The evolution of health care businesses over the past few years has often involved these companies becoming more like organizations in other industries. Due to the essential and literally life-saving work that goes on in hospitals and other care facilities, it can be tempting to consider the medical world separate from general enterprise operations.
That kind of hard-and-fast separation can lead to missed opportunities, however. The latest efficiency-building technologies and techniques changing supply chains in general will make welcome additions to the health care toolkit.
The fact that changes to health care procurement efforts can have a direct effect on patients' care and health outcomes shouldn't make leaders timid about updating their processes. Instead, they should be actively pursuing new methodologies, looking for ways to make their whole organizations better.
Entering the consumer-goods chain
As Spend Matters recently pointed out, there is a major opportunity for hospitals and other care facilities to create more comfortable and safe environments for patients. While the site described the relationship between health care systems and e-commerce goods providers as "conspicuously absent," there is a great opportunity for hospitals to buy from online sellers.
Hospitals that focus their procurements entirely on health care-specific purchasing may not be providing comforting basics for their patients. The experience of receiving care has gained focus in recent years, and this involves providing what Spend Matters described as "a healthy meal, comfortable bedding and a good internet connection."
Recent years have seen the rise of products that blur the line between consumer goods and professional health care investments. Spend Matters pointed to a line of anti-microbial sheets that will be sold to home shoppers via QVC. The products are also available to hospitals, and the manufacturer behind them made sure to establish a contract with a care system during the launch period.
Seizing new opportunities to change and improve patient experiences is a concept hospital leaders should seriously consider over the years ahead. Changing sourcing practices to create savings and efficiencies is another such priority, related but distinct. As Healthcare Finance News reported in late 2017, general supply chain spending takes up 30 percent of hospital budgets, making it the second-most expensive line item after paying staff. Using better practices to cut those expenditures is a valuable priority.
The source pointed out that recent research has discovered that some areas of the supply chain are far better at delivering monetary savings than others. Medical-only commodities are fairly set in their prices, with large organizations controlling distribution. Furthermore, pharmaceutical prices are also out of administrators' hands.
The actual products that have highly variable prices, and that can therefore provide bargains, are medical appliances and supplies dictated by physician preference. Supplier representatives may drive costs up by creating direct links with physicians, a practice that has been mostly eliminated when it comes to pharmaceuticals.
However they accomplish care improvements and cost savings, leaders in the medical world should be unafraid to explore possible supply chain changes in the near future. The world of hospitals is becoming more like other consumer-focused inventories, and that means competing and improving over time are core values.