February 2021 • Vol.17 • No.1
Building a Resilient Supply Chain This year’s Contracting Professional of the Year helped to develop and implement unique solutions to supply chain challenges brought on by the pandemic. Amanda Chawla, Chief Supply Chain Officer, VP at Stanford Health Care, Stanford Children’s Health & Stanford-Valley Care
VISUALLY INSPECT WITH REMARKABLE CLARITY The FIS includes a distal �p composed of a light source and camera lens at the end of a 110cm flexible sha�, which features gradua�on marks. The Flexible Inspec�on Scope is a perfect tool to get a visualiza�on of any poten�ally soiled device. So�ware is included and allows viewing and recording.
FIS-005SK 110CM LONG 2.0MM DIAMETER
FIS-006SK 110CM LONG 1.3MM DIAMETER
HEALTHMARK OFFERS MANY OPTICAL INSPECTION TOOLS TO SUIT YOUR NEEDS
MAGIC TOUCH MAGNIFIER
HANDHELD MULTI-MAGNIFIER
MADE IN AMERICA MAGNIFIER
HEALTHMARK INDUSTRIES CO. | HMARK.COM | 800.521.6224 | HEALTHMARK@HMARK.COM
4X LED MAGNIFIER
CONTENTS
»» FEBRUARY 2021 Amanda Chawla, Chief Supply Chain Officer, VP at Stanford Health Care, Stanford Children’s Health & Stanford-Valley Care
The Journal of Healthcare Contracting is published bi-monthly by Share Moving Media 1735 N. Brown Rd. Ste. 140 Lawrenceville, GA 30043-8153 Phone: 770/263-5262 FAX: 770/236-8023 e-mail: info@jhconline.com www.jhconline.com
Editorial Staff Editor Graham Garrison ggarrison@sharemovingmedia.com
Art Director Brent Cashman bcashman@sharemovingmedia.com
Feature
Publisher John Pritchard
Contracting Professional of the Year » pg14
jpritchard@sharemovingmedia.com
Vice President of Sales Katie Educate keducate@sharemovingmedia.com
Circulation Laura Gantert lgantert@sharemovingmedia.com
2 Publisher’s Letter: To 2021 … And Beyond! 4
The Journal of Healthcare Contracting (ISSN 1548-4165) is published monthly by Share Moving Media, 1735 N. Brown Rd. Ste. 140, Lawrenceville, GA 30043-8153. Copyright 2021 by Share Moving Media. All rights reserved. Subscriptions: $48 per year. If you would like to subscribe or notify us of address changes, please contact us at the above numbers or address. POSTMASTER: Send address changes to Share Moving Media, 1735 N. Brown Rd. Ste. 140, Lawrenceville, GA 30043-8153. Please note: The acceptance of advertising or products mentioned by contributing authors does not constitute endorsement by the publisher. Publisher cannot accept responsibility for the correctness of an opinion expressed by
Serving on the Front Lines Emergency physicians were tired, but determined, amid rising hospitalization rates and COVID cases.
24 How Would You Grow Your GPO? 28 Beyond Four Walls Today’s consolidated service centers require well-thought-out strategies in order to effectively meet the goals of their overarching organizations.
32 UV-C Disinfection in the Limelight Next to front-line workers and Anthony Fauci, mobile ultraviolet ‘robots’ could be the pandemic’s biggest rock stars.
contributing authors.
The Journal of Healthcare Contracting | February 2021
36 Managing Through Difficult Times National Account Executive of the Year said patience, bold visions will lead the way in 2021
37 Drafting a New Playbook Why the game plan for healthcare supply chain distribution needs to change now
40 The Healthcare Landscape in 2021 Key trends to watch
42 Frustrated By Glove Shortages? Talk with your distributor about alternatives and conservation strategies
43 Calendar 44 Two Things People Get Wrong About Purpose 46 Industry News
1
PUBLISHER’S LETTER
JOHN PRITCHARD
To 2021 … And Beyond! Wow, what a year of change. It really is true that the one thing you can count on is change. Everything seems to have changed this past year thanks to the pandemic. As it pertains to the healthcare supply chain, I see a lot of long-standing norms that we’ve enjoyed for years not coming back soon, if ever. All of this unwelcomed change adds more questions than answers as we plan, prepare and forecast for 2021. Will we ever convene again in a conference-like seminar? I sure hope so, but it will look totally different. Conferences and expositions may be held outdoors or in much larger and more vacuous places. The days of people sitting in a booth for a few hours at a time don’t seem to be on the horizon anytime soon. I think we’re likely to see more panel discussions and keynotes, maybe even where the presenter is pre-recorded. What will business meetings look like? Whether it’s a quarterly business review, sales call or a product in service, what will these interactions look like? My tea leaves show these will be fewer and far between. During the pandemic we’ve learned many of these meetings were routine but maybe not necessary. I think incumbent suppliers are going to retain market share more easily than in the past few years when buyers were more accessible and open to hearing and seeing innovative products and services. What about interviewing new candidates? A year ago, I couldn’t imagine hiring someone that I hadn’t met in person a couple of times and at least enjoyed a meal together. In this era, I think we will see a lot of people hiring people they already know or someone they know only virtually. That is strange to think how the norms of the hiring process can go entirely online. It’s interesting to think how in years past my professional network grew every year. Usually it was from meeting someone at an industry event collaborating on a project. I flew three times in 2020 – once for work and twice personally. To me this industry has always been about the people, not the clinical value proposition or even the great institutes we cover. I for one long for when we can re-connect, shake hands and expand our networks in person again.
To me this industry has always been about the people, not the clinical value proposition or even the great institutes we cover.
Thanks for reading this issue of The Journal of Healthcare Contracting.
2
February 2021 | The Journal of Healthcare Contracting
It’s our core values that bring us together as one family.
Better Future Enhancing Family & Community Health
Trusted Partnerships
Introducing the Dukal Family Crest. For the past three decades, Dukal has evolved with the ever-changing healthcare industry. Now we are strengthening our voice and evolving our brand with a visionary new look.
Visit our new website Dukal.com
As a leader in the development and manufacturing of medical products we partner with healthcare professionals to launch innovative solutions to unmet clinical needs.
EXECUTIVE INTERVIEW
Serving on the Front Lines Emergency physicians were tired, but determined, amid rising hospitalization rates and COVID cases.
Dr. Ryan Stanton, an emergency physician practicing in Kentucky, didn’t have to think long about what words he would use to sum up how he feels after months of providing emergency care amid the COVID-19 pandemic.
4
February 2021 | The Journal of Healthcare Contracting
REBUILDING TOGETHER On the journey of health care delivery, the pandemic presents an unexpected detour. Henry Schein Medical is committed to provide you with the resources you need to rebuild your practice.
To learn more, visit HenrySchein.com/RebuildTogether
EXECUTIVE INTERVIEW
“Fatigued and tired,” he said. “Everybody’s worn out.” Indeed, the nation’s frontline
get together, we can’t do the things that we used to do for team building. Then you’re especially nervous because
Dr. Stanton: The shortages are twofold. In my situation, I started getting symptoms Thanksgiving week, so it was
caregivers have paid a physical, mental,
a lot of folks outside the hospital feel like
hard to get a test to confirm it. I had
and emotional toll in fighting the pan-
you’re always contagious. So we have friends
shifts coming up, so I was worried about
demic. Record-breaking hospitalization
that haven’t been willing to talk to us since
getting those shifts covered. Thankfully
rates have taxed emergency physicians
the onset because we’re in healthcare and
for me it went very smoothly.
and emergency department staff in un-
they feel like we’re a Typhoid Mary, just
precedented ways. Dr. Stanton, a board
waiting to spread COVID to everybody.
member of the American College of
Then there were the initial frustrations
But for the nursing situation, you have exposures, people are out and of course the changing amount of time that it’s go-
Emergency Physicians (ACEP), talked
with lack of PPE, or adequate PPE, when
ing to be – whether it’s 10 days, 14 days,
to The Journal of Healthcare Contracting
you’d start opening up masks and all the
etc., A lot of hospitals and facilities have
about the challenges, and the repercus-
instructions are in Chinese.
models where even with exposure you
sions for emergency departments and healthcare as a whole moving forward.
And even now with the vaccine. Most that have access to it are overjoyed. But
still work unless you develop symptoms, because some people were taking advantage of it.
There are very lucrative opportunities in hard hit areas that promote transition to travel nursing opportunities. This poses a challenge for staffing in community and rural settings.
When we had our numbers drop in March, a lot of hospitals cut their staff. So in March and April, the workforce numbers were down, and they’re still down in some places. They cut their staffs, but like everything does, volumes came back. We’re about 90% to 95% of our volume, but we still haven’t been able to hire back or find the folks to fully staff the ER and hospital again. Then you have those that transitioned to traveling nursing gigs and things like that. So it’s been a real challenge not only with the virus itself, but with the workforce numbers that came during this unexpected drop in volume, and then the rebound.
The Journal of Healthcare Contract-
we’re hearing from places where it may
ing: Can you describe the toll that
not be getting to physicians in emer-
JHC: How are hospitals and health
the pandemic has taken on emer-
gency conditions, emergency staff,
systems trying to help in these areas
gency physicians and their depart-
front line folks. The logistics are
from an organizational standpoint?
ments? How has it affected their
tough, and trying to fight all the false
Dr. Stanton: There are very lucrative op-
mental and physical health?
narratives and conspiracies and every-
portunities in hard hit areas that promote
Dr. Ryan Stanton: I think everybody
thing that is out there is frustrating
transition to travel nursing opportunities.
in medicine, but especially emergency
as well.
This poses a challenge for staffing in
medicine, is just tired now. Everybody is
community and rural settings.
worn out. We can’t see each other’s faces,
JHC: What has COVID’s effect been
and everything’s very isolated. We can’t
on staffing shortages?
6
Hospitals are trying to hire, but you can’t just flip a switch on staff and hire
February 2021 | The Journal of Healthcare Contracting
SOLUTIONS YOU CAN COUNT ON Welch Allyn® Connex® monitors can help you quickly and accurately assess your patients’ health status, with the flexibility to adapt to changing acuity levels— from simple spot-check to continuous monitoring. Make sure your facility is equipped with secure, connected solutions designed to help simplify workflows so you can focus on confidently providing quality care in these challenging times.
Connex Spot Monitor
Connex Vital Signs Monitor
Visit hillrom.com to learn more. Hill-Rom reserves the right to make changes without notice in design, specifications and models. The only warranty Hill-Rom makes is the express written warranty extended on the sale or rental of its products. © 2020 Welch Allyn, Inc. ALL RIGHTS RESERVED. APR158001 Rev 1 16-NOV-2020 ENG-US
EXECUTIVE INTERVIEW
somebody and have them in. You have
A lot of places see the entire health-
they had 34 boarders in the emergency
to onboard. Almost all nurses in the
care setting as one entity, and don’t
department, so they had more people
emergency department, whenever they’re
understand the unique environment of
admitted to the hospital in the ER than
hired, they’re precepted for at least a
the emergency department. Thus under-
there were beds. One of those boarders
couple of weeks, if not longer (especially
standing the flow, speed, turnover, acuity
had been there 15 days.
if they’re a new nurse) to get used to the
and everything else involved with it. The
system, to get used to our emergency
closer that the administration was with
What you established in March is not
department. So it takes quite a while to
emergency medicine and frontline health,
going to work now. Currently one of
get the numbers back up. And during that
the better the process was.
the biggest things with the communica-
Communication has to be evolving.
time, you may lose a few more. Hospitals
For instance, knowing that we can’t
tion is on the vaccine. Who gets it, and
are trying their best, it’s just that there’s a
say we’re not going to wear N95s until
understanding who are the highest risk exposures. At first, our system didn’t put our treatment center on the first round
With supply chain, we’ve been very satisfied with just-in-time delivery and lean processes for the last 20 years. But that doesn’t work when you have a pandemic.
of vaccines. But that’s our second line where we’re sending our COVID patients, they’re the primary care offices in a community, and so they have very high risk of exposure. Understanding your whole landscape is very important. And I think different places have done better, some have done worse, and everything in between. JHC: What are some long-term implications of the pandemic for emergency departments? Dr. Stanton: I think it’s going to change the face and practice of medicine overall,
limited commodity, and everybody’s look-
we have high suspicion that somebody
because I think we’ve figured out some
ing right now.
has COVID. We learned that our first
things that we’ve been doing wrong, but
COVID patient didn’t come in with
we’ve never been in a situation where we
JHC: What’s the communication be-
COVID symptoms, the patient came in
get the risk associated with it.
tween the emergency departments
with a stroke. So everybody was in the
and supply chain been like as far
CT scanner room with no PPE on. That
satisfied with just-in-time delivery and
as trying to get the necessary PPE,
was before we understood the nature of
lean processes for the last 20 years.
medical supplies and adjusting to
COVID. We learned we have to wear PPE
But that doesn’t work when you have a
the new demand?
for COVID in every single room.
pandemic. You can’t have just-in-time de-
With supply chain, we’ve been very
Dr. Stanton: The biggest thing with that
So getting those understandings, and
is whether your C suite – the part of the
understanding when the volumes are going
we’ve learned a lot of stuff about when
hospital that has carpeted offices – is
to come, and when they’re not going to
we are prosperous, we may be putting
connected to emergency medicine.
come. Now in the winter with the amount
ourselves in a position of risk. Over the
Is there physician leadership that under-
of COVID cases, bed space is an issue. I
last 20 years, we’ve been very prosperous
stands emergency medicine, or is it
have a friend that posted last week that he
in terms of having stuff at our finger-
a disconnected?
has a 20-bed emergency department and
tips, being able to order something and
8
livery, because nobody can deliver. I think
February 2021 | The Journal of Healthcare Contracting
have it in house later that day, whatever
to put plans of succession and future
farther and farther away. Everybody is
it may be. And that works until there’s a
growth and pipelines to staffing models.
finally upbeat with seeing the potential
pandemic or a big disaster. That puts a lot
But again, there’s a shifting landscape of
light at the end of the tunnel.
of people, including our healthcare folks,
where are your people? What are their
at risk.
degrees and qualifications? And what’s the
benefits. I’ve not seen a single flu case
demand out there?
so far this year. We aren’t seeing RSV,
From a workforce standpoint, I think we’re going to see significant attrition
The challenge now is that we have a
Also, there have been some side
we’re not seeing norovirus, we’re not
after the pandemic, with physicians,
whole country that’s going to be dealing
seeing the usual things this time of year.
nurses, and techs wanting to get out of
with supply and demand, as opposed to
So there’s been a benefit from those
health care. The message they’re hearing
just regional stuff, which is just easy to
standpoints. Those tend to be high risk
is, “Thank you for serving on the front
fix with people moving from site to site
for our young children, so our children
lines of the pandemic, now we’re going
to get a better job, better facilities, better
are probably safer this winter than
to cut your pay and benefits.” With that
support. But now it’s the whole country.
they’ve ever been.
going on and then what’s happening with Medicare and insurance, I think you’re going to see a fair amount of attrition and turnover, which could make access to care even more difficult moving forward. JHC: Are organizations anticipating the attrition and trying to work toward preventing it? Dr. Stanton: I think some are. While I think you’ll be able to make up with bodies, the question is quality. There is a big difference between having a board certified emergency physician versus a nurse practitioner that just finished their online degree. Though they are both providers, the quality is going to be very different, the experience
The average emergency physician sees about 20,000 patients before they’re considered sufficiently competent in emergency medicine. We typically have 20,000 hours of training before we can be board certified.
is very different. There are mechanisms by which to replace, but the question is, what is the experience and knowledge
JHC: What do the next few months
and what’s being lost from a patient
look like for emergency physicians?
exit strategy to the pandemic. We’re start-
exposure standpoint?
Dr. Stanton: The biggest thing that has
ing to see a change in the mood towards
The average emergency physician
We’re looking forward to 2021 being an
uplifted medicine, especially emergency
more positive now than what we would
sees about 20,000 patients before they’re
physicians and emergency staff, has
have seen a month ago. And I think that’s
considered sufficiently competent in
been the vaccine. The vaccine was the
going to continue as we see the numbers
emergency medicine. We typically have
first time in nine months that we’ve
start to drop off in mid-January, which is
20,000 hours of training before we can be
seen frontline health care workers with
expected after the holidays. They’ll shoot
board certified. When we replace, when
a positive outlook on the pandemic and
up a little bit and then start to tail off, and
we backfill, what’s the loss because of
that there’s going to be an end. Before it
hopefully with the vaccine distribution,
that? I think a lot of facilities are trying
seemed like the goalposts were moving
we’ll see it go away for good.
The Journal of Healthcare Contracting | February 2021
9
SPONSORED
MCKESSON
This flu season … Give your clinicians the freedom to focus on care
For the 2020-2021 flu season 192.3 million doses have been distributed,
2. Standardization of the flu-
the most in a single season, according to the CDC. Comparatively speaking, from
related portfolio in order to
October 2019 through April 2020, 39 million people had the flu, resulting in
leverage better product costs
740,000 flu hospitalizations.
and reimbursement. 3. A point-of-care flu and respiratory testing program at all non-
The clinicians in your health system’s non-acute facilities play an im-
full flu strategy will be more important than ever before.
acute treatment sites. 4. An automated supply chain,
portant role in vaccinating, testing and
which can relieve clinicians
treating patients for flu, from pediatrics
Health system’s supply chain plays an
(and supply chain) from
to geriatrics. To do so, they need access
important role in providing clinicians with
the traditional burdens
to a full portfolio of medications, flu
the freedom to focus on care and not on
of procurement.
and respiratory diagnostics, antivirals
supply chain activities. Here are four ways
and ancillary medical products. It’s
supply chain can provide them with a ho-
even more important to plan for a
listic flu program, encompassing preven-
Step 1: Anticipate demand
challenging flu and respiratory season.
tion, diagnostics and treatment:
Having a flu preparedness plan in place
Vaccinating against flu will be critical
1. Demand planning for pre-season
is good business and essential for a
in mitigating potential patient surges at
and in-season vaccinations
seamless transition into flu season. It
health systems this winter. Designing a
and treatment.
begins by anticipating the demand for
10
February 2021 | The Journal of Healthcare Contracting
vaccines, flu tests, antivirals and neces-
processes and lower costs. The same prin-
systemwide, holistic care for flu and
sary med/surg supplies to vaccinate.
ciple holds true for flu programs.
respiratory illness, the health system
By examining last season’s purchases
By selecting one distributor, the
can capture and record vaccination and
and consumption data, supply chain can
health system gains access to the depth
treatment activities in the electronic
spot trends to help anticipate demand.
and breadth of flu products, including
healthcare record. That’s helpful if
Your supplier can assist in gathering that
vaccines, ancillary medical supplies, diag-
the patient is hospitalized or seen by
information and adjusting it, if necessary,
nostic testing, and products for treating
someone other than their family physi-
to accommodate anticipated market – and
flu. (The last category includes Tamiflu®,
cian. What’s more, if vaccines or tests
epidemiological – developments.
which is used to treat flu in people two
are recalled, the health system can track
weeks of age and older who have had flu
down potentially impacted patients us-
symptoms for no more than two days.)
ing patient records.
Health systems should consider its patient mix to determine which vaccines to order. Having access to a full vaccine
The health system benefits from the
Point-of-care flu and RSV tests can
portfolio with vaccines for patients of
distributor’s volume contracts with manu-
be administered in the doctor’s office
every age, including FluMist® Quadriva-
facturers, and web-based reporting helps
and delivered to the patient in minutes.
lent, a nasal spray flu vaccine for eligible
supply chain understand who is ordering
This same-day process speeds up treat-
children and adults ages 2-49. Note: the
vaccines, what type of vaccines and ancil-
ment plans and can help support pa-
industry has moved from trivalent vac-
lary products they are ordering, and from
tient satisfaction. After all, when you’re
cines, (containing three strains – two A”
whom they are ordering them. This may
sick, the last thing you want to do is go
and one “B”) to quadrivalent vaccines
be your best shot at identifying “rogue
to multiple offices for testing. Health
(containing four strains – two “A” and
purchasing,” which can adversely affect
systems should consider standardiza-
two “B”).
the health system’s ability to standardize
tion and adoption of multiple methods
for best costs.
for testing.
Supply chain should also consider working with its lab supply chain counterparts to ensure there will be enough flu test kits, including rapid molecular testing. Rapid molecular assays can detect the influenza virus in approximately 15 – 30 minutes2 and supports latest infectious disease society flu (IDSA) guidelines (www.idsociety.org/practice-guideline/ influenza). Due to expected allocations
and supply restraints on COVID-19 tests
By selecting one distributor, the health system gains access to the depth and breadth of flu products, including vaccines, ancillary medical supplies, diagnostic testing, and products for treating flu.
for molecular tests, many health systems should understand the testing options for flu and COVID-19, then work with a dis-
Step 3: A systemwide program
tribution partner to help each care setting
Chances are, your health system is
Step 4: Automate your supply chain
get set up to address respiratory illnesses
facing increased competition for
Automation of back-end processes leads
with a full suite of testing for flu, strep,
flu vaccinations from supermarkets
to better business efficiencies. Managing
RSV and COVID-19.
and retail clinics. That’s why many
pre-season and in-season flu ordering can
are building point-of-care flu and
be an automated process. Rather than
respiratory testing programs for all
shuffling through myriads of reports
their non-acute treatment sites.
from multiple distributors and manufac-
Step 2: Standardize Supply chain executives know that standardization leads to more efficient
Competitive reasons aside, such programs benefit patients. By providing
The Journal of Healthcare Contracting | February 2021
turers, supply chain has quick and easy access to systemwide data and analytics
11
SPONSORED
MCKESSON
to help with demand planning. Using cutting-edge technology can help capture and analyze data across the health system. In non-acute care settings, which are
2021-2022 flu season update
often located across a region, having connectivity like EDI and on-line ordering can help enable business efficiencies.
FluWise® McKesson has offered the FluWise® program to customers for several years, but recently adapted it for today’s health systems. The program offers expanded warehouse hours, so all sites receive their vaccine and other flu-related products quickly. Ninety-five percent of orders come with same- or next-day delivery. FluWise® also offers guidance on opportunities to standardize products, complimentary training on topics such as vaccine storage and influenza coding, and expertise to help the health system manage patients’ needs throughout the flu season. By participating in the FluWise® program, supply chain gains access to a committed customer service team, who will answer product-related questions, expedite orders, and provide alternatives in case of backorders. They can help supply chain pre-book flu vaccines to make sure the health system gets high-quality products in the quantities needed, and avoid manufacturer waitlists. Given the potential complexities COVID-19 may bring to the upcoming flu season, consider helping your clinicians serve their patients with McKesson FluWise®. For more information, visit
Supply chain executives can expect a higher demand for influenza vaccine from their clinicians than they have in prior flu seasons, says Omar Bateh, director of vaccines, McKesson Medical-Surgical. Very early manufacturing estimates for the 2021-22 flu season are 184-188 million doses, compared to approximately 168 million doses in the 2019-2020 season, he says. “Across various class-of-trades, we are seeing a 10 to 20% increase in demand.” There are expectations of high demand for the 2021-2022 flu season. The McKesson Medical-Surgical vaccine team is working closely with every manufacturer on pre-booking demand to help increase supply in the marketplace for the upcoming season, he adds. In addition to a greater demand for flu vaccine, healthcare providers can expect a few other changes related to the COVID-19 lockdown last season. “Providers should be thinking about alternative avenues to administer flu vaccines, potentially vaccinating in the parking lot, setting up drive-through clinics, or potentially partnering with a home health agency to vaccinate patients in their homes,” says Bateh. In addition, as clinicians administer flu shots in the fall, they should make sure to catch their patients up on any shots they might have missed during the lockdown. “Even if the patient is up-to-date, they should be offered a pneumonia shot such as Pneumovax® 23 or Prevnar 13®, and a shingles vaccine like Shingrix.” Depending on the severity of the upcoming season, supply chain might encounter a heightened demand for antiviral medications, such as the branded drug Tamiflu®, the generic oseltamivir phosphate, as well as Xofluxa™, first marketed in October 2018.
https://mms.mckesson.com/content/clinicalresources/flu-management.
1 2
https://www.cdc.gov/flu/about/burden/preliminary-in-season-estimates.htm https://www.cdc.gov/flu/professionals/diagnosis/molecular-assays.htm
12
February 2021 | The Journal of Healthcare Contracting
Pharmaceutical solutions to help you cure inefficiency Doctor’s offices, urgent care sites, community health centers, multi-specialty care — each one has unique needs when it comes to pharmaceuticals. That’s why it’s so important to have an expert that understands the world of non-acute, and can help you simplify operations, improve efficiency and open up more time for your patients.
Our non-acute expertise brings you: • A large selection of generic and branded pharmaceuticals, including vaccines, specialty drugs, generics, OTC and biosimilars • Online ordering, automated processes and more to buy back time for your staff • Cost-saving tools like business analytics, reimbursement strategies and more • The latest therapies and clinical education from manufacturers • A team of experts who can help you lead change
Take the next step in building a stronger pharmaceutical supply chain.
McKesson.com/TakeControl Medical-Surgical. Pharmaceutical. Lab. Equipment.
© 2020 McKesson Medical-Surgical Inc. All rights reserved. Actual savings may vary based upon products selected and other factors.
Amanda Chawla, Chief Supply Chain Officer, VP at Stanford Health Care, Stanford Children’s Health & Stanford-Valley Care
14
February 2021 | The Journal of Healthcare Contracting
BY GRAHAM GARRISON
Building a Resilient Supply Chain This year’s Contracting Professional of the Year helped to develop and implement unique solutions to supply chain challenges brought on by the pandemic.
In 2020, collaboration was top of mind for Amanda Chawla, chief supply
Stanford Children’s Health and Stanford
chain officer/ vice president, Stanford Health Care, Stanford Children’s Health and
Health Care – ValleyCare. “Supply Chain
Stanford Health Care – ValleyCare. For instance, at the time of Federation of American
is a strategic, operational, and executive
Hospitals Conference last February, as Chawla watched the coronavirus developments
function that impacts every single non-
overseas, she tried to plan for what was coming, not only for Stanford Medicine, but for
labor resource and every function in any
the local community and industry in general. “I probably didn’t imagine the pandemic to
organization. Healthcare Supply Chain
the degree that it is today,” she said. “I was thinking about what was happening abroad
requires a patient-centric approach and a
at the time of Federation, the potential impact, and what were ways I could collaborate
dyadic clinical partnership that incorpo-
with my colleagues should COVID become prevalent in the United States? How could
rates value (value = cost, quality, effi-
we work together to secure the Supply Chain?”
ciency & outcomes) in every aspect of the business. Supply Chain is about executing board functions from planning, procure-
Chawla, this year’s Contracting Professional of the Year, answered those initial questions with ideas that helped Stanford Medicine navigate the COVID-19 pan-
> Stanford University School of Medicine > Stanford Health Care > Stanford Health Care – ValleyCare > Stanford Children’s Health
demic, and benefited neighboring health systems as well.
ment to operations of logistics by keeping the patient at the heart of the equation – we provide the right item at the right time to healing hands that provide care to our patients. Supply Chain is really the sup-
All told, Stanford Medicine’s clinical facilities includes approximately 146
portive arm and sits across the entities.” There are three tenants that bring
operating/procedure rooms and over
those entities together, Chawla said.
Stanford Medicine tenets
1,200 beds. Stanford Medicine has about
“One is our drive to be digitally driven,”
Stanford Medicine is an academic medi-
3 million outpatient encounters a year
she said. “The second is to be value
cal center (AMC) focused on education,
with a non-labor spend of $1.5 billion.
focused, and value as defined by qual-
research and clinical care. The primary organizations are comprised of:
Supply chain is a shared corporate service across Stanford Health Care,
The Journal of Healthcare Contracting | February 2021
ity, safety cost, experience, whether it involves patients or stakeholders. The
15
CONTRACTING PROFESSIONAL OF THE YEAR
third is to be uniquely Stanford, which is
media for testing in house,” Chawla said.
healthcare providers. “When you’re in an
the cutting-edge medicine component of
Stanford Medicine has been making its own
urgent situation where traditional sourc-
changing the way we do things through
media for COVID-19 testing ever since.
ing channels are limited, the idea is to be
innovations, education, and research.
Another product shortage involved
able to reach out to your colleagues across
Having the privilege to lead in an AMC,
testing swabs. Supply was limited and,
our industry and trade product. We know
I have the opportunity to collaborate
across the industry, supply chain depart-
that not all purchasing is equal,” she said.
with professionals across the health
ments were up against the same barriers.
“We have to come together as a healthcare
system and university and access to re-
Stanford Medicine partnered with several
provider industry supporting not only our
sources that assist with the advancement
companies in the Bay Area, such as 3D
systems and our community but support
of our profession.”
printing organizations and engineers,
one another as healthcare supply providers. While this solution is intended for
“ We were able to solve some supply chain problems not only through direct international strategic sourcing, but leveraging collaborations and through the activations of an Innovations Task Force.”
– Amanda Chawla
emergent needs, we still need to evolve and develop data sharing and intelligence that leads to a resilient Supply Chain. We are data-rich but intelligence poor – we must solve and address the gaps that will allow for visibility in the ‘Supply Chain’ linking raw materials to utilization to demand forecasting. We must address the simple day-to-day operations such as removing the ‘hunting and gathering’ of par management in logistics. Building an intelligent supply chain that allows us to have a push system, automated information, leading to
Innovations and Innovation Task Force
to try to solve its own supply chain
reliability, performance, transparency, and
problems. Through these partnerships,
value, is a must. Can we create a cultural
Internally, Stanford Medicine leveraged
Stanford Medicine was able to produce
change in our industry that forces transpar-
resources, knowledge and the skillsets of
3D-printed swabs. Another example of
ency and collaboration? When we face
its professionals to help propel the health
innovation was with PPE and disposables
the next global pandemic together, we’ve
system’s COVID-19 response and solve
being short on the market, Stanford uti-
got to be able to collaborate, have solu-
problems that couldn’t have been solved
lized 3D printing to solve the market limita-
tions in place that protect not only our
through strategic procurement. The
tions with standard face-shields, equipment
institutions and communities, but each
organization created an Innovation Task
parts, and CAPR/PAPR shields.
other across the industry.”
Force. Because the global supply chain
“We were able to solve some supply
The exchange would prove to be of
was being stretched to the limit, Stanford
chain problems not only through direct
immediate value for Stanford Medicine
Medicine leaders asked themselves, ‘What
international strategic sourcing, but
and other hospitals as supply shortages
solutions could the organization come up
leveraging collaborations and through
varied. Stanford Medicine did a number
with internally?’
the activations of an Innovations Task
of exchanges where it had surplus of cer-
Force,” Chawla said.
tain PPE size or item with another system
As it turned out, plenty. For example, Stanford Medicine was short on me-
In early March, as the pandemic
who may have had another PPE size or
dia for the labs needed for COVID-19
worsened and shortages of critical sup-
item. Stanford Medicine traded products
testing. “Our lab and procurement team
plies surfaced, Chawla approached the
such as N95s, cleaning and disinfectant
partnered with the School to pull raw ma-
CEO of an AI technology organization
wipes and masks with other systems
terials used in research to make our own
about creating a supply exchange for local
through the pandemic.
16
February 2021 | The Journal of Healthcare Contracting
Supply chain challenges? Supply chain challenges? Supply chain challenges?
Call AliMed. Call AliMed. Call AliMed.
In-stock products ship same day In-stock products ship With a 98% in-stock rate, same-day shipping, and same over 120 day U.S.-based In-stock products ship same day sales and customer care representatives standing by, and AliMed is120 ready to takesales your call. Witha a98% 98% in-stock rate,same-day same-day shipping, over U.S.-based and With in-stock rate, shipping, and over 120 U.S.-based sales and With a 98% in-stock rate, same-day shipping, and over 120 U.S.-based sales and customer care representatives standing by, AliMed is ready to take your call. customer care care representatives representatives standing standing by, customer by, AliMed AliMed ready to to take take your your call. call. 800.225.2610 x330isis ready
800.225.2610 x330
800.225.2610 x330 800.225.2610 x330 Your supply chain... solved. Your supply supply chain... chain... solved. Your Your supply chain... solved. solved. AliMed.com/supply-chain AliMed.com/supply-chain
CONTRACTING PROFESSIONAL OF THE YEAR
Stanford Medicine
Keeping people at the center When the pandemic hit, Stanford Medicine had to move towards a distributed workforce model almost overnight. Its category management, master data management, and purchasing teams all went off site. They’ve been working from home ever since, amid conditions that require tight coordination, communication, connection and collaboration. The infrastructure component was critical. Stanford hospital leaders discussed how they could have their command center set up within supply chain so coordination could be maintained from leadership to frontline staff. To do this, they invested heavily in how
18
Taking a moment to step back and reflect on the past year, Chawla said it is important that we recognize the Supply Chain responded and performed in the way that it was designed to, with lean principles.
communications occurred in addition to the structure itself. “We’ve always had monthly newsletters,” Chawla said. “We revamped those for use in our daily huddle structure and enhanced communications and connects through a myriad of different tools from daily cascading of huddles to podcasts to bi-monthly newsletters and increasing frequency of all hands leadership meetings.” The podcasts have been a hit as they shine light on the front-line team members and present an opportunity for leaders to provide a personal touch to the messaging and organizational communications broken down in a meaningful way.
February 2021 | The Journal of Healthcare Contracting
CONTRACTING PROFESSIONAL OF THE YEAR
2020 has been an unprecedent year of disruption, angst and of change.
day, we’re all people, and we’re all in a
would propose the conversation will shift
human business.”
in a more accelerated manner towards
Stanford Medicine navigated through the
total value and reliability.”
first supply disruption of the Cardinal
Stanford Medicine made two major
packs and gowns to the pandemic to
Resiliency
decisions in the midst of the pandemic
social justice to California fires to the
Taking a moment to step back and reflect
to focus on risk, resiliency, transparency
election unrest. With the amount of
on the past year, Chawla said it is impor-
and diversification. The resiliency part
disruption the nation has faced it has
tant that we recognize the Supply Chain
of the conversation was probably one
brought forward economic hardships,
responded and performed in the way
of the most important elements that
loss of homes, illness, job loss, unreliable
that it was designed to, with lean prin-
is being embedded within contracts
childcare and much more.
ciples. Pre-COVID-19, the key tenants
with transparency and data as part of
of supplier/provider relationships were
contractual language.
“It’s not just one thing,” Chawla said. “Recognizing the impact of the disrup-
efficiency and cost.
“Outside of contracting, it is impor-
The silver lining that the pandemic
tant that in part of that evolving rela-
health, the team and support. As a lead-
has brought forward is an opportunity to
tionship with suppliers there are more
ership team we have ensured that we’re
change or double down on a perspective
in-depth conversations to build trust and
keeping people at the center of what
and approach. “I do not see cost or price
understanding principles. The conversa-
we do. Part of that for me, is empathy,
of products and services being removed
tions may go something like, ‘I can’t do
respect, recognition and the communica-
from the conversation – that is still go-
X for you; however, an area where we
tion, collaboration, and transparency –
ing to be part of the compensation for
may be able to collaborate or provide
reaching out. Because at the end of the
economic viability,” Chawla said. “But I
support towards the problem or solution is
tions, we have focused on well-being,
Doing the right thing Chawla was born in India, but grew up in the suburbs of Seattle, Washington. Her family relocated to the United States primarily because of an aunt, who was a nurse. Chawla’s aunt passed away due to a medical error. While Chawla was very young when it happened, her aunt’s death was a pivotal event. “It had an impact on my family and in my personal life. As a result, I think about processes, structure, assuming good intent and as a leader my responsibility to provide support and care to people at the heart and center of leadership,” she said. “How do we create processes and infrastructures that eliminate the potential human errors in our processes? People intend to do the right thing and are good in their desire, but we are human, we do make mistakes. So how do we create an infrastructure that’s around processes and systems and leverage that in the work?”
20
Chawla got an early start to a career in healthcare as a medical assistant. While in high school and through college, she worked at a psychiatric hospital performing a myriad of functions from intake, admission, to providing direct patient care across pediatrics to adults. She also worked for a private practice, a group of physicians who wanted to start clinical trials. Chawla would end up opening their clinical trial site operations, establishing the operating procedures to marketing and recruitment. “Some of the things that the physician owners and leaders taught me was really how we lead and connect with people, whether it was on the frontline taking care of a patient, or whether it was running the office to speaking engagements. I learned early on that it was really about people. You can learn the technical aspects of the job, but you have to have the behavioral components and the leadership attributes to bring and lead people.”
February 2021 | The Journal of Healthcare Contracting
on Z.’ It’s that trust and that knowledge of whether the supplier is a company you can rely on. Do they have safety stock? How do I ensure that my organization is going to be protected and that we are not going to impact patient care? How do we know what the supply is in terms of availability and demand? Importantly, how do we come together?” Moving forward, there will be a greater demand for further insight into quality and control on inventory. Providers will want the right and intelligent information and visibility upstream Supply Chain, all the way to raw materials that leads to reliability and resiliency. Indeed, conversations on visibility are happening all around the industry, Chawla said. There are questions to work through, such as what platform to use, data systems integrity and standards around the data. “There’s a lot that goes into it. And right now, as I see what we’re doing at Stanford, and what my colleagues are doing, a lot of it is the focus on resiliency. We’ve invested very heavily in a resiliency program and model.” Data integrity and transparency are integral. Not just understanding what’s in the pipeline, but what the raw materials are, where they come in during the manufacturing process, how the product is transported, and what is the location of the distribution centers where the inventory is stored before it actually reaches hospitals and health systems. Understanding the current inventory on hand at any given moment to the consumption’s trends and demand fluctuations. “I believe more organizations will take pause and re-assess their just-in-time inventory model differently,” Chawla said. “Because if you think about it, most hospitals designed their Supply Chain to be a
“Outside of contracting, it is important that in part of that evolving relationship with suppliers there are more in-depth conversations to build trust and understanding principles.”
The Journal of Healthcare Contracting | February 2021
lean Supply Chain, to be Just-in-Time and to only keep a certain amount of inventory on hand. When the pandemic hit, our Supply Chain responded in the way that it was designed. It was not designed around resiliency. It was not designed around pandemics.” Stanford Medicine did a risk stratification analysis of all the different types of disruptions that can occur from daily manufacturer back orders to a recall to situations that are specific to the Northern California region, like earthquakes or wildfires. The Supply Chain team then broke the stratification out into four quadrants, and discussed what was most
21
CONTRACTING PROFESSIONAL OF THE YEAR
likely to occur, the potential impact, and the hospital’s preparedness and response capabilities. Based on that grid, the Supply Chain team came up with a number of different factors to examine and resolve as they built their resiliency program. This included data access, data management, analytics, processes across the intra-Supply Chain, and standard work. Another element was the investment of a resiliency program that supports business continuity and manages towards a resilient Supply Chain including risk mitigation scenarios and planning. Facilities also factored in. “We have invested capital into a resiliency warehouse in which we’re keeping certain amounts of supplies and operationalizing a hybrid model between just-in-time with our distributor, direct order management, and the resiliency warehouse.” Supplier diversification was an important consideration. “Another important element our item management and
Chawla said COVID-19 has accelerated the need to further invest in the Supply Chain on things that we should be doing and have needed to do.
assessment is using the 80/20 rule. How do we accelerate clinical equivalence substitutes, so when we have a product disruption with product X, we know what’s Chain has been important. Stanford
recognition of what’s gone on in 2020,
Medicine’s Supply Chain is clinically
and how that changed our lives,” she
integrated and supported. “So we’re
said. “I think we’ve been in the stage of
The road ahead
fortunate in that sense,” Chawla said.
adapting to the new normal, but now
Chawla said COVID-19 has acceler-
“But it’s brought that to a heightened
it’s about living in that new normal. And
ated the need to further invest in the
awareness. We have forged stronger
it’s about transforming our leadership,
Supply Chain on things that we should
relationships with our clinical providers,
business practices for enhancement and
be doing and have needed to do. “It has
leadership across the organizations and
optimization for in the next normal of
brought the awareness to our organiza-
systems, improved some of our busi-
our future.”
tion as a lifeline – without the medical
ness processes that has provided greater
supplies to our care providers we are
visibility in our inventory, and are im-
system as a whole must utilize 2020 as a
handcuffed on the core mission of pro-
proving relationships with our strategic
catalyst to lead and change. “Is COVID
viding patient care and that is the case
suppliers and collaborators.”
going away? Probably not. But how we
clinically acceptable as an alternative?”
for all healthcare institutions.” Obtaining funding, support, clinical partnership, and investment for Supply
22
Chawla said that the next six to
Supply Chain and the U.S. healthcare
respond, engage and operate can be dif-
12 months will be about adjusting to
ferent. We should utilize 2020 as a silver
the next normal. “It’s going to involve
lining to design the next future.”
February 2021 | The Journal of Healthcare Contracting
Coloplast
OneSolution
â„¢
GROUP PURCHASING ORGANIZATIONS
BY MARK THILL
How Would You Grow Your GPO?
If you were the leader of a group purchasing organization, how would you
Two supply chain experts recently
grow it? Would you expand your contract portfolio? Merge with another group? Pursue
shared their thoughts on GPO growth
new markets? Introduce new services?
with The Journal of Healthcare Contracting.
There are all kinds of growth strategies. For instance, Vizient’s acquisition of In-
The first, Eugene Schneller, professor
talere from Intermountain Healthcare in November gave the GPO a bigger presence in
of supply chain management at the W.P.
the non-hospital market, among other things. And by acquiring Resource Optimization
Carey School of Business at Arizona State
& Innovation LLC (ROi) in October 2019, HealthTrust gained experience in logistics
University, believes growth comes from
and manufacturing (i.e., custom procedure trays).
offering products and services that help
24
February 2021 | The Journal of Healthcare Contracting
more, because of what he observed during COVID-19, he would work to ensure the integrity of his supply chain, so that necessary products would be on hand when they were most needed.
Growth strategies “Just expanding the number of products on contract isn’t what you want to do,” says Schneller. “Instead, develop a product line that helps your customers build value.” Sometimes an acquisition that provides a unique competency can help a GPO do just that. He points to HealthTrust’s acquisition of ROi. “ROi has consistently been a leader in supply chain management in the U.S. – not just about price, but about value,” he says. The deal combined excellence in strategic thinking with supply chain management, and integrated ideas from other industries. Furthermore, as part of Mercy, ROi had already begun to think in terms of managing around episodes of care, he says. GPOs should take heed and help their members look at supplies in the context of bundled payments. “Many health systems are looking for that kind of thinking.” Finally, as head of a GPO, Schneller would work with supply chain partners to smooth out wasteful processes, including the current ineffective method of conducting product recalls. Some manucustomers build value. If Schneller were
Braintree, Massachusetts, were leading a
facturers have already taken the lead, he
leading a GPO, he would develop stronger
GPO (as he did Consorta and Premier),
says. Philips, for example, uses advanced
alliances with suppliers, so together they
he wouldn’t shy away from consolida-
analytics to examine service records
could create innovative products and
tion opportunities, but he would keep a
and detect potential problems before
services driven by customer demand – not
watchful eye on his organization’s cost
they multiply, he points out. “It’s taking
their own sales and marketing exigencies.
to serve. That way, he could drive up
capabilities like these and translating them
If John Strong, chief consult-
members’ dividends – an important draw
into value-added propositions for health
ing officer, Access Strategy Partners,
for hospitals and health systems. What’s
systems that will make the difference.”
The Journal of Healthcare Contracting | February 2021
25
GROUP PURCHASING ORGANIZATIONS
John Strong believes that trying to
members – IDNs and health systems.
contract with them. For the GPO, this
sign up more members shouldn’t be the
After all, they are not only a GPO’s
usually means smaller contract admin-
go-to strategy for GPOs seeking to grow.
biggest revenue-generator, but also its
istrative fees. These fees are what fuels
“Ten years ago, there was arguably more
biggest potential competitors.
the GPO’s ability to pay dividends to
competition and ‘shopping’ for GPOs
“As health systems become larger,
the market, [which in turn] puts pressure
than there is today. Gaining the last few
they become more able to aggregate
on costs, and pressure on the GPO to
non-affiliated acute care customers, or
their own volume,” says Strong. “If I
increase dividends to their members.”
gaining share from other GPOs, was
were running a large healthcare supply
the focus. Today, that business is largely
chain today, I would be more interested
locked up. Now the focus is on smaller,
in purchasing fast-velocity items directly
Growing in a pandemic
but increasingly important customers
from manufacturers and take the cost that
For GPOs, COVID-19 has presented
outside the acute care hospital.”
manufacturers are paying to the GPO in
opportunities for growth, as well as obstacles. Says Strong, “Because of the
GPOs should take heed and help their members look at supplies in the context of bundled payments.
pandemic, I think all customers are seeking good service, little distraction, and quality supplies when and where they need them. This all distills down to great, responsive customer service to solve real problems quickly. While some GPOs may have stubbed their toe a bit on access to PPE, their members still look to them for cash dividends; the use of many more commoditized product contracts; data and analytics; and outsourcing the cost of their supply chain.”
Case in point: Vizient’s acquisition
the form of additional discounts. Each
At the same time, the pandemic has
of Intalere, with more than 100,000
area of ‘friction’ in the healthcare supply
worked to separate providers from their
non-acute sites of care on its ledger,
chain costs money. There are probably
GPOs and distributors just a bit, says
makes Vizient a big player in this arena,
ways to take this cost out of the supply
Schneller. “In the pandemic, when the
says Strong. “This should allow them to
chain through more direct purchases and
supply chain system failed, many large
deploy more capital to achieve goals in
reducing or eliminating the cost borne by
systems gained new competency for find-
this market, such as reducing the cost
manufacturers using GPO contracts.
ing suppliers, and they found that in some
to serve, positioning some of their sup-
“GPOs provide valuable services, and
ways, they had to, and could, reduce their
pliers so they can either move into or
they need to be paid. But these need to
expand their presence in this market, and
be rationalized during the course of this
have the size necessary to thrive even if
decade, along with those of all the other
cast themselves as risk management orga-
this area of the healthcare market begins
players along the supply chain.”
nizations, they will have problems. I don’t
consolidation on its own.”
Supplier consolidation presents its
dependence on intermediaries. “In the long run, if GPOs fail to re-
think the ‘new normal’ will tolerate a
own set of challenges to GPOs, says
focus solely on price or merely expanding
Strong. “Larger and larger suppliers
services that can be acquired from more
Competitive threats
gain leverage. In some cases, they carry
established consulting or service-enhance-
One of the greatest challenges facing
products that members insist on having,
ment companies. GPOs must strategically
GPOs is figuring out how to navigate
and dominate the market for a product
choose enhancements that will support
their relationship with their largest
category, all but forcing GPOs to sign a
customer/member resilience.”
26
February 2021 | The Journal of Healthcare Contracting
December 2020 • Vol.16 • No.6
Women Leaders in Supply Chain Annual celebration of women leadership from many backgrounds, with many different experiences and mentors.
Kim Moon, director supply chain, Tucson Medical Center
The only publication dedicated solely to the healthcare supply chain.
REACHING 4,400 IDN EXECUTIVES, 2,500 HOSPITAL EXECUTIVES, 600 GPO DECISION MAKERS AND 3,500 SUPPLIERS/MANUFACTURERS
CALL US FOR MORE INFORMATION: KATIE EDUCATE 770-263-5271 e-mail: keducate@sharemovingmedia.com
We are proud to partner with The Journal of Healthcare Contracting. The unique educational content and market knowledge JHC provides serves as a vital resource to the supply chain and GPO communities. The benefit we receive has far exceeded our investment. — Bob Davis, AVP, Marketing & Communications, HealthTrust
JHC PUBLISHES YEAR-ROUND • 6 PRINT EDITIONS • 6 DIGITAL EDITIONS VISIT US ONLINE AT JHCONLINE.COM TO READ MORE EDITIONS OR FOR MORE INFORMATION
CONSOLIDATED SERVICE CENTER
BY ALAN CHERRY, DAIL-E NEWS EDITOR
Beyond Four Walls Today’s consolidated service centers require well-thought-out strategies in order to effectively meet the goals of their overarching organizations.
When starting a CSC, the healthcare system must determine the strategic objectives for their specific needs. It’s critical to develop a business case that outlines the cost, objectives, expected outcomes and general timeframes, as well as numerous other service support elements of the anticipated model. However, to do so requires real transparency within the organization as well as with its supplier partners.
Running a consolidated service center (CSC) is not just about setting up four
4 CSCs function best when the relationship between suppliers and
walls and doing self-distribution. Approaching it as such is setting yourself up for
providers is collaborative instead of
failure, said supply chain leaders during a recent ANAE panel discussion. In a panel
transactional. When starting a CSC, it’s
moderated by Supply Chain Sherpa’s Jeromie Atkinson, supply chain leaders discussed
important to bring all parties to the table
consolidated service centers – how they got started, where they are now, and where the
and have a frank discussion about how to
trend is moving forward. Participating were:
get away from a contentious relationship to a much more invested program, where
John Lebowitz, recently retired VP of supply chain ops for Stryker
everybody has “skin in the game” and
Greg Swanson, CEO and co-founder of National Medical Logistics.
there is visibility all the way through.
The following were five takeaways from
points of care now are finding them-
the panel discussion.
selves flowing through a CSC.
5 There are going to be growing pains, but once those bugs get worked out, the returns can be seen throughout the entire organization. When a provider
1 The CSC model and its purpose have changed over the past couple
2 Running a CSC is not just about setting up four walls and doing self-distribution.
embarks on a CSC, what they’re really
of decades. When CSCs first emerged,
Approaching it as such is setting yourself up
want to outsource our supply chain to
they were very hospital-centric but, just
for failure. Creating and maintaining a CSC
certain areas, and we want to take more
like health systems, they’ve since become
must be incorporated into the healthcare
accountability for them.” That account-
much more diversified. Supply chains at
system’s overall strategy; it’s not simply
ability flows throughout the supply chain,
healthcare systems today have to account
about having a better warehouse widget.
and the net result is an increased collabo-
for not just hospitals but physician offices, surgery centers, even extended care facilities and more. And all those
28
saying is, “We’ve decided we no longer
ration and an enhanced level of inventory 3 There is no “one size fits all” model for consolidated service centers.
availability that the clinician can see, right down to the point of care at bedside.
February 2021 | The Journal of Healthcare Contracting
SPONSORED
B. BRAUN
B. Braun and Kerma Medical Products Launch a Collaboration Focused on improving healthcare services, developing sustainability solutions, and overcoming barriers to care in underserved populations
B. Braun Medical Inc. (B. Braun) and
an emphasis on veteran, minority and
sourcing, sustainable manufacturing, and
Kerma Medical Products, Inc. (Kerma)
other underserved communities. The
diversity programs.
announced a collaboration to improve
companies will work together on a range
“Kerma has established itself as one
the development and delivery of
of areas including product development,
of the premier minority, veteran-owned
healthcare products and services, with
co-marketing opportunities, strategic
companies in the healthcare industry,�
The Journal of Healthcare Contracting | February 2021
29
SPONSORED
B. BRAUN
said Joe Grispo, Chief Sales Officer and Senior Vice President, B. Braun Medical. “Our collaboration gives us the opportunity to forge new relationships with a set of customers in the commer-
“ In B. Braun, we saw a family-owned company whose mission and values are closely aligned with the principles upon which Kerma was founded,”
cial market that have unique healthcare
– William “Joe” Reubel, President and CEO, Kerma
needs. With Kerma, we will improve our ability to understand those customers and know how to serve them better,
systems and patient populations across
while enhancing our diversity engage-
the country. We are also excited to lever-
ment goals and initiatives.”
age B. Braun’s longstanding leadership in
The two companies have different
environmental responsibility and sustain-
product lines, but a common set of
able manufacturing – areas that are a
values that have driven their long-
growing concern to healthcare consum-
standing relationship, which is now so-
ers,” Reubel concluded.
lidified in the collaboration agreement.
One of the immediate areas of
“In B. Braun, we saw a family-owned
focus for the partnership is to enhance
company whose mission and values
diversity programs and engagement with
are closely aligned with the principles
healthcare organizations that support
upon which Kerma was founded,” said
underserved populations. Kerma and
William “Joe” Reubel, President and
B. Braun will work together to identify
CEO, Kerma.
areas of need and establish targeted col-
“To us, this partnership means finding new ways to develop and deliver improved care programs and solutions to health
laboration programs with healthcare proWilliam “Joe” Reubel, President and CEO, Kerma
viders to help improve health services and outcomes.
Kerma Medical Products, Inc. is a Veteran-Minority Owned Company (VOSB) located in Suffolk, Virginia with a direct sales division in Miramar, Florida that manages the delivery of Small Cap Equipment and Supplies. Kerma began as a manufacturer in 1991 as a United States Government supplier and in 1994, Kerma expanded into the Commercial Medical Products industry (e.g. hospitals). Kerma has established itself in the healthcare industry as a company that manufactures, assembles, and packages medical products and is now one of the largest diversity manufacturer/supplier companies in the private sector. We provide medical products to approximately 3000 of the 5000 Acute Care Hospitals in the country as well as government agencies distributed by Prime Vendors.
B. Braun Medical Inc., a leader in infusion therapy and pain management, develops, manufactures, and markets innovative medical products and services to the healthcare industry. Other key product areas include nutrition, pharmacy admixture and dialysis. The company is committed to eliminating preventable treatment errors and enhancing patient, clinician and environmental safety. B. Braun Medical is headquartered in Bethlehem, PA and is part of the B. Braun Group of Companies in the U.S., which includes B. Braun Interventional Systems, Aesculap® and CAPS®. Globally, the B. Braun Group of Companies employs more than 64,000 employees in 64 countries. Guided by its Sharing Expertise® philosophy, B. Braun continuously exchanges knowledge with customers, partners and clinicians to address the critical issues of improving care and lowering costs. To learn more about B. Braun Medical, visit bbraunusa.com.
30
February 2021 | The Journal of Healthcare Contracting
B. BRAUN SPACE® INFUSION SYSTEM LOWEST RECALL RATE,1 14 YEARS AND COUNTING.
A HIGH QUALITY PUMP IS OUT THERE. The Space® Infusion System has been a high-quality pump platform on the market for 14 straight years—with the fewest FDA recalls,1 fewest MAUDE complaints,1 and zero critical ECRI alerts.1 Offering a full portfolio of pumps for acute and outpatient care, it’s used nationwide from the NICU to the U.S. Armed Forces. Experience a higher quality pump with B. Braun’s Space® Infusion System. Learn more at firstinquality.com/space. Rx only. © 2020 B. Braun Medical Inc., Bethlehem, PA. All rights reserved. 12/20 1 B. Braun Data on File, 2020
INFECTION PREVENTION
UV-C Disinfection in the Limelight Next to front-line workers and Anthony Fauci, mobile ultraviolet ‘robots’ could be the pandemic’s biggest rock stars.
Editor’s Note: The participation of those in the following article does not constitute an endorsement of the sponsor’s products or services.
Microbiologists know that ultraviolet radiation can disinfect air, water, and
Do they work?
nonporous surfaces. For decades, UV-C radiation – the highest energy portion of the
Science seems to support the effective-
UV radiation spectrum – has been used to reduce the spread of bacteria, such as tuber-
ness of UV-C radiation in inactivating
culosis. Today, because of COVID-19, UV-C is becoming a rock star.
the COVID-19 virus. On its website, the U.S. Food and Drug Administration says that “UV-C radiation may be effective
News about UV-C “robots” – mo-
But cuteness doesn’t come cheap. These
in inactivating the SARS-CoV-2 virus,”
bile units that are wheeled into patient
units can cost anywhere from $80,000
[underscore added by the editors]. But
rooms or ORs for rapid disinfection – is
and $100,000, so it’s not certain how
the companies marketing UV-C units
showing up in daily newspapers, whose
widespread they will become. And at that
are more emphatic. They cite studies
editors are likely to compare them to R2-
price, they won’t make their way into the
that show 99% or more effectiveness in
D2. Hospital staff have even given them
physician’s office or urgent care clinic any
inactivating the virus in a hospital room in
names, including Jabba, Zappy and Flash.
time soon.
anywhere from 2 minutes to 15 minutes.
32
February 2021 | The Journal of Healthcare Contracting
Highland Hospital in Rochester, New York, was an early adopter of
Ann Marie Pettis, RN, BSN, CIC,
Can UVC radiation kill SARS-CoV-2?
FAPIC, director of ambulatory infec-
Here’s what the U.S. Food and Drug Administration says
UV-C technology, acquiring its first mobile unit about nine years ago, says
tion prevention and control. Prior to COVID-19, they were used primarily to
UV-C radiation is a
However, currently
radiation can be at
combat Clostridium difficile and norovirus
known disinfectant
there is limited pub-
inactivating viruses,
outbreaks. Today the environmental ser-
for air, water, and
lished data about the
generally. … UV-C
vices team operates their units to com-
nonporous surfaces.
wavelength, dose,
radiation can only
bat the coronavirus and other infectious
UV-C radiation has
and duration of UV-C
inactivate a virus if the
disease in the emergency departments,
effectively been used
radiation required
virus is directly exposed
patient rooms and ORs.
for decades to reduce
to inactivate the
to the radiation. There-
the spread of bacteria,
SARS-CoV-2 virus.
fore, the inactivation
Cost has been a factor in slowing down the adoption of UV-C units
such as tuberculosis.
in hospitals, says Pettis, who is also
For this reason, UVC
president-elect of the Association for
lamps are often called
Professionals in Infection Control and
“germicidal” lamps.
Epidemiology (APIC). In addition, the
UV-C radiation
science to prove their effectiveness has
has been shown to
been somewhat slow in coming. “These
destroy the outer
are not easy studies to devise,” she says.
protein coating of the
“But I think SARS-CoV-2 has increased
SARS-Coronavirus,
the interest level, and that might loosen
which is a different
some purse strings.”
virus from the current
UV-C isn’t a cure-all, she says. All
SARS-CoV-2 virus. The
surfaces must be cleaned prior to the
destruction ultimately
UVC treatment. “You can’t sterilize
leads to inactivation
dirt.” Furthermore, UV-C isn’t effective
of the virus. UV-C
on soft surfaces, and its effectiveness
radiation may also
diminishes in shadowed areas. “There’s some geometry associated with using
In addition to un-
of viruses on surfaces
be effective in inacti-
derstanding whether
may not be effective
vating the SARS-CoV-2
UV-C radiation is
due to blocking of the
them, as you want to make sure the
virus, which is the
effective at inactivating
UV radiation by soil,
UV light hits all the surfaces in the
virus that causes the
a particular virus, there
such as dust, or other
room.” That may mean opening draw-
Coronavirus Disease
are also limitations to
contaminants such as
ers, clearing off hard surfaces, and
2019 (COVID-19). …
how effective UV-C
bodily fluids.
treating the patient-room bathroom as a discrete area. What’s more, UV-C is a danger to eyes and skin, so once
Source: U. S. Food and Drug Administration, www.fda.gov/medical-devices/
the unit is positioned in the room, all
coronavirus-covid-19-and-medical-devices/uv-lights-and-lamps-ultraviolet-c-radiation-
personnel and the patient must leave
disinfection-and-coronavirus.
and close the door prior to turning on the unit.
The Journal of Healthcare Contracting | February 2021
33
INFECTION PREVENTION
Who’s who in UVC lighting Editor’s note: Not an exhaustive list, but the best we could do before deadline!
American Ultraviolet (Lebanon, IN)
www.americanultraviolet.com
> Permanently installed unit > Mobile unit > Handheld unit
CleanSlate UV (Buffalo, NY))
www.cleanslateuv.com
> UV “chamber” for disinfection of mobile devices
Dynamics Inc. (Pittsburgh, PA)
www.nanowaveair.com
Protec Scientific Inc. (Utica, NY)
> Tabletop unit inactivates aerosolized COVID-19 in fast-moving air
www.protec99.com
> Handheld unit
Puro (Lakewood, CO)
www.purolighting.com
> Mobile unit > Ceiling/wall fixtures
PurpleSun (Long Island City, NY)
www.purplesun.com
> Configurable mobile unit
R-Zero Systems (San Jose CA)
www.rzero.com
> Mobile unit
Sanuvox (Montreal, QC)
https://sanuvox.com/product/asept-2x
> Portable twin units
Steriliz LLC (Rochester, NY)
www.rduvc.com
> RD™ UVC System: mobile and fixed
Tru-D SmartUVC (Memphis, TN)
www.tru-d.com
> Mobile unit
UltraViolet Devices (Valencia, CA)
www.uvdi.com
> Mobile unit
UV Innovators (Cary, NC)
www.nuvawave.com
> NuvaWave handheld unit
Vioguard LLC (Bothell, WA)
www.vioguard.com
> Drawer-like unit for mobile devices > Self-sanitizing keyboard and trackpad
Xenex (San Antonio, TX)
www.xenex.com
> Mobile unit
34
February 2021 | The Journal of Healthcare Contracting
Defend with Profend
®
nasal decolonization swabs for better outcomes with reduced HAI* risk.
Efficient, effective bacterial decolonization can help lower HAIs*, length of stays, and costs.1 Profend® PVP-Iodine swabs kill 99.7% of S. aureus at 10 minutes and 99.9% at 12 hours after application.2 They are simple for the OR and ICU staff to apply for just 60 seconds, with a compact design for patient comfort. And CDC guidelines recommend nasal decolonization as a core strategy to prevent surgical site infections. Learn more at www.DefendwithProfend.com References: 1. Nelson R, Samore M, Smith K, et al. Cost-effectiveness of adding decolonization to a surveillance strategy of screening and isolation for methicillin-resistant Staphylococcus aureus carriers. Clin Microbiol Infect. 2010;16(12):1740–1746. 2. PDI in vivo Study 0113-CTEVO. *Healthcare-associated infections
BE THE DIFFERENCE®
©
2021 PDI
PDI11207196
PEOPLE
Managing Through Difficult Times National Account Executive of the Year said patience, bold visions will lead the way in 2021
Todd Betz, vice president, SCA, and the National Account Executive of
JHC: What do you believe it will take
the Year, talked COVID challenges, collaboration and commitment to success
to succeed in 2021?
with The Journal of Healthcare Contracting.
Betz: COVID has placed a heavy burden on healthcare, both occupationally and financially, and both will be a strain
The Journal of Healthcare Contracting:
on healthcare’s near-term future. Yet, a
How has your role changed/evolved
rebound of demand is expected. First, I
as a result of the last 12 months? In
would say be patient. Priorities will shift
what ways has it remained the same?
away from COVID-related supplies and
Todd Betz: 2020 has certainly been a chal-
care in 2021, but that doesn’t mean that
lenging year for everyone in healthcare. For
hospital purchasing activities will resume
me personally, the challenge of being ef-
to the pre-COVID levels immediately.
fective in my role while limited to working
Be both patient and supportive while
out of my home office on a daily basis has
hospital staffing levels and financial
been a bit of a struggle. I really enjoy being
health rebound.
around people. While phone calls and web
Second, have bold visions. Transac-
conferences do bridge the communication gap, they lack that missing personal
tional selling may quickly transition into Todd Betz
long-term partnerships that are driven by
element of a warm hand shake or a shared
standardization, risk sharing, and co-cre-
meal that can create a bonding opportunity
ation of new care models. Trust and Brand
between people. I’ve been in my current
called on me, I had the good fortune to
role for 12 years now, mostly with the same
know one supplier who really made it his
account, and that has certainly helped both
routine to understand my business and the
lieve that we will be back on airplanes and
me and my customer(s) manage through
challenges I faced. He positioned himself
attending large meetings and conferences,
this difficult time.
not as someone who wanted to sell me
that may not be the case. Employees may
something, but as an interested partner in
continue to work from home and the
JHC: Can you talk about the impor-
my business who was more of a collabora-
tools they use; cell phones, computers,
tance of collaboration in how you
tive consultant and trusted advisor.
social media may need to be polished and
will be critical during this transition. Last, reimagine sales. While we all be-
That’s how I approach the business
improved upon. Continue to look for new
Betz: Before my short 20 years at Siemens
today. The customer always comes first
and improved methods to have successful
Healthineers, I worked in the hospital and
for me, and I always look to add value for
encounters with your customer(s). As we
was a customer. My own personal experi-
them. I want my customer(s) to be success-
move into 2021, suppliers will value their
ence of managing a dynamic and fast-paced
ful, and I approach each day looking for
employees as their strongest asset and
Radiology Department presented me with
ideas and solutions that help them grow
greatly rely on the customer relationships
many challenges. While many suppliers
and/or improve their business.
which they have developed.
approach clients?
36
February 2021 | The Journal of Healthcare Contracting
TRENDS
BY NANCY ANDERSON AND CHRISTINE DEAN
Drafting a New Playbook Why the game plan for healthcare supply chain distribution needs to change now
Since March, pretty much every aspect of our lives has been turned upside
which healthcare products and services
down by COVID-19. There’s little normalcy left – so to keep our sanity – it’s important
are delivered should not be missed.
to find anything that reminds us of what life was like pre-pandemic.
This was the topic during a recent panel discussion hosted by SMI, a memberdriven, non-profit organization of provid-
During the fall and winter, football was one of those things. There was something comforting in turning on the TV on a Sunday afternoon and seeing football. Although, as we know too well,
to draft a completely new playbook to
ers, suppliers, manufacturers, distributors,
get there.
and disruptors. Executives from Cardinal
The same might be true for healthcare supply chain distribution. Thousands of healthcare organiza-
Health, Concordance Healthcare Solutions, Henry Schein, McKesson, Medline, and Owens & Minor talked about the recent
football was not the same. From no fans
tions in the United States depend on
challenges their organizations faced during
in the stands, mask coverings, wide-
distributors to deliver the right product
this crisis and what they will be doing dif-
spread testing, quarantines, and limited
at the right time – but the COVID-19
ferently in the future.
practices – professional football had to
pandemic presented a host of new chal-
completely change their game plan to
lenges to the industry. Although this was
There were 4 key themes that emerged in
keep players, coaches, personnel, and
an unprecedented event, and distribu-
the discussion:
fans safe. Although they delivered the
tion companies moved mountains to
same fast-paced, hard hitting, exciting
get supplies out to their customers, the
communication between buyers
action on Sunday afternoons – they had
opportunity to improve the processes by
and sellers
The Journal of Healthcare Contracting | February 2021
1. W e need better, more proactive
37
TRENDS
2. We need better sources of
historical demand was not a good pre-
for trading partners and the government
actionable data at all points in
dictor of current and future demand.
to exchange data and information to allow
the supply chain
Going forward, we need to use new
for full visibility and transparency across
tools and approaches to understand
all links in the supply chain to ensure
future demand and establish better
delivery of optimal patient care. The new
product allocation protocols. We
playbook should include ideas such as:
3. Transparency between all trading partners is critical 4. Collaborative relationships generate more rapid problem solving
should include the following tactics
and better outcomes
in the new playbook:
standards to allow for transparency
> Understanding demand drivers and The panel agreed that the healthcare industry can’t forget these and other
> Implementing industry-wide data along the supply chain
pivoting to adapt to changing drivers
> Creating information that is available
> Deciphering the difference between
real time and on demand at all points
lessons we’ve all learned from this crisis.
anticipatory demand and true
in the supply chain to allow for
It became obvious in the early stages
patient need and sharing that
response as a collective group and
that existing distribution models weren’t
real demand data upstream with
effective in a crisis of this magnitude –
manufacturing partners
organizations had to pivot quickly and operate differently, and they did. As with
not simply as individual entities
> Developing an open platform built
> Creating rational product allocation
on trust which gives the industry
protocols based on future demand
the ability to trace products back to place of origin to respond to all
It’s critical that we work together as an industry to ensure continuity of supply to get products to staff and patients as securely and effectively and in the most efficient manner possible.
forms of crisis
Collaboration and proactive communication There will be disruptions in the future, so we need to prepare and have relationships that can be most responsive to crises as they happen. Having these stronger
any good football team, the industry is
> Increasing investment in inventory
relationships now will mean that the
now taking what we learned, making
management solutions which
industry can cope more effectively in
adjustments and improvements, listen-
incorporate state-of-the-art demand
the future. Our new playbook should
ing and learning from one another, and
planning strategies and tools
include the following:
creating a new playbook to be better
> Creating effective communication
> Building and enhancing
prepared and more resilient for future
channels to share this new
collaborative partnerships now with
crises big and small.
demand data quickly and easily
key trading partners and adding
along the entire supply chain,
new relationships to the traditional
here are some ways we can change the
with consideration for emergency
sales interaction (sourcing to
playbook to drive different outcomes
government resources
Based on this SMI panel discussion,
sourcing, etc.)
> A focus on mutual success and the
going forward:
shared mission of caring for patients
Data sharing and transparency
– we all have the same aim, and
Future demand planning
The lack of product availability data was
we need to understand our trading
As we learned during the pandemic, al-
a huge challenge, especially at critical mo-
partners’ priorities and business
location was a challenge because demand
ments early in the pandemic. We need to
objectives as we work toward our
shifted so rapidly and dramatically that
update our playbook to include new ways
common goal
38
February 2021 | The Journal of Healthcare Contracting
As we learned during the pandemic, allocation was a challenge because demand shifted so rapidly and dramatically that historical demand was not a good predictor of current and future demand. Going forward, we need to use new tools and approaches to understand future demand and establish better product allocation protocols. > Maintaining open lines of communication
> Bringing product closer to the customer and
downstream, upstream, and across
building capacity to manage customer owned
stakeholders and sharing information
surge inventory
as it becomes available
> Working together creatively and pivoting to
It’s very apparent that recalls, disasters, pan-
new solutions for trading partner activities
demics, border closings and more are going to
as needed
continue, and we need to be nimble and flexible because the next crisis likely won’t look like this one. Taking the lessons we’ve learned these past
Supply chain diversification
few months and revising the game plan now is
It’s critical that we work together as an industry
critical for how we respond moving forward. It’s
to ensure continuity of supply to get products
time to stabilize our supply chain and prepare for
to staff and patients as securely and effectively
the future. Because the end game is still the same
and in the most efficient manner possible. We
– getting supplies into the hands of clinicians to
need to embed the learnings from COVID-19
protect employees and care for patients. Now is
into our work standards and include the follow-
the time to move forward with a new and more
ing priorities in our new playbook:
resilient playbook.
> Creating redundancy in the supply chain,
Many thanks to our SMI Distributors who
expanding supplier relationships and
participated in this discussion and contributed these
identifying non-traditional sources of supply
ideas for a new healthcare supply chain playbook.
NANCY ANDERSON Associate Executive Director, SMI
> Developing channels to increase supply through alternate manufacturing that can be activated in a crisis and validate these non-traditional suppliers in advance to be prepared for crises
> Diversifying the countries of origin for sourcing > Having an emergency resilience plan ready to implement by thinking ahead and doing advance scenario planning to include a pre-
For more information about SMI: www.smisupplychain.com. Follow us on Twitter: https://twitter.com/SMISupplychain
determined crisis formulary which set options
Connect with us on LinkedIn:
CHRISTINE DEAN
for acceptable alternate product
www.linkedin.com/company/smisupplychain
Senior Director, SMI
The Journal of Healthcare Contracting | February 2021
39
HSCA
BY KHATEREH CALLEJA
The Healthcare Landscape in 2021 Key trends to watch healthcare industry, HSCA has an intimate understanding of the challenges the healthcare industry will continue to face as it enters the 2021. Here are a few of the trends we are seeing as well as areas of focus and policy priorities that HSCA will continue to pursue in the coming year:
Supply chain resiliency
1 and diversification
The COVID-19 pandemic has underscored the importance of having a resilient and diverse healthcare supply chain. HSCA supports solutions that strengthen supplier resiliency and redundancy to help prevent disruptions to supply. The global The COVID-19 pandemic placed enormous pressure on hospitals, other
nature of the supply chain should be
healthcare providers and the communities they serve in 2020. Healthcare stakeholders
leveraged to build in redundancies, shor-
and public health authorities worked tirelessly to help address and prevent the spread of
ing up domestic manufacturing as well as
COVID-19 while continuing to also provide patient care on non-COVID issues. Poli-
sourcing across the globe to help prevent
cymakers on Capitol Hill pursued swift solutions to help support COVID-10 response
supply disruptions for raw materials or
efforts as well as solutions to a variety of healthcare issues ranging from drug pricing to
finished products. Previous shortages due
the drug shortages. With a new Administration taking over and the COVID-19 pandem-
to manufacturing issues or natural disas-
ic still ongoing, healthcare issues will once again be at the forefront in the year ahead.
ters like Hurricane Maria make it clear that it is important to have sourcing and manufacturing capabilities both domesti-
The Healthcare Supply Chain As-
vast majority of the 68,000+ long term
cally and globally to help ensure multiple
sociation (HSCA) represents the nation’s
care facilities, surgery centers, clinics,
suppliers and the ability to scale up as
leading healthcare group purchasing
and other healthcare providers. Given
needed. Increased redundancy will also
organizations (GPS), the sourcing and
our unique line of sight over the entire
reduce the risk of bottlenecks and severe
purchasing partners to virtually all of
healthcare supply chain and our experi-
disruption in the case of regional events
America’s 7,000+ hospitals, as well as the
ence working on the front lines of the
or other issues impacting manufacturing.
40
February 2021 | The Journal of Healthcare Contracting
GPOs have helped bring new or
raw materials and finished products. Ac-
expanded products to market with U.S.
cess to this information will enable FDA
have the potential to increase patient
manufacturers through long-term con-
and the private sector to plan for – and
access to safe, less-costly therapies
tracting to help support manufacturer
identify – potential shortages, consider
while reducing costs for patients, pro-
investment and sustainability. HSCA
backup supply, and take measures to
viders, and the healthcare system. As an
supports policy solutions that increase
help mitigate shortages before they
increasing number of biosimilars come
domestic manufacturing through positive
occur. HSCA supports measures like
to market, ensuring a robust uptake and
incentives such as public-private partner-
those included in the CARES Act, which
increased competition of these thera-
ships, tax incentives or loans, regulatory
strengthened reporting requirements
pies is critical to safeguarding patient
incentives, infrastructure investment, and
for manufacturers, including certain
access to life-saving treatments. HSCA
incentives technological advancements
information about active pharmaceutical
and its member GPOs support policy
such as advanced manufacturing to sup-
ingredients and other raw materials, and
solutions like the Fairness in Orphan
port production of quality medicines. We
we believe policymakers should further
Drug Exclusivity Act (H.R. 4712),
believe policy solutions should include
build upon these provisions.
which can help reduce drug prices
Like generic drugs, biosimilar drugs
long-term domestic manufacturing incentives to ensure a sustainable approach.
Upstream visibility
2 and drug shortages Ongoing product shortages continue to be a public health crisis and jeopardize patient access to affordable healthcare. HSCA is on the front lines of the shortage fight, leveraging our unique line of
The COVID-19 pandemic has underscored the importance of having a resilient and diverse healthcare supply chain.
sight over the healthcare supply chain to help hospitals and physicians avoid shortages, advocating for policy solu-
Generic drug competition
by closing loopholes that some drug
tions that increase competition and help
3 and biosimilar medications
address drug shortages, and participating
Prescription drug prices have been one of
in an attempt to prevent competition
in a multi-stakeholder working group
the leading drivers of overall healthcare
from entering the market. Additionally,
composed of leading healthcare provider
costs. Americans rely on generic drugs
authorities should examine payer poli-
organizations to develop policy proposals
to reduce costs and increase access to
cies that may prevent the adoption and
that prevent and mitigate shortages in a
necessary medication, and price spikes for
usage of biosimilars and consider how
comprehensive manner.
commonly used drugs jeopardize patient
payer policies can better incentivize the
access to care. HSCA supports policy so-
adoption of biosimilar products.
HSCA and its member GPOs con-
manufacturers have been exploiting
tinue to support policy solutions that
lutions that increase competition such as
provide the Food and Drug Administra-
eliminating pay-for-delay and other tactics
members remain committed to helping
tion (FDA) and the private sector with
that some brand name manufacturers use
hospitals and healthcare providers deliver
greater visibility into the source, location,
to prevent or delay generic competitors
the most effective and affordable care
and volume of manufacturing for both
from entering the marketplace.
possible to the patients they serve.
As we head into 2021, HSCA and its
Khatereh Calleja, J.D., President and CEO of Healthcare Supply Chain Association (HSCA)
The Journal of Healthcare Contracting | February 2021
41
HIDA
Frustrated By Glove Shortages? Talk with your distributor about alternatives and conservation strategies
First, ask your distributor to identify alternatives. Distributors are working every day to find safe, obtainable substitute products to fill demand. Importantly, manufacturers are dedicating more production lines to latex gloves, the raw materials for which are easier to obtain. While many providers favor nitrile gloves as they are less likely to cause an allergic reaction, innovations in latex-based glove production during the last 15 years have led to much-improved gloves. Your distributor can help you find the best substitutes. Second, adopt conscientious conservation strategies, as recommended by the CDC. Recognize that non-sterile gloves can To anyone involved in the medical products supply chain, the news report
be used for handling hazardous substances
late last year that a truckload of 6 million medical gloves had been stolen in Florida
like blood and body fluids. While some
came as no surprise. Gloves – in particular nitrile gloves – are in short supply and what
manufacturers provide expiration dates for
used to be considered a low-cost commodity is now viewed as one of the most valuable
non-sterile gloves, this is not required by the
types of personal protection equipment (PPE).
FDA and the gloves are safe for use beyond their expiration date. Gloves can also be used more than once if alcohol-based
Healthcare providers who are expe-
While glove manufacturers are work-
hand sanitizer or a thorough wash with
riencing glove shortages are not alone.
ing to increase capacity, it can take up
soap and water is used to sanitize them
In October, 40% of hospital customers
to a year to build a new production line
before moving to the next patient.
surveyed by Premier said they were expe-
capable of producing 10 billion nitrile
riencing glove shortages.
gloves annually. Even with added capacity,
remain so well into 2021. As the shortage
the tremendous increase in glove demand
persists, the internet has been flooded
have skyrocketed due to rapidly rising
has created a shortage of nitrile buta-
with unscruplous brokers and inexperi-
global demand and the duration of the
diene rubber, the raw material used in
enced novice operators who claim they
COVID-19 pandemic. Unfortunately,
nitrile gloves. The lead time for building
can fill the gap. But remember, everyone
glove shortages are likely to continue
processing plants to turn nitrile butadiene
is competing in the same global market
well into 2021. It is estimated that global
rubber into usable material is an even
from the same manufacturers who are
demand for gloves will top 585 billion
longer 18 months.
experiencing the same raw material short-
As with all PPE, orders for gloves
units in 2021, yet the total manufacturing
In light of these challenges, what
Supplies are tight – and are likely to
ages. Rely on the distributor you trust
capacity of glovemakers is only 370 bil-
should healthcare providers facing nitrile
to get the medical-grade equipment you
lion units, a 37% shortfall.
glove shortages do?
need from legitimate sources.
42
February 2021 | The Journal of Healthcare Contracting
CALENDAR Due to COVID-19 restrictions at press time some dates and locations may change.
Federation of American Hospitals 2021 FAH Conference and Business Exposition March 7-9, 2021 Washington Hilton Hotel Washington, DC
IDN Summit Fall IDN Summit & Reverse Expo August 30 - September 1, 2021 JW Marriott Desert Ridge Resort and Spa Phoenix, AZ
IDN Summit Spring IDN Summit & Reverse Expo April 12-14, 2021 Omni Orlando Resort at ChampionsGate Orlando, FL
Premier Breakthroughs Conference June 15-18, 2021 Washington, DC
SEND ALL UPCOMING EVENTS TO GRAHAM GARRISON, EDITOR: GGARRISON@SHAREMOVINGMEDIA.COM
Health Connect Partners’ schedules Spring 2021 Conferences as LIVE! Online Events Health Connect Partners announced
meetings are facilitated so you can talk
it will hold 2021 spring events as LIVE!
directly to your customers face-to-face.
Online Reverse Expo and Educational
“We know that most people are
experiences. Face-to-face interaction is
experiencing virtual fatigue right now,”
critical to our industry, even though being
shared Friedlander. “It sounds like a
in the same place is often still impossible.
pitch, but you really have to experience
Our LIVE! Online events offer Hospital
our events to understand how unique
Providers and Suppliers the ability to
they are. Even at the peak of virtual
engage each other directly in one of the
meeting burnout this fall, our customers
most unique platforms in the conference
genuinely loved participating in our 2020
industry – live, and together, online. “We
online conferences. In addition to the
have some exciting things in works with
educational offerings and virtual exhibit
our Nashville themed spring events,” said
experience, we were able to facilitate
Jim Friedlander, Sales Manager for Health
more than 50,000 connections in live,
Connect Partners.
1-on-1 online meetings during our 2020
The unique structure of this custom
2021 Spring Live Online Reverse Expo Dates
> 2021 Spring Hospital OR & Surgical Conference – LIVE ONLINE March 2 – 5,2021
> 2021 Spring Hospital Radiology Conference – LIVE ONLINE March 2 – 5, 2021
> 2021 Spring Hospital and Healthcare IT Conference – LIVE ONLINE March 2 – 5, 2021
> 2021 Spring Hospital Supply Chain Conference – LIVE ONLINE March 30 – April 2, 2021
> 2021 Spring Hospital Pharmacy
events. For the 2021 spring season, will
Conference – LIVE ONLINE
platform allows attendees to participate
continue to improve the HCP experience
April 27 – 29 & May 4 – 6, 2021
in leadership focused education; offers
by making this a fun, Nashville-themed
the ability to share products, services, and
season. Though we can’t physically host
technology in a Virtual Supplier Showcase
you in Nashville as we wish we could,
the Health Connect Partners’ 2021
exhibit setting; and creates a LIVE! Online
you will not want to miss what we have
events, please call 615.449.6234 or
Reverse Expo experience where 1-on-1
in store. Please make plans to join us.”
visit at www.hlthcp.com.
The Journal of Healthcare Contracting | February 2021
If you would like to be part of
43
LEADERSHIP
BY LISA EARLE MCLEOD
Two Things People Get Wrong About Purpose All the cool kids have purpose. Or so it seems. As more organizations begin to
engagement, better customer retention,
adopt corporate purpose statements, we see announcements on social media, a push for
and improved competitive differentia-
purpose-driven hiring, and CEOs deliver inspirational townhalls.
tion, all of which translate into better financial performance. After working in the purpose space
Yet for many front-line leaders, keeping an aspirational purpose alive in the
the face of stress and uncertainty, it often
for over decade, helping more than 200
falls by the wayside.
firms and authoring the two seminal
cadence of daily business is challenging.
The economics of pointing an
Much like keeping your fitness goals or
organization towards a higher purpose
I’ve observed two common misper-
parenting aspirations front and center
have been well documented. Aligning
ceptions that keep organizations from
during a pandemic, an inspirational pur-
your team around a noble purpose big-
reaping financial and emotional rewards
pose sounds great on your best day, but in
ger than money drives greater employee
of purpose.
44
books about Noble Purpose in business,
February 2021 | The Journal of Healthcare Contracting
Purpose is purely
1 about philanthropy
2
Purpose can’t be measured
own results, the team focused outwards on
Revenue and profit are front and
how they made a difference to clients. The
Yes, you can and should use your purpose
center metrics, but they’re actually lagging
leading indicator – time we saved clients
to make the world a better place. Yet, if
indicators. They’re the results of the be-
– helped them both predict and influence
your team thinks your purpose is about
liefs, behaviors, and words many months
the lagging indicators, like productivity, and
charity or simply doing good in your
ago. To assess a more qualitative pillar like
ultimately revenue.
community, it will get sidelined. Fast.
purpose, organizations must look towards
To ensure that your purpose drives your
leading indicators. You want to add met-
ACTION: Choose one simple metric to assess
organization, it must sit at the center of
rics that help you predict the future, not
progress against your purpose, even if it’s imper-
your commercial model.
just measure the past.
fect and anecdotal.
For example, when a banking client of ours landed on the purpose “We improve financial health,” one of their first actions was to create tools to help their customers assess their baseline financial health and harness their analytics to help their customers anticipate roadblocks that may hinder their financial health. This tells the team and their customers: Our purpose, the impact we have on customers, is the
Activate your purpose with your customers and employees before zooming in on philanthropy. You want to ensure you have concrete methods for delivering on your purpose inside your business model.
foundation of every action we take. We trained their team to focus on You can measure progress against
The world is changing. Brian Staf-
calls, and managers, even if they never
your strategic purpose by assessing your
ford, host of the recent World Eco-
interacted with customers directly, were
impact on customers and employees. The
nomic Forum: Measuring Stakeholder
trained to identify the impact their team
World Economic Forum recently released
Capitalism and CEO of Diligent says,
had on the customer’s financial health.
a comprehensive set of 21 Stakeholder
“There’s an evolution towards stakeholder
Capitalism Metrics firms can incorporate
capitalism, when the business round table
into their scorecard.
shifted and made that part of their stated
the customer’s financial health during
This ensures that everyone in the organization understands their role in delivering the purpose. Our counsel to clients is
In our experience with clients, we find
purpose, it allowed CEOs and boards
activate your purpose with your custom-
that layering on even a single metric for
to put a different framing from around
ers and employees before zooming in on
purpose can shift your strategic north. One
what the goals are. “
philanthropy. You want to ensure you have
of our clients is an IT firm whose purpose
concrete methods for delivering on your
is simply, “We help make small businesses
the past will not be how we measure
purpose inside your business model.
more successful.” When they began mea-
success in the future. If you want to
suring how much time they were saving
reap the reward of purpose, make it
ACTION: Train your team and front-line
their clients, team performance soared.
the center of your business and mea-
employees to activate your purpose with customers.
Instead of focusing internally on their
sure your progress.
The way we measured success in
About the author Lisa Earle McLeod is a leading authority on sales leadership and the author of four provocative books including the bestseller, Selling with Noble Purpose. Companies like Apple, Kimberly-Clark and Pfizer hire her to help them create passionate, purpose-driven sales organization. Her NSP is to help leaders drive revenue and do work that makes them proud.
The Journal of Healthcare Contracting | February 2021
45
NEWS
Industry News Premier releases data on shortages of supplies for COVID-19 testing, diagnostics and treatment
has increased more than 50%, and the
Premier, Inc. (Charlotte, NC) has released
volume of outstanding (open) purchase
of intent in October 2019. The hospital’s
orders has tripled – from 6 to 18 days of
parent company, Meadows Health Alliance,
supply on order, according to Premier
its board of directors, and the Toombs
data.
County Hospital Authority approved the
analysis of historic and predictive data from its supply chain forecasting technology to identify the latest supply categories at risk and assess how sourcing has fundamentally altered the economic landscape for gloves, gowns and N95s, as well as other key healthcare products. According to Premier, shortages are shifting from the personal protective equipment (PPE) scarcities that characterized 2020 to exponential demand for the supplies that play a vital role in COVID-19 testing, diagnostics and treatment. For vital PPE, including isolation
The parties previously signed a letter
sale of the medical center and its assets to HCA last week. The transaction, which
Other key findings include:
> Isolation gown usage has
still requires state approval, is expected to
doubled from September 2020
closed by April 30. Additional details of
to January 2021
the transaction were not disclosed.
> Surgical mask usage has increased 250% since June 2020 June 2020 and now exceeds existing
Pipeline Health System appoints new CEO
production capacity by 37%
Pipeline Health System, LLC (Los Angeles,
> Exam glove usage has doubled since
> N95 respirator usage has increased 500% since July
CA), a privately-owned, community hospital ownership and management company,
> Nitrile exam gloves were cited in a recent Premier member survey as
announced it has appointed Andrei Soran as CEO, effective immediately.
gowns, surgical masks, N95 respirators
the no. 2 greatest challenge to care
and exam gloves, average daily usage is at
for COVID-19 patients (after
remain with Pipeline Health and assume
an all-time high.
clinical staffing)
the role of senior vice president. Prior
Soran succeeds Jim Edwards, who will
to joining Pipeline, Soran led Trident
According to Premier data across a
USA Health Services, a mobile diagnostic
representative sample of health systems,
services provider serving customers in 37
inventories have fallen 50% – drifting
HCA plans to acquire Meadows Regional Medical Center for $73M
down to a median of just three days of
HCA Healthcare (Nashville, TN) to ac-
system based in California. Pipeline
supply on hand. Since May 2020, hospi-
quire Meadows Regional Medical Center
Health owns and operates facilities in
tals’ average daily usage of pipette tips
(Vidalia, GA) for $73 million.
Chicago, Dallas, and Los Angeles.
since May 2020, average daily usage of sterile water has increased 350% and
46
states. Earlier in his career, Soran served as CEO of Verity Health, a six-hospital
February 2021 | The Journal of Healthcare Contracting
Integra LifeSciences completes acquisition of ACell, Inc. Integra LifeSciences Holdings Corpora-
SMI announces three new appointments to its board of directors
tion (Princeton, NJ) announced it com-
SMI announced it has appointed Steve
pleted the previously-disclosed acquisition
Gundersen as the board chair, effective
of ACell, Inc.
January 1, 2021. In addition, Mary Beth Lang and Lara Latham have been ap-
ACell is an innovative regenerative medicine company with a product
Mary Beth Lang
portfolio based on a proprietary porcine
pointed as new members of SMI’s board of directors also effective January 1, 2021. Gunderson currently is VP and gen-
urinary bladder matrix platform technol-
eral manager of the Strategic Customer
ogy, MatriStem UBM.
Group for BD (Becton, Dickinson and
Integra announced on December 16, 2020, that it had entered into a defini-
Company). Lang is VP, chief supply chain
tive agreement to acquire ACell for an
& procurement officer for Kaiser Perma-
upfront cash payment of $300 million at
nente. Latham is VP, healthcare systems,
closing, subject to customary purchase
for Stryker Corporation. The SMI board consists of both
price adjustments, and cash payments of up to an additional $100 million upon
Lara Latham
the achievement of certain revenue
provider and supplier members to ensure it has a balanced representation of its membership to help guide the
growth milestones.
strategic direction of the organization.
“Acquiring ACell and its proprietary MatriStem UBM technologies will enable
Gundersen is a founding member, pre-
Integra to provide more comprehensive
vious board member and former chair,
complex wound management solutions
and has played a crucial role to drive
to address our customers’ most pressing
growth and recognition of SMI dur-
clinical challenges,” said Peter Arduini,
ing the past 16 years. Both Lang and
president and CEO, Integra LifeSciences.
Latham have been highly engaged and
“Together with ACell colleagues, we look
Steve Gundersen
forward to continuing to advance wound
respected members of SMI for over 10 years, the organization said.
care innovations for our customers and patients.” Final terms of the acquisition were not disclosed. The Next Generation Accountable
Michigan), New Jersey (Summit Medical
Trinity Health ACO achieves $24.4M in shared savings for 2019
Care Organization Model was created
Group) and Ohio (Mount Carmel Health
by the Centers for Medicare & Medicaid
System). Patients experience no change
Trinity Health ACO (Livonia, MI), a
Services (CMS) and is in its fifth year. It
in their original Medicare benefits and
Next Generation Accountable Care
sets financial targets, gives beneficiaries
retain their freedom to see any Medicare
Organization (ACO), achieved a 95%
opportunities to manage their own health,
provider. In order to share the savings it
quality performance score and $24.4
and enables providers to better coordinate
achieves for the Medicare initiative,
million in shared savings in perfor-
care across health systems.
mance year 2019. Trinity says this was
Trinity Health ACO provides coordi-
Trinity Health is committed to Advanced Alternative Payment Models.
its highest performance in its four years
nated care to patients in Illinois (Loyola
It has more than 15,000 physicians
of participation.
Medicine), Michigan (Mercy Health –
and advanced practice professionals
The Journal of Healthcare Contracting | February 2021
47
NEWS
committed to 16 Clinically Integrated
The clinic will serve the residents of
Advantus Health Partners and chief
Networks (CINs) that are account-
Freeborn County and the surrounding
supply chain officer, Bon Secours Mercy
able for approximately 1.5 million lives
service area.
Health. “Our advanced operations mod-
across the country through alternative
Phase one construction is focused on
el, integrated logistics solutions and our
payment models (APMs) across all
14,000 square feet and will house primary
alignment with clinicians in product and
populations and product lines: Medic-
care and some specialty services. In total,
device decisions enable us to provide
aid, Commercial, Medicare Advantage
there are five phases planned for the
a wide variety of strategic, customized
and Medicare ACOs.
64,000 square foot space. The first phase is
business solutions to partner facilities
expected to be completed by July 1, 2021.
across the country.”
Later phases will include services for out-
Indiana doctors form new Indiana Physician Coalition
Advantus will partner with commu-
patient surgery and retail. Officials hope to
nity hospitals, academic medical centers,
have everything complete within five years.
regional integrated delivery networks,
An alliance of Indiana physician organi-
national health systems, critical access
zations has formed the Indiana Physician
hospitals, ambulatory surgery centers and physician clinics to provide a variety of
include many of the largest medical as-
Bon Secours Mercy Health launches new GPO
sociations and specialty societies in the
Bon Secours Mercy Health has launched
flows and improving scale.
state and represent the vast majority of
a new group purchasing organization
nearly 17,000 practicing physicians and
(GPO), Advantus Health Partners.
Coalition. Members of the new group
solutions essential to streamlining work-
through purchasing, Advantus offers
Capstone Health Alliance welcomes Yolandi Myers as SVP of client solutions
educate lawmakers and the public about
expertise in distribution and logistics,
Capstone Health Alliance (Fletcher, NC)
how physician-led care protects patients
inventory management, clinical integra-
announced and welcomed Yolandi Myers
from harm, increases access to quality care
tion and many other integrated supply
as senior vice president of client solutions.
and helps control healthcare spending.
chain solutions.
2,000 medical students in Indiana, the group said in a press release. The Coalition says its mission is to
According to the IDN, in addition to identifying cost-savings efficiencies
In this new role, Myers will have over-
“Healthcare teams require leader-
The GPO will use advanced data
sight of partnerships with group alliances
ship, just as teams do in sports,” said
and analytic systems to help partners
and will work to enlarge member services
Roberto Darroca, MD, president of
modernize, track and inform sourcing
developing programs to ensure Capstone
the Indiana State Medical Association,
and logistic decisions to create more
Health Alliance members are constantly
a member of the coalition. “Physicians
efficient operations. With its experience,
receiving value.
bring to the team the highest level of
size and depth of industry knowledge,
Myers brings a variety of executive
training and preparation, which we use
Advantus is uniquely equipped to help
healthcare experience to the Capstone
to guide other members of the team to
organizations meet their business goals
team, most recently serving as SVP of
provide the highest quality of care pos-
and optimize their operations, including
Business Operations with the Center for
sible for patients.”
such critical but often overlooked busi-
Health Affairs/CHAMPS Group Pur-
ness areas as information technology.
chasing (Cleveland, OH). She has been
“We know for many health organi-
recognized as an expert in the industry
MercyOne breaks ground on its first clinic in Minnesota
zations, having the insight and counsel
frequently serving as a subject matter
that Advantus provides will be instru-
expert on a variety of community and
MercyOne (Des Moines, IA), the largest
mental in setting them up for future
national healthcare panel discussions as
healthcare system in Iowa, broke ground
success and reducing the overall cost
well as participating on select committees
this week on its first clinic in Minnesota.
of care,” said Dan Hurry, president,
with Premier, Inc.
48
February 2021 | The Journal of Healthcare Contracting
Midmark®® Workstations + Telehealth Midmark Workstations + Telehealth Enabling Healthcare from Anywhere ® Enabling Healthcare from Anywhere Midmark Workstations + Telehealth
It has been predicted that the telehealth market will see Enabling Healthcare from Anywhere 1 It has beensevenfold predictedgrowth that thebytelehealth market willassee significant the year 2025. Yet, of January 1 significant sevenfold growth by the year 2025. Yet, as ofa January 2020, 76% of healthcare organizations in the US lacked It has been predicted that the telehealth market will see virtual 2 2020, 76% of healthcare organizations in the US lacked a made virtualto care program. We can help. Midmark significant sevenfold growth by the yearWorkstations 2025.1 Yet, asare of January 2 care program. We can help. Midmark Workstations are made order 76% with of customization that can assistinwith the lacked integration of to 2020, healthcare organizations the US a virtual order with customization that can assist with the integration of telehealth and2 other technology at the Workstations point of care,are wherever care program. We can help. Midmark made to telehealth and other technology at the point of care, wherever that ordermay withbe. customization that can assist with the integration of that may be. telehealth and other technology at the point of care, wherever Learn more that may be. at: midmark.com/carefromanywhere Learn more at: midmark.com/carefromanywhere Learn more at: midmark.com/carefromanywhere Cameras not included.
1 https://ww2.frost.com/news/press-releases/telehealth-to-experience-massive-growth-with-covid-19-pandemic-says-frost-sullivan/#:~:text=In%202020%2C%20the%20 Cameras not included. telehealth%20market,%3A%2F%2Ffrost.ly%2F43e.&text=The%20opportunity%20for%20telehealth%20products,standard%20of%20care%20is%20growing 1 https://ww2.frost.com/news/press-releases/telehealth-to-experience-massive-growth-with-covid-19-pandemic-says-frost-sullivan/#:~:text=In%202020%2C%20the%20 telehealth%20market,%3A%2F%2Ffrost.ly%2F43e.&text=The%20opportunity%20for%20telehealth%20products,standard%20of%20care%20is%20growing Cameras not included. 2 https://go.forrester.com/press-newsroom/us-virtual-care-visits-to-soar-to-more-than-1-billion/ 1 2 https://ww2.frost.com/news/press-releases/telehealth-to-experience-massive-growth-with-covid-19-pandemic-says-frost-sullivan/#:~:text=In%202020%2C%20the%20 https://go.forrester.com/press-newsroom/us-virtual-care-visits-to-soar-to-more-than-1-billion/ © 2021 Midmark Corporation, Miamisburg, Ohio USA telehealth%20market,%3A%2F%2Ffrost.ly%2F43e.&text=The%20opportunity%20for%20telehealth%20products,standard%20of%20care%20is%20growing © 2021 Midmark Corporation, Miamisburg, Ohio USA 2 https://go.forrester.com/press-newsroom/us-virtual-care-visits-to-soar-to-more-than-1-billion/
We were impressed by the entire Premier team and their suite of dedicated tools, technology and innovation to help manage cost and create a healthy bottom line. - Ken Freeman, President, HRS
Contracting options. Technology. Total spend management. Check, check and check. When Health Resource Services (HRS) decided to upgrade their GPO, the decision was easy. With actionable data, clinical best practices and efficiency improvement strategies, Premier is ready to help HRS members put sustainable business practices into place to improve care quality while safely reducing costs.
Learn more about the power of a Premier partnership.
premierinc.com/HRS
Technology | Consulting | Collaboratives | Advocacy | Group Purchasing
Š 2021 Premier Inc.
