Report challenges hospital executives’ current perception of supply chain management
Two new surveys indicate a possible discrepancy between hospital executives’ high-level view of the importance of clinical integration to supply chain and financial performance and the effectiveness of the actual on-the-ground approaches taking place in many health systems.
Nexera and Acurity conducted two separate surveys (with Modern Healthcare Custom Media and Becker’s Hospital Review) to determine hospital executives’ understanding of supply chain, related pain points, and strategies for clinical integration, sustainable cost reduction, and operational efficiencies. Nexera is a national healthcare consulting firm with roots in supply chain and performance improvement, and Acurity is an organization of healthcare professionals committed to helping providers deliver better care and reduce operating expenses through enhanced supply chain performance.
Regarding clinical integration, 66% polled said that they currently tie clinically integrated initiatives to the budget; however, only 5% of executives surveyed indicated clinical integration as their supply chain’s current priority. Perhaps most notably, when asked if clinicians are involved in formalized supply chain utilization and procurement decisions, the majority of senior and financial management professionals said yes, while the majority of clinical, operations, and materials professionals (all of whom are most central to this effort) said no. These discrepancies beg the question of whether the majority of health systems have a unified cost management strategy—with clear and accepted expectations—and if high-level goals are actually being conveyed to the front lines.
Seventy-three percent of hospital administrators stated that supply chain is tied to their cost management strategy. Fifty-three percent of those respondents answered that their institution has performed a coordinated supply chain assessment in the last two years, with 78% of those responding that it met their objectives for cost reduction and operational improvement. However, many of the same respondents then pinpointed cost reduction as their supply chain’s biggest priority—as well as the area that could use the most improvement—suggesting that the current strategies being employed have not been sustainable.
While nearly all respondents agreed that supply management plays a significant role in good margin control and the ability to establish a sustainable financial model in a patient-centered, highly reliable environment, other answers suggest that the current cost management strategies being employed may not be achieving the best results—especially if they do not prioritize a method for involving clinicians.
“It is encouraging to see that many executives recognize the importance of supply chain to their health system’s fiscal health and its ability to deliver quality care at a lower cost,” said Christopher O’Connor, President & CEO of Nexera and Acurity. “However, in order to make cost reduction initiatives truly sustainable, providers must involve clinicians. A unified structure—in which the goals of supply chain, clinical, and finance leaders are inextricably linked via targeted clinical initiatives that are tied to the budget—is the best way to achieve meaningful results and ensure long-term success. This requires a cultural change that comes from the top.”
Nexera and Acurity have documented the results of both surveys in a visual report.
About Nexera, Inc.
Nexera is a national healthcare consulting firm with roots in supply chain and performance improvement. Nexera ties total costs and care quality to financial reimbursements to deliver value-driven healthcare business results. By tailoring their work to client resources and culture, Nexera creates sustainable results for health system transformation.
About Acurity, Inc.
Acurity is an organization of healthcare professionals committed to helping providers deliver better care and reduce operating expenses through enhanced supply chain performance. Acurity has combined a regional contracting program with the power of national aggregation to deliver a best-in-class purchasing portfolio. Acurity’s leading industry experts identify data-driven methods that optimize hospital and health-system resources to improve both quality and the bottom line.
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