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Inventory Management

Inventory Management

Health Care Inventory Management - Henry Schein Medical

Coordinating and Managing to Your Non-Acute Supply Chain

The responsibility of distribution and cost savings for both acute and non-acute sites is a top priority for you and your team. With the rapid pace of growth and acquisitions, achieving efficiency in the non-acute space is becoming more difficult with limited resources.

Many supply chain leaders believe that applying the same processes and solutions that work in the acute space to the non-acute space will result in effective and efficient outcomes.

However, many underestimate the complexities that arise due to the fragmented nature of the non-acute segment. Applying a one-size fits all approach to your non-acute sites may waste time and resources while exposing your health system to significant risk.

Clinical staff and supply chain functions - Henry Schein Medical

According to the Health Industry Distributors Association, clinicians spend, on average, 20% of their workweek on inventory management and supply chain functions. That's over 400 hours a year per employee; this is way too much time spent away from patients. To make matters worse, these individuals are often not trained in supply chain best practices, making them more prone to mistakes that can lead to mishandled and wasted inventory.

While streamlining these processes and functions may be manageable in an acute setting, the sheer volume of different locations, staff members, and stocking locations in the non-acute segment increases cost exponentially.

Consider an IDN with 250 non-acute care sites, each of which has its own supply chain standards, processes, and technology. If just one nurse at each site is spending 20% of his or her time focused on supply chain functions, your system is wasting $3.5 million a year¹ in the non-acute space. This significant waste is a direct result of assigning nurses to handle tasks that they haven't been equipped to manage.

How much time are the clinical staff in your non-acute care sites spending on supply chain tasks?

Without a Non-Acute Partner, One Recall Triggers One Hundred Phone Calls

When the FDA announced a voluntary recall for sodium chloride in 2018, we had an affected customer with central distribution and management of about 100 non-acute sites. The supply chain director, Martha, was informed of the recall, but had no efficient way of identifying all the saline in her non-acute locations. She had to drop everything and make direct phone calls to 100 sites and identify which locations were impacted by the recall. These calls took her two full days to complete and countless hours were spent by the employees at each site to search, identify, record, and provide information on their saline supply.

On top of all of this, Martha had to reallocate existing resources to transport and process all of the recalled saline bags.

At the end of this ordeal, she questioned why there wasn't a more efficient way to manage this and future recalls.

How equipped are you to manage recalls across all of your non-acute locations?

What if you could eliminate the non-acute administrative burden that falls onto your team, allowing them to focus on more strategic priorities? Many supply chain leaders have transferred this burden to a distribution partner with a specific focus on the non-acute market. This allows them to decrease their risk and reallocate resources to focus on expense reduction, increasing efficiencies, and eliminating waste.

If you were to adopt a non-acute supply chain strategy like this, how would it impact your organization?

How Can A Non-Acute Distribution Partner Improve Your Supply Chain?

Contract Compliance
By conducting regular business reviews, at a frequency determined by the needs of your organization, your distribution partner can help uncover actionable insights from your total spend.

Formulary Standardization
A comprehensive formulary standardization process offers you options for all equipment and product categories, including premium, value, and economy brands, thereby maximizing the number of treatment options you can make available to patients. Work with your distribution partner to determine the offering that is right for your sites, one that will ultimately improve your cost savings and patient satisfaction.

Reimbursement Changes
Your distributor can help you effectively leverage the industry knowledge of manufacturing partners to help ensure that all levels of your health care organization are aware of reimbursement and technology changes.

Just-in-Time (JIT) Small Packages and Low UOM
Partnering with a distributor that is an expert in low unit-of-measure supply chains can provide you with efficiencies while ensuring order accuracy.

By leveraging non-acute expertise, you can ease the administrative burden, mitigate risk, and improve efficiencies by driving standards throughout the organization.

1. Assuming an average nurse's salary of $70,000 (https://www.bls.gov/ooh/healthcare/registered-nurses.htm)

Learn more about improving efficiency and minimizing risk in the articles below:

Improving Efficiency and Minimizing Risk
Inventory Management
Revenue Cycle Management
Point-of-Care Testing (POCT)
Telehealth