This
is the time
by Tom Hughes
It
can be helpful to occasionally pause, step off the speeding treadmill of
professional life, take a deep breath, and reflect on what is happening. As
an experienced veteran of the healthcare supply chain industry, when I
recently reflected on the current events happening around us, I quickly
realized that a significant forward shift is taking place in the healthcare
supply chain business. I believe this shift can be attributed to a number of
major factors that are simultaneously converging upon our industry.
Of course, healthcare reform
has to be considered the greatest factor impacting healthcare today.
The Affordable Care Act is
shifting healthcare’s focus from volume to value, and we are all adjusting.
Cost pressures on hospitals are severe; consolidation in every sector —
hospitals, suppliers, distributors, insurers, etc. — is likely. The
traditional hospital-centric approach to healthcare that we all grew up with
might soon be a memory. This new approach is seen at places like Advocate
Health Care, whose leaders are blazing a trail toward clinical integration
across the continuum of care. Other new models of care that go beyond the
traditional approach are emerging and supply chain professionals continue
the search to determine both the short term and long term adjustments that
are required.
Standardized supply data is
another major factor impacting supply chain. After decades of discussion and
debate, the supply chain data standards "movement" has finally gained
traction and is reaching critical mass, largely due to the unrelenting
support of visionary leaders from places like Mayo Clinic, Geisinger Health,
BD, and others. This movement recently received a major thrust from the
FDA’s proposed unique device identification ruling. It is reasonable to
believe that the exact UDI requirements of all supply chain stakeholders
will become clear, and the foundation for continued industry advances in
master data management will be demonstrated. The days of confusion
identifying products and locations are numbered (excuse the pun!) and the
reliability and exchangeability of our supply data should improve
significantly. With standardized care data and supply data in electronic
health records, our nation’s health and safety can be managed with a higher
degree of intelligence.
Physician involvement in
provider supply chain departments is growing rapidly. Not long ago, many
materials managers had little desire to engage with physicians and some
actually spent energy keeping doctors away from the supply business. Back
then, supply chain managers were defined more by successfully dealing with
suppliers (external) than by successfully dealing with physicians
(internal). The addition of nursing professionals in the mid-1980’s to both
provider and supplier teams may have actually served as the "bridge" to
today’s new organizational models where physicians are part of the team,
much like Cleveland Clinic who today has a surgeon as an integral member of
their progressive supply chain team.
Senior management support for
supply chain was something many professionals simply dreamed about in the
past. But today, Sr. Vice Presidents and VPs of Supply Chain are common in
integrated delivery networks, and Chief Supply Chain Officer (CSCO) is an
emerging title at progressive provider organizations like UPMC,
Intermountain Healthcare, and others. Recent increases in supply chain
executive salaries and packages reveal the strategic imperative that supply
chain has become in healthcare.
The explosion of technology at
every level of this business began many years ago, and is accelerating.
The technological progress and
new digitized features in medical products over the last decade have
resulted in enormous patient care advances. Today’s same-day surgeries were
often hospital stays just a few years ago. Improved technology continues to
drive positive changes, and the promise of more product advances in the next
decade will certainly help to continue this trend. Just as in other
industries, technology has changed the way business is conducted in
healthcare. Who remembers when purchase orders were routinely "called in" to
a supplier or when physical inventories were conducted with clipboards and
pencils? That has all changed. RFID tags, bar codes, sensing technologies,
and other technical advances helped end the age of "box kicking" while
ushering in the modern-day era of supply chain professionals as "high tech"
practitioners.
Another factor impacting our
industry today is the contribution by academia. Not that long ago,
universities paid little attention to the profession of supply chain, but
now their interest is growing rapidly. We already have many programs across
the country — such as the Center for Innovation in Healthcare Logistics at
the University of Arkansas, the Health Sector Supply Chain Research
Consortium at Arizona State University, and the Wharton Business School’s
healthcare supply chain program. Academia now recognizes, studies, and
contributes to the rapid evolution of healthcare supply chain.
There is an old saying "Be
careful what you wish for." For decades we have simultaneously craved
C-suite attention and status, we have dreamed about having clean data, hoped
for physician support, and been envious of other industries with their
scanners and technology. The hopes and dreams of the past are becoming
reality, albeit at different times in different organizations. Now is the
time for supply chain professionals — on all sides of every table — to
recognize this opportunity, to work together to propel our nation’s health
system forward in positive ways both clinically and financially, and to help
shape the future of our industry and profession by embracing and properly
implementing these new tools and resources.
Tom Hughes, a 40 year veteran
of the healthcare supply chain industry, is currently Executive Director of
Strategic Marketplace Initiative (SMI), a previous recipient of the AHRMM
Gossett Leadership Award, and an inductee of the Bellwether Class of 2012.