Healthcare Supply Chain 2017 - MaineHFMA Supply Chain 2017 April 27,2017 Jim Oliver ... Pharmacy 50...

Proprietary Confidential. All rights reserved. © Copyright 2014 1

Healthcare Supply Chain 2017April 27,2017

Jim OliverPresident & CEOYankee Alliance

[email protected]


Goal:

To provide some thoughts on trends and activitiestaking place in Healthcare Supply Chain today.

Mission

Cost Reduction

CollaborationInnovation

Work with our members to reduce supply and operating expenses

through the aggregation of data, purchasing, knowledge, and ideas

Proprietary Confidential. All rights reserved. © Copyright 2014

Membership Map

Member SitesAlternate Markets 612Ambulatory Care 1414Colleges/Universities 118Dentistry 3Durable Medical Equip 104First Responders 23Freestanding Lab 76Hlthcare Business-Other 583Home Care 2933Hospital 165Imaging Centers 224LTC Facilities 2450Pharmacy 50Physicians 5449Schools 70Surgery Centers 343

Total Sites = 14,617


“Medical supplies will outpace labor as thesingle biggest expense category for hospitals”

HHN magazine, AHRRM 12/11


Where does your supply chain executive sit in your organization?

Is your supply chain manager seen as a “Leader” in your facility?


Supply Chain KPI’s

Areas to consider tracking:

• Distribution/ Logistics/ Inventory

• Item Master/ Master Data Management

• Procurement/ Order Placing

• Sourcing and Contracting



Distribution/ Logistics/ Inventory• Inventory Turns• Dollars Issued• Average Dollars per Line• Days on Hand• Distribution Fill Rate• Inventory Carrying Costs• Inventory Value• Lines Issued• % of Dead Stock• Total Labor Cost• Total Lines Picked



Item Master/ Master Data Management

• % of Item Master Items under Contract

• Total Number of Items in the Item Master



• Procurement/ Order Placing

• # of Blanket Orders• eCommerce Utilization• Invoice First Time Match Rate• Percent of PO Spend• Purchase Orders Placed• Purchase Price Variance• Purchased Orders Dispatched per Person



• Sourcing and Contracting

• % Supply Cost per Net Patient Revenue• Total Supply Cost as a % of Total Operating Expense• Contract Compliance• Documented Savings• Inventory on hand• Supply Expense by Department


Purchasing

How much of your spend do you believe is on a contract?

Estimates are up to 40% of spend is not on a contract

How many of you use a GPO?

1 GPO?2 GPO’s3GPO’s

How many of you are actively rebidding GPO contracts?


GPO’s

Nationals:Vizient – VHA, UHC, MedAssets, Broadlane

Premier

HPG

Intelere (Amerinet)


GPO’s

Regionals:Yankee Alliance

NPC - Vizinent

Local Hospital Groups:Granite Health- NH

IDN’s: PartnersMaine HealthDartmouth Hitchcock


• The GPO Landscape is blurred

• National GPO’s cannot deliver compliance

• Contracting activity is becoming more regional

Where are you? What is your philosophy?Are all staff on the same page?


PPI/ Clinical Preference

National Contracts ineffective in this space?Benchmarking tools are necessary!

Who is responsible for negotiating these products?- Supply Chain?- Department Heads?- Clinicians?- Physicians?

Is it a team effort?

Price Benchmarking

Supply ChainProcess

(Sourcing/Contract Mgmt, PO/Invoice

Matching)

Imaging

Support Services (Facilities, FNS, EVS)

Admin(Collection,

Legal, Physician Contracts,

etc.)

Information Technology

• Disparate Responsibility & Accountability • Oversight & Management of Spend• Process – Sourcing & Contracting• Facility & Departmental

• Typically Inconsistent with PO/Invoice Matching Process

Fragmentation & Disparate ResponsibilitiesMagnitude of Spend(As Percentage of Total Operating Expenses)

Some of activities are often outside of normal Supply Chain activity

Why Purchased Services?

AP Audit Reports

AP Audit Reports

Accounts Payable Audit – Cleanse and categorize purchased service spend utilizing a facility’s accounts payable data. Identify

and prioritize opportunities for savings.

Initial Categories to Explore

Yankee Alliance Common Vendor Categories with Greatest Savings PotentialCATEGORY GROUP SUBMITTED

SPEND# OF VENDORS IN

ANALYSIS# OF

VENDORS INCOMMON

POTENTIAL SAVINGS

Staffing Services $16,593,818 113 15 $2,489,073

Telecommunications $7,705,309 38 6 $1,155,796

Power/ Energy Services $26,847,697 61 9 $3,892,916

Blood Services $6,305,004 3 1 $1,261,001

Yankee Alliance Common Vendor Categories with Greatest Savings Potential

• Led Lighting • Purchasing Cards • Call Answering and Paging Services

Pharmacy Services

• Contract Analysis – Review pharmacy purchases

• Help chose best product in category• Ensure best pricing

• Contracting– Aggregation for Enhanced Tiers

• Ex. McKesson Rx, IVIG, Zarxio, Eligard, Ryanodex

– Locally negotiated contracts• Ex. Tracelink, MEPS, CPS, Omnicell

22Proprietary & Confidential. © Copyright 2012

Pharmacy Contracting Dashboard

Proprietary & Confidential. © Copyright 2011 23


FOOD

Self Op vs. Contract Managed?

• Who gets the rebates?• Minimal competition in the Food Distribution world• How often and who negotiates your

Food Service Operations agreement?


Supply Utilization

“ The Holy Grail of Cost Savings”

It’s not about PRICE –It’s about Total Cost in Use

Price x Quantity Used/ Statistic

Pulse Oximetry Cost/ CMI Adjusted Patient Day

Value Ana lys is : Cl in ica l Product Ut i l i za t ion

Non Existent

New Product Introduction

GPO Contracts

Standardization Clinical Product Utilization

PRICE FOCUS

Average Potential Savings:• Commodity Contracts: 1 ‒ 3%• PPI: 5 – 7%

Average Potential Savings:• Utilization: 10 – 25%

VALUE ANALYSIS

FUNCTION FOCUS

Forward thinking health systems are moving beyond price to tackle utilization opportunities.

Clinical Value AnalysisA systematic process to review clinical products, equipment and technologies to evaluate their clinical efficacy, safety and impact on organizational resources. The ultimate goal is to reduce cost while maintaining quality, safety, best practices and patient outcomes.

27Proprietary Confidential. All rights reserved. © Copyright 2014

Value Analysis Organizations


AHVAP Vision:Value Analysis is recognized as an essential component of the delivery of healthcare. The Association of Healthcare Value Analysis Professionals is nationally recognized as the preeminent clinical resource in providing education, resources and networking to its membership and promoting Value Analysis in the healthcare community.

Key Concepts

• Executive Support• Culture• Current VA Structure

– Product Review Committee

• Policy • Identify Stakeholders• Establish Trust and Credibility


Organizational Wide Alignment

Identify and Engage Stakeholders• Clinicians• Management • Medical Staff• Ancillary Staff• Environmental Services• Specialty Services• In/Outpatient Services


VA Organizational Structure


Executive Steering Committee

Multi Disciplinary VA Committee

OR/EndoVA Committee

Champion Teams

Value Analysis Process


• Understanding– Collect data, usage,

literature review, interviews

• Investigation– Analyze cost, usage,

utilization• Analytical

– Develop cost analysis, identify stakeholders

• Planning – Collaborate with end

users, develop implementation strategy

• Implementation – Identify need for

education and assist with executing projects

• Evaluation – Report, document and

validate savings

Track and Trend

• Savings Tracker– All Documented Savings – Updated Monthly – Sent to MM Directors and CFO

• Project Tracker– All Initiatives

• Active• Completed• Rejected

– Lost Savings Opportunities



Goal of Utilization

• Align product mix and usage with established best practices

• Ensure best practice is followed throughout the system

Identify savings opportunities, beyond price points and contracts,

that focus on product selection and clinical practice.

• How do you use what you purchase?• How should you use what you purchase? • What characteristics are essential for best practice?• What is causing mis-use or variation?


Utilization in ActionHow can product variation identify clinical variation?

Blue.Point Categorization

IV Primary Tubing

Luer Lock

Short Length

Medium Length

Long Length

Specialty Tubing

Burette Filter Drug Specific Stopcock

Add-Ons

ExtensionTubing Burette Stopcock

Access-oriesSplit Septum

0 Ports

1 Port

2 Ports

3 Ports Any combination of blocks can be

compared to other hospitals!



Where to Begin?

• 86 B.P Categories• Prioritize projects• Pipeline of savings

opportunities

Action Plan: Why are we different? What next?

Category Information• Name• Statistic• Date range

Top Performers• 25% of facilities with the lowest

category spend per statistic

Facility Data Analysis

Best Practice Checklist• Clinical information that

pairs with the analysis

Facility Information• Statistic , CMI, Total Spend

Check Boxes• Check when Action

Item is completed

Your Spend• The facility’s category spend

per statistic



CLARITY™ Web Application

Category Summary Dashboard

• Project Pipeline

81


Clarity: Visibility to Sustainable Savings


3 Hospital System Usage Over Time


General Nurs ing Por t fo l io1. Advanced Wound Care

2. Bedside Bags and Basins

3. Blood Pressure Cuffs

4. Casting and Splinting

5. Centesis Products: Abd & Chest

6. Central Line Dressing Kits

7. Cold Therapy

8. Disposable Patient Transfer Devices

9. DVT Prevention

10. ECG Monitoring Electrodes

11. Exam Gloves

12. Flush Syringes

13. General Urologicals

14. General Suction

15. Germicidal Dressings

16. Incontinence Products

17. IV Access: Central

18. IV Access: Peripheral & Ext. Sets

19. IV Blood Tubing

20. IV Primary Tubing

21. IV Secondary Tubing

22. IV Start Kits

23. Irrigation Products

24. Mechanical Ventilation

25. Medical Tape

26. NG Tubes and Enteral Feeding

27. Needles & Syringes

28. NPWT Disposables

29. Oxygen Supplies

30. Patient Care Products

31. Patient Cleansing

32. Patient Pillows

33. Patient Slippers

34. Point of Care Testing

35. Pulse Oximetry

36. Saline

37. Skin Substitutes

38. Temperature Management

39. Tracheostomy Products


Operat ing Room Port fo l io1. Anesthesia Breathing Circuits

2. Arthroscopic Blades & Burrs

3. Biosurgical Hemostasis+

4. Bone Void Fillers

5. Chest Drains & Systems

6. Clip Appliers

7. Coronary Stents

8. Disposable Laparoscopic Scissors

9. Epidural Trays

10. Hair Clippers & Blades

11. Insufflation Tubing and Needles

12. Internal Staplers

13. Laparoscopic Sutures

14. LMA’s & ETT’s

16. Orthopedic Bone Cement

17. Orthopedic Hoods

18. Orthopedic Reinfusion

19. External Patient Warmers

20. Internal Patient Warmers

21. Pneumatic Tourniquets

22. Ports & Huber Needles

23. Specimen Retrieval

24. Spinal Trays

25. Suction Irrigators

26. Surgical Drainage Products

27. Surgical Hand Preps

28. Surgeon Gloves

29. Surgical Mesh

30. Surgical PPE

31. Suture Anchors

32. Sutures

33. Topical Wound Sealants

34. Trocars

35. Vascular Closure Devices

36. Vena Cava Filters

37. Vessel Sealing Devices

+ Requires alternate data source


Anci l lary Serv ices Por t fo l io

1. Blood Culture Bottles

2. Can Liners

3. High Level Disinfectants

4. Low Level Disinfectants

5. Phlebotomy

6. Rapid Test Kits: Flu

7. Rapid Test Kits: Strep

8. Rapid Test Kits: O&P

9. Sterilization Products

10. Vacuum Blood Tubes

• f an

Medication Evaluation Studies

• Components of an ME– Executive Summary– Action Plan:

• Slide deck with member specific data• Supporting evidence – Annotated references• Physician’s letters• Order sets• Protocols

– Offer to co-present or coach for P & T approval



Questions ??

Thank You

Healthcare Supply Chain 2017 - MaineHFMA Supply Chain 2017 April 27,2017 Jim Oliver ... Pharmacy 50...

Documents

Transcript of Healthcare Supply Chain 2017 - MaineHFMA Supply Chain 2017 April 27,2017 Jim Oliver ... Pharmacy 50...