Hospitals consolidating product lines datings in ireland religious
When Mercy Health began partnering with Medline, a medical supply manufacturer and distributor, in April 2017, products flowing through its medical-surgical distribution channel were 2% standardized. Mercy has also slashed its distribution centers from 14 to two and reduced its manufacturers by 50%, according to a Medline case study provided to Supply Chain Dive.
Mercy Health's integrated delivery network — which has about 500 health care facilities serving Ohio and Kentucky — is at the cutting edge of a growing trend among health systems.
Slashing layers in the distribution process allows health systems to streamline their deliveries, as Medline and Mercy's partnership attests.
Most of Medline's volume is in bulk distribution form, but there's a growing trend toward using a lowest-unit-of-measure delivery system, Jones said.
Before its partnership with Medline, 85% of Mercy's supply chain staff had to procure and distribute commodity products such as gloves and plastics — which constituted a mere 17% of the budget.
In general, health systems are using more automation to streamline data, reduce inaccuracies and improve interfaces.
Standardizing inventory products not only helps physicians and nurses, who often work at various locations, but also patients, who "may benefit from consistent medical supplies and clinicians’ care received regardless of the care setting of the IDN they visit," Rochelle Waterhouse, director of marketing for acute care at Medline, told Supply Chain Dive.
Labor constitutes the largest portion of health system costs, but supply chains take second place at as much as 30% to 35% of costs — and that percentage might be growing.
Faced with lower reimbursements and inpatient volumes, most health systems have already implemented standard cost-cutting measures, and now need new places to trim. "Previously integration was more horizontal (across like organizations) where today integration is more vertical in health care and crossing state lines into different health care markets," said Barbara Giacomelli, vice president strategy of Mc Kesson Rx O, in comments provided to Supply Chain Dive.
"The Affordable Care Act has impacted integration as health care organizations strive to provide a full continuum of care to patients." Crucial to consolidation, partnerships take different forms.