Exploring the Role of Supply Chain Management in Healthcare

How many lessons have we learned from the Covid-19 pandemic?

1. Plans to deal with health emergencies alone are not enough to deal with crises. A written battle plan will not work until the proper and adequate support and training are part of the plan. This requires annual inventory and sufficient workers (in reserve) to meet the needs.  All manuals must be dated and reviewed annually.  Diagnostic testing and treatment protocols can change quickly with the new condensed development times for testing and treatments.

2. Expect routine supply chains (wholesale distribution, transportation, and trucking services to be disrupted, so that new supply chains must be readily available. Rather than using normal distribution channels, alternative delivery services can be utilized, such as USPS, UPS, FedEx, DHL, and Amazon Fulfillment Centers can be brought online quickly. The lack of PPE, sanitizing solutions is a critical product for controlling the spread of infection.

3. The workforce will be disrupted by public health measures such as distancing and a  possible lockdown to prevent further spread of infectious diseases.  Public services such as light rail, bus transportation, airlines may become unavailable.

New York Subway during Covid19 Lockdown

TSA at Airport

Artificial intelligence and machine learning must be developed to study this pandemic to model for inevitable future events.  Historical stories may not be applicable comparing 1919 (Spanish flu) with SARS, MERS, nor COVID-19.  Projections into the future may not be valid when shifts in technology occur. For instance, the changes in transportation (airline flight), medical technology (diagnostic testing, treatments, and the use of new forms of medication and vaccine development.)

The use of newer forms of vaccine manufacturing using RNA technology vs the use of introducing foreign proteins in the body to form an immune reaction.

     How can providers overcome common challenges in healthcare supply chain management?

Some healthcare organizations have found success with supply chain management through cost transparency. By harnessing price and utilization data, healthcare organizations can track and manage inventory more efficiently and construct more informed purchasing contracts with manufacturers.

“Due to vertical internal structures, supplies and supply data historically have been siloed and firewalled so that information important for efficient business operations is fragmented,” Steve Kiewiet, Vice President of Supply Chain Operations at BJC HealthCare, told RevCycleIntelligence.com in June 2015. “We end up spending billions of dollars of inventory within these various silos because we live in a world where you can never run out of anything ever, in the interest of what is best for the patient.”   

All of these factors operate during 'normal times: If a public health emergency occurs, all bets are off.  Typical laws of economics, supply and demand begin to operate, and costs soar as manufacturers seek to profit.

During the current Covid-19 pandemic prices soared for masks and sanitizers and all other     PPE. Hoarding and preferential sales to emergency workers, hospitals, and essential workers prevented almost everyone else from obtaining needed PPE.
Gowns up 2,000%

The largest reported price increases have been for isolation gowns (2,000%), N95 masks (1,513%), 3-ply masks (1,500%), and reusable face shields (900%). The most remarkable rise was for 3M N95 masks, which rose from $0.11 to $6.75 each (6,136% increase), though they are currently unavailable, according to SHOPP.
Present and Future Price Trends

Wild Card Vendors/suppliers/manufacturers

The widespread use of online shopping has given visibility to many DIYers who manufacture small orders for masks. The potential for the small home-based business to manufacture face masks and protective eye shields.  This niche market is also driven by word of mouth at hospitals and is also available on Youtube

Exploring the Role of Supply Chain Management in Healthcare