How standards support supply continuity

March 23, 2020

Significant disruptions in the healthcare supply chain, whether from natural disasters, major recalls, or more recently the impacts of COVID-19, are raising awareness about the importance of standardization, whether it be in how we identify products or locations, or how we report potential or actual supply continuity risks. In this month’s issue of Standard Practices, we explore the role of standards through the collaborative work underway between the Strategic Marketplace Initiative (SMI) and the Health Industry Distributors Association (HIDA), as well as the AHRMM Learning UDI Community (LUC) UDIs in Recalls work group.

Even before the surgical gowns recall, the closure of sterilization facilities, and the impacts of COVID-19 became apparent, both SMI and HIDA had launched supply continuity and visibility initiatives. While still a work in progress, SMI consultant John Lebowitz says they are uncovering challenges associated with a lack of standards.

Standardizing essential product lists: The SMI Initiative team is seeking to standardize a list of the 100 or so essential products that a hospital would never want to operate without. Such lists are not new, but different healthcare systems often create their own lists in isolation and manage the inventory of those products independently. At a global level, the World Health Organization (WHO) has developed what it calls Priority Medical Products lists for “specific preventive, diagnostic, treatment or rehabilitation procedures carried out in most health care facilities.”  More on that to follow.

Standardizing supply risk reporting: Once a standardized essential product list is created, the SMI team plans to work with supply risk experts to create a tool to help providers assess upstream supply disruptions for those products based on their specific vendors and where their products are manufactured. One of the companies participating in the initiative, Resilinc, created a standardized template that manufacturers, across multiple industries, can use to report supply continuity data to their customers. CEO and founder Bindiya Vakil recognized, when she worked for CISCO, that completing different templates for individual customers was increasing costs for manufacturers, and was the impetus behind Resilinc. 

A role for standard identifiers: Currently, the Resilinc tool uses whatever part numbers manufacturers and providers say they use to identify products in question. Conceivably, if both manufacturers and providers were to use an industry standard identifier, such as a unique device identifier (UDI-DI), it would be easier for all involved, from trading partners to technology companies, to manage the data.  Identifying locations where products are produced could similarly be more easily managed with the use of an industry standard such as the GS1 Global Location Number (GLN) if shared across parties.

The value of visibility: Once they start monitoring supply risk, Vikal says many buying organizations often realize they only have the location for a vendor’s corporate office and not where the products are actually produced. With better visibility, trading partners can proactively develop contingency plans based on identified risks. For example, if a devasting hurricane is headed toward a manufacturing location, such as when Maria hit the island of Puerto Rico, both buying and selling organizations could proactively identify which facilities and products may be at risk and start identifying alternate sources of supply should a disruption occur. 

Classification is key: As part of its global efforts, especially for developing countries, the WHO is working on a new medical device nomenclature to help manage priority product supplies. WHO recognizes that there are numerous schemas in use for different purposes, e.g., procurement, accounting, stock keeping, regulatory affairs, adverse medical device event reporting, and customs operations. WHO is coordinating with those other systems, including the Global Medical Device Nomenclature (GMDN), which is part of the required data for the U.S. UDI rule, and the new European Medical Device Nomenclature being developed as part of the European Medical Device Regulation (MDR) that includes UDI requirements. The WHO nomenclature would be freely available to all stakeholders and exportable to healthcare information systems, making it easily used for tracking as an element associated with UDI-DIs. If a specific product on the priority list is in short supply, for whatever reason, a classification code linked to the UDI-DI for that product can help identify other products that could be purchased as alternatives.  

Standard communications around supply continuity: Optimizing visibility around supply continuity is also enhanced by standardizing how backorders are communicated. In a 2013 best practices paper on communicating line order status on purchase order acknowledgements (POAs), GHX recommended suppliers use standardized codes to communicate various types of backorders, as follows:

Recall communications: In early discussions, the AHRMM LUC UDIs in Recalls workgroup noted how recall responses can be streamlined if manufacturers were to use UDIs in recall notices and if providers were to electronically capture UDIs for products purchased, held in stock and/or used in patient care electronically. Digitization combined with standardization across systems and organizations can improve response time and patient safety.

Shortage communication: Finally, FDA Commissioner Stephen Hahn has called on manufacturers and providers to voluntarily report supply shortages related to COVID-19. If those communications also included UDIs, think of how we could more easily identify alternate sources elsewhere in the system to meet the demand, either in the form of excess inventory at other hospitals, or by using classification systems to identify and locate substitutions.

How are standards helping you respond to supply shortages? I’d love to hear from you. [email protected] 

About the Author

Karen Conway | CEO, Value Works

Karen Conway applies her knowledge of supply chain operations and systems thinking to align data and processes to improve health outcomes and the performance of organizations upon which an effective healthcare system depends.  After retiring in 2024 from GHX, where she served as Vice President of Healthcare Value, Conway established ValueWorks to advance the role of supply chain to achieve a value-based healthcare system that optimizes the cost and quality of care, while improving both equity and sustainability in care delivery. Conway is former national chair of AHRMM, the supply chain association for the American Hospital Association, and an honorary member of the Health Care Supplies Association in the UK.

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