant progress that SMI members have made in adopting the tools and solutions created to-date. More than half of SMI’s members have incorporated an SMI tool into their organizations’ supply chain program. The use of SMI tools by non-members continues to climb as well. Activity statistics revealed that the new SMI website (www.smisupplychain.com) has rapidly become a popular industry resource, with visits and free tool downloads continuing to increase each month. SMI’s tools – among them Management Guidelines for Vendor Access, Perfect Order, and Measuring Effective Relationships – continue to be highly popular downloads.