Providing Insight, Understanding and Community
June 2020 • Vol.16 • No.3
Catalyst for change Successful healthcare leaders require a new set of skills to succeed in a new era.
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CONTENTS »» JUNE 2020 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
Catalyst for change
FAX: 770/236-8023 e-mail: info@jhconline.com www.jhconline.com
Editorial Staff Editor Graham Garrison ggarrison@sharemovingmedia.com
Successful healthcare leaders require a new set of skills to succeed in a new era.
Managing Editor Daniel Beaird dbeaird@sharemovingmedia.com
Feature
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Art Director Brent Cashman bcashman@sharemovingmedia.com Publisher John Pritchard jpritchard@sharemovingmedia.com Vice President of Sales Katie Educate keducate@sharemovingmedia.com Circulation Laura Gantert lgantert@sharemovingmedia.com
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 2020 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
2 Publisher’s Letter: Three Themes 4 Reflection and renewal
Understanding what we have been going through, how we will get through it, and what steps we need to take to prepare for the next crisis.
8 What happens next
One expert discusses how we arrived at the crises that surfaced amid the COVID-19 pandemic, and what the road ahead may look like.
15 Navigating the journey
Ed Hardin helps guide students and young professionals through their potential careers
22 On the other side of the curve
With a continued reduction in COVID-19 cases, one health system was busy mapping out next steps to resuming elective surgeries and procedures
26 Resuming elective surgeries: A roadmap
contributing authors.
The Journal of Healthcare Contracting | June 2020
28 Resourceful and tenacious
Challenges abound, but so do solutions, amid the COVID-19 pandemic
34 Rallying around the caregivers
Distributors are working tirelessly to ensure product gets to providers.
36 Infectious disease expert: Infection preventionists are “essential” to the COVID-19 response 38 Pandemic sourcing checklist
Ten questions to screen potential healthcare supply sources … and avoid fraudulent brokers
42 Under duress
How to make decisions in a crisis
44 Into the line of fire
Tracing the footsteps of heroes
45 Calendar 46 Contracting News & Notes
Recent headlines and trends to keep an eye on
1
PUBLISHER’S LETTER
John Pritchard
Three Themes There are many new terms that have popped up within the last few months that I wish I’d never heard: ʯ COVID-19 ʯ New normal ʯ PPE shortages ʯ Antibodies ʯ Coronavirus ʯ Zoom ʯ Testing I am a self-diagnosed news junkie, but I’ve had enough. It’s all I can do to watch anything on television. I still read two newspapers a day, but even that is hard for me to do lately. I worry about the headlines as we continue into this new space with COVID-19. I worry we will have finger pointing at what could we have done, what we should have done, and what we didn’t do. Honestly, that’s all too simple. I refuse to be pulled into those conversations. Instead, I will share with you three themes that will help our U.S. healthcare supply chain going forward to be in the best shape it can be to serve our nation’s patients:
1. The way hospitals’ demand plan for product doesn’t work and will have to change. We will see a best-in-class model emerge that is data driven, and hospitals will be within best practices or they will be outside of best practices.
2. Responsible sourcing in the future will be the new standard. Hospitals will have visibility of their supplier’s supply chain, including all the supplier’s raw materials, work-in-progress, finished goods, and in-transit inventory.
3. Distribution will be coveted again as a vital and valuable link in the supply chain. The days of commoditizing distributors are over!
You will see more of these themes from us in this new space. Stay safe, be well and thank you for all you do! Thank you for reading this issue of The Journal of Healthcare Contracting!
2
June 2020 | The Journal of Healthcare Contracting
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SUPPLY CHAIN
BY DEE DONATELLI
Reflection and renewal Understanding what we have been going through, how we will get through it, and what steps we need to take to prepare for the next crisis.
I do not imagine that I’m alone in the fact that much time over the past few
Let’s break the past several months
months has been spent in reflection. The massive amount of information and inaccu-
down into phases and then project what
racy of the information being reported has been overwhelming and confusing; specifi-
might come next.
cally, as it relates to the healthcare supply chain. I am fearful that finger pointing may
4
result as we begin to reflect upon the process by which we source, procure and manage
Phase I: Prepare. Most partners, both
inventory. Most importantly, I hope that we have learned from this crisis and are willing
providers and suppliers, activated an
to renew our partnerships in a more innovative and improved approach to manage our
emergency preparedness of some sort.
supply chains.
We began to increase inventory levels as
June 2020 | The Journal of Healthcare Contracting
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SUPPLY CHAIN
the market allowed and, in some cases,
before experienced. We have little-to-no
imagine that when we can all come to-
might have begun to “hoard.” Suppliers be-
visibility upstream for availability, nor
gether at a conference or meeting, we will
gan to ration supplies based upon customer
downstream for demand. We are expected
be reflecting on this crisis for years.
status, contracts and relationships. Provid-
to make available supplies that we have
ers began to lock down or more closely
limitations in how to source nor any way
monitor specific PAR levels, locations and
to know when they may become available.
Revise our processes
allocation of request by departments.
We are woefully ill-prepared to sustain this
So, at these future meetings, rather than
level of support yet relied upon to do so.
finger pointing and talking about all the issues, problems, and shortages, we must
Phase II: Frenzy. This may seem insulting, but a frenzy is defined as an intense,
Phase IV: Reactivate. When stay-at-
spend the valuable time together to revise
often wild, state that is disorderly or
home directives and quarantines are lifted,
our processes for the future. Through les-
agitated; a period of great energy and
we will need to think about the reactivation
sons we have learned, we need to provide
activity. As I search for a descriptor for
of our regular healthcare delivery system.
greater visibility into the healthcare supply
the activities that supply chain endured
Specifically, return to the new normal in
chain. How do we bring suppliers and
during the height of the crisis, this defini-
our hospitals and care facilities. How do
providers together in true collaboration to
tion seems to be appropriate. Providers
we clean, restock, reconfigure (back to the
improve? We will need massive postmortem analysis, new playbooks and policies, and enhanced procedures for the entire
With the continuation of intense projected needs and unknown timelines we move into a state of sustaining a pace we have no way to understand or predict.
supply chain – providers and suppliers. We must work together as a healthcare continuum rather than individually. We discovered what does not work, so now we must renew and focus on what did work and what can be improved upon so the next time – and there will be a
and distributors were sourcing supplies
original designed state) departments? We
next time – we will be stronger, smarter
from new and even unknown suppliers,
will need to return the overstock of beds,
and nimbler to achieve a healthier supply
breaking traditional rules and histori-
oxygen cylinders, ventilators, room divid-
chain for our clinicians and patients.
cal barriers of acquisition. All through
ers, tents, trailers and excess emergency
limited visibility. Manufacturers began to
technologies; all while continuing to
crisis, supply chain is the backbone of
break down barriers to increase or modify
source and procure still limited supplies.
healthcare. We have a responsibility to
production at unheard-of rates.
We will likely be very conservative in
reflect upon and renew our profession,
this phase of activities as we “will never
partnerships and dedication to improve
Phase III: Support. With the con-
want to go through this scramble again.”
the process for our future. There has
tinuation of intense projected needs and
So what do we keep, store or rethink
never been a better time for supply chain
unknown timelines we move into a state
regarding stock levels (JIT), sourcing and
to promote our importance and sell the
of sustaining a pace we have no way to un-
procurement processes?
improvements we will make through the
derstand or predict. We call upon our basic
As we have learned through this
refection and renewal that we have an op-
supply chain management skills and adapt
Phase V: Renew. I am confident we will
portunity to achieve. The time is now, and
them to daily practices that we have never
come out of this pandemic renewed. I
I sincerely hope we seize the moment.
Dee Donatelli, RN, BSN, MBA, is vice president of professional services, TractManager, and principal of Dee Donatelli Consulting, LLC. She currently serves as chair of the Association for Healthcare Resource and Materials Management (AHRMM) board, is a 2015 Bellwether inductee and serving on Bellwether Board. She is past president of AHVAP.
6
June 2020 | The Journal of Healthcare Contracting
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EXECUTIVE INTERVIEW
What happens next One expert discusses how we arrived at the crises that surfaced amid the COVID-19 pandemic, and what the road ahead may look like.
In many ways, the COVID-19 pandemic was “the perfect storm” for the U.S.
low number of beds, “because we put
healthcare supply chain, said Dr. Eugene Schneller, a professor of supply chain man-
so much into outpatient surgical centers
agement at the University of Arizona State’s W. P. Carey School of Business, and the
and other settings.”
principal at Health Care Sector Advances.
Second, the U.S. has made an unrelentless push towards lowering costs. “One of the things we’ve done is push
8
“If you think about the last decade
And by doing that we turn out to be one
lean,” said Schneller. “Lean means that
to two decades in healthcare, the mergers
of the countries at the tail of the curve
we have relatively few products. We’ve
and acquisitions, the changes in technol-
of number of beds per thousand, with
pushed all of the distribution of those
ogy, a number of things have happened,”
one of the fewest.” While Japan, North
products over to our traditional distribu-
he said. “Number one, we pushed as
Korea and others are leaders in this
tors. And they then are looking at their
much as we could outside of the hospital.
area, the United States has a relatively
inventories and those inventories they’ve
June 2020 | The Journal of Healthcare Contracting
become more lean to in terms of how
look forward at this point, a month,
they manage those.”
two months and really worry a lot about
Department of Defense grant, Schneller
what’s going to happen.”
led a team that faced the same kinds of
Thus the perfect storm – reduc-
As the principal investigator on a large
tion in beds, outsourced products, and a
issues of maintaining large stores for
move toward lean. Also add the impact
emergencies. “But they understood that you need to be able to rotate stock,” he
not thinking ahead about how those big
Our obsession with cost ultimately cost us
organizations can respond collectively, we
“We’ve had this cost obsession,” said
piration dates on them. And if you can’t
have found ourselves in big trouble.”
Schneller, “and it’s really let lead to lean
move stock around very quickly, those
taking over all of our thinking.”
national repositories aren’t going to serve
of mergers and acquisitions. “Really, by
In a podcast recorded in mid-April 2020 during the COVID-19 shelter-in-
Lean can be wonderful in that it looks
said. “Various products basically have ex-
the purpose.”
place order, Dr. Schneller discussed the
at and deals with the issue of demand,
immediate and long-term implications
and it means that we can predict demand.
COVID-19 pandemic is we need a much
from the pandemic on the U.S. healthcare
“But one of the things we found out is
better interface between our public
supply chain with The Journal of Healthcare
we’re not very good at predicting demand
health supply chain and our everyday
Contracting Publisher John Pritchard.
for a pandemic.”
hospital supply chain, Schneller said.
What will happen in the second wave of disruption? As companies domestically as well as in China, India, and around the world find themselves economically challenged, what will the impact be to the U.S. healthcare supply chain? Schneller described the U.S. healthcare supply chain as one of the most resourcedependent supply chains that exists across
One of the realizations of the
Tier two and tier three suppliers – those who are making compounds that go into pharmaceuticals, parts that go into high tech or low tech devices – are very economically challenged due to COVID-19.
industries. “And hospitals are probably the most highly dependent on other “And we need to think about how to
think of,” he said. “They make almost
Linking public health with the everyday supply chain
nothing of what they use.”
There has been a huge separation of
we finance the fire department because
resources than any other industry you can
finance that,” he said. “Think about this;
planning for public health versus planning
we hope no houses will catch fire, but
those who are making compounds that
for everyday health in the United States,
they’re on standby. We need to know
go into pharmaceuticals, parts that go
Schneller said. This came to a head with
how to understand how to fund standby
into high tech or low tech devices – are
the national stores for pandemics. “We
in the supply chain, and we need to be
very economically challenged due to CO-
didn’t manage them very well,” he said.
able to divert some funding to do that.
VID-19. Some may go out of business.
There were products in warehouses for
I’m not sure if the national level is the
“I think that the hospitals will begin to
long periods of time that weren’t inspect-
only level to do it.”
see shortages in those devices, as well
ed and checked properly, or had expired.
as in the parts that are needed to repair
For instance, ventilators had parts that
visit: www.nationalaccountexecutives.
devices when they become inopera-
needed to be maintained or inspected,
com/2020/04/national-accounts-today-
tive,” said Schneller. “So I am trying to
such as plastic tubing.
episode-8-dr-eugene-schneller.
Tier two and tier three suppliers –
The Journal of Healthcare Contracting | June 2020
To listen to the full podcast,
9
10
June 2020 | The Journal of Healthcare Contracting
BY GRAHAM GARRISON
Catalyst for change Successful healthcare leaders require a new set of skills to succeed in a new era. The University of Tennessee Haslam’s Executive MBA for Healthcare Leadership aims to develop professionals who can lead these transitions.
The world is not slowing down. But with the right training and mindset, to-
online model, students attend four in-
day’s healthcare leaders may master the ability to drive change in “one of the most
person residencies during the year, com-
complex sectors of our economy,” said Jim Rosenberg, director, Executive MBA for
plete bi-weekly online distance learning
Healthcare Leadership for the Haslam College of Business, University of Tennessee.
sessions, and tackle applied homework assignments. In addition, each student completes an organizational action project (OAP) to apply new concepts to
ment of healthcare today, organiza-
Building solutions across the health sector
tions are under tremendous pressure to
UT’s Executive MBA for Healthcare
senior leadership of their organization.
reinvent themselves,” said Rosenberg.
Leadership specializes in developing
Students spend the entire year analyzing
“There is much experimentation and
leadership for administrators, nurses, phy-
an issue facing their organization and
change as healthcare leaders react to
sicians and other healthcare professionals.
work closely with an assigned advisor to
new payment models, risk sharing
The program builds on Haslam’s centers
craft and implement solutions (see ac-
models, customer satisfaction measures,
of excellence in supply chain manage-
companying sidebar).
expectations, and more. It is imperative
ment, Lean for healthcare, healthcare
we invest in the knowledge and capa-
finance, and more. “We work with leaders
the college’s Executive MBA programs,
bilities of these leaders who are driving
across the health sector who are building
have realized an average ROI for their
change in one of the most complex
solutions for the next chapter in health-
organizations of over $6.5 million, said
sectors of our economy.”
care service: a renewed era of affordable,
Rosenberg. “This thesis-like undertak-
accessible, equitable, and excellent care.”
ing is representative of the immediate
“In the rapidly changing environ-
As the healthcare industry continues
a strategic project developed with the
These projects, used in many of
to face challenges that demand increased
The Haslam EMBA-HL program’s
efficiency and quality of care, the need to
applied approach introduces new ideas
a time when healthcare is facing unprec-
combine healthcare industry knowledge
and challenges participants to put them to
edented changes, the OAP is a real-world
with broad strategic business founda-
work immediately, with the full support
investment that far exceeds the cost of
tions has never been greater. The Haslam
of expert faculty. “Participants grow per-
the program.”
College Executive MBA for Healthcare
sonally, see immediate movement on their
Leadership program is designed to meet
initiatives, and walk away with new capa-
alized leadership development curricu-
that need.
bilities that will support them throughout
lum, guided by structured assessments
their careers,” said Rosenberg.
and individual coaching. “We offer
“The Haslam EMBA-HL program is
application offered by this program. In
Students also participate in a person-
a catalyst for these healthcare leaders and
The Executive MBA for Healthcare
their organizations to successfully imple-
Leadership is a highly-applied, one-year
skills and evaluate personal leadership
ment change and deliver the next era of
degree program for experienced profes-
style allowing students to refine skills
healthcare,” said Rosenberg.
sionals. In this hybrid in-person and
while learning the business of healthcare.
The Journal of Healthcare Contracting | June 2020
meaningful course content on leadership
11
SUPPLY CHAIN U
across the health sector.
The healthcare environment today is changing dramatically, and at a rapid pace. Professionals across the sector are working to transition from a system designed for acute care; dependent on cross-subsidies for many patient populations; and with few mechanisms for cost control.
Critical competencies
The Executive MBA for Healthcare Lead-
including value-based payments, industry
The healthcare environment today is
ership curriculum is focused on building
consolidation, pricing and contracting
changing dramatically, and at a rapid pace.
six critical competencies for healthcare
transparency, and healthcare consumerism;
Professionals across the sector are working
leadership and transformation:
and direct application by students,” said
Our graduates become healthcare leaders who can drive innovation and change in their organizations.” “In all, students complete 45 credit hours in an accredited program,” said Rosenberg. The program model has been used by the college since 1994 and has supported the education of over 800 senior level healthcare graduates from
to transition from a system designed for acute care; dependent on cross-subsidies for many patient populations; and with few mechanisms for cost control. “The next era in healthcare is driven by a renewed focus on affordability and population health outcomes, which demands new attention to wellness, prevention, and chronic care,”
ʯ ʯ ʯ ʯ
Consumer centric thinking
Rosenberg. “This combination of concepts,
Business model innovation
cases, and application transforms the think-
Healthcare policy influence
ing and capabilities of students to lead and
Systems thinking and
transform the next era in healthcare.”
operational excellence
In addition to delivering the curricu-
ʯ Data and technology facility ʯ Change leadership and
lar needs of today’s healthcare professionals, Rosenberg said the learning
self-development.
model is designed to provide intense,
said Rosenberg. “Leaders must simultaneously improve equity in care, expand ac-
applied, and relevant opportunities for “The program weaves together core
learning that allows students to gain
cess, and contain costs without sacrificing
MBA skills; leading-edge cases, speakers,
information quickly and apply it immedi-
quality of care.”
and practices focused on key challenges
ately within their organizations.
A rare opportunity
High marks
Several U.S. universities offer healthcarefocused Executive MBA programs.
The Haslam College of Business executive education programs are recognized as among the best in the world, ranked #20 globally (Financial Times 2019). The Executive MBA is ranked #1 for relevance by participating executives (Economist 2018). Organizations that have participated include: ʯ Amedisys ʯ Northwestern ʯ Cigna Medicine ʯ Covenant Health ʯ Medtronic ʯ Pathways ʯ Anthem ʯ TeamHealth ʯ Centene ʯ UT Medical Center ʯ LifePoint Health
“What sets apart the Haslam Executive MBA for Healthcare Leadership is the core focus on preparing leaders to transform the industry by integrating business
ʯ Kindred Healthcare ʯ American College ʯ
of Cardiology Sutter Health
concepts to build creative solutions,” said Rosenberg. “Each cohort brings together highly experienced leaders from across the healthcare sector including providers, payers, and suppliers.” This provides a rare opportunity for deep exploration, collaboration, and
12
June 2020 | The Journal of Healthcare Contracting
A big thank you We are truly inspired by your selfless courage and unwavering commitment to your hospitals, healthcare facilities and organizations during this COVID-19 pandemic.
At Health Connect Partners, our goal is to connect providers and suppliers through educational meetings and conferences. Our mission is to provide the best in healthcare education and networking. We realize that the need for connection in our healthcare communities has never been greater, even though being in the same place is not possible right now. For our first ever Virtual Conferences held this spring, we facilitated those same one-one-one interactions our attendees have come to expect during our signature Reverse Expo, with no travel required. Thank you to all who participated in our inaugural Virtual Conferences, and thank you to the Educational Advisory Board for their continued support. We are beyond grateful to all of you for your understanding and willingness to make the Virtual CoNNection possible. Together we will always make a difference. For more information visit www.hlthcp.com
SUPPLY CHAIN U
“ The next era in healthcare is driven by a renewed focus on affordability and population health outcomes, which demands new attention to wellness, prevention, and chronic care.” ʱ Jim Rosenberg, director, Executive MBA for Healthcare Leadership for the Haslam College of Business, University of Tennessee
understanding across silos in the industry.
to handle adversity,” said Rick Smith, vice
“Haslam’s EMBA-HL is the only acceler-
president of operations - South Region,
ated one-year program allowing for quick
Pathways by Molina, an alum of the
adoption of leadership skills and business
program. “Led by innovative faculty who
acumen,” said Rosenberg. Students make
possess global experience, this program
an immediate impact on their organiza-
provides life-changing value to ensure you
tion through applied assignments to
have the skills needed to maximize your
advance their work and improve delivery
leadership potential.”
of care. The unique curriculum is driven
“We have over 20 years of experience
by a faculty with deep experience in the
leading healthcare executive education
healthcare, finance, operations, and strate-
programs,” said Rosenberg. “Participants
gic management sectors and dedicated to
grow personally, see immediate move-
student success.
ment on their initiatives, and walk away
“The greatest asset to success is
with new capabilities that will support
investing in yourself and being equipped
them throughout their careers.”
Organization Action Project A key component of the Haslam EMBA-HL program is the Organizational Action Project (OAP). Each student is required to complete an OAP to apply new concepts to a strategic project developed with the senior leadership of their organization. Students spend the entire year analyzing an issue facing their organization and work closely with an assigned advisor to craft and implement solutions. “The Organizational Action Project (OAP) was one of the highlights of the program,” said Jason Fugleberg RN, BSN, MBA, CENP, chief nursing officer, Brigham City Community Hospital. “The OAP allowed me to leverage the knowledge of faculty mentors and apply concepts learned throughout the academic year to a company initiative with a real financial return. The financial benefit of my OAP was more than $5 million. This project was a game changer for our hospital.” Other examples include: Implementing a remote-order-entry pharmacy service. The senior vice president of pharmacy for a hospital system with more than 42,000 employees and 100 hospitals worked with Randy Bradley, assistant professor of information systems and supply chain management at Haslam, to propose a proof-of-concept program for implementing a remote-or-
der-entry pharmacy service for after-hours order review in 10 hospitals. Although the proposal emphasized pharmacy job satisfaction, its ultimate significance was in the improvement of patient care and safety. The fiscal goal of the proposal was to break even on cost through savings generated by reduced pharmacist and nurse turnover. Initial conservative estimates showed these savings covered 43% to 88% of the service cost. Through data tracking, the proposal was able to show a break-even program and patient care was advanced at the same time. Growing a toxicology laboratory into a marketplace force. The vice president of business operations for a forensic toxicology laboratory with 30 employees in Nashville sought to grow her company into a competitive marketplace force. The lab, which specializes in sports organizations, medical examiners, crime labs, physicians and pain management clinics, was struggling financially at the time. Its leadership team was very serious about return on investment – requiring at least $10 for every dollar invested into its vice president’s Executive MBA program. That return on education investment ultimately capped out at more than $2,000 per dollar spent, and the business now boasts approximately 280 people.
To learn more about recent OAPs implemented by EMBA-HL students visit: https://haslam.utk.edu/healthcare-emba/oap
14
June 2020 | The Journal of Healthcare Contracting
BY GRAHAM GARRISON
Navigating the journey Ed Hardin helps guide students and young professionals through their potential careers
Everyone wants to play the hero. But every hero needs a guide to navigate
engagements related to his profession.
the journey.
Over time, as he started to do more of
That’s precisely the role that Ed Hardin, vice president, supply chain, Froedtert Health, has set out to play for many students and young professionals.
those, he said he got more comfortable. Then about seven years ago, Hardin began formally as an educator, and has taught in a college university setting ever
For almost 30 years, Hardin has
impression upon me. They reinforced
since. He was a guest lecturer for a time,
gravitated toward involvement in the lives
the importance of actively taking people
then became an adjunct where he taught
of young people, whether it be profes-
under your wing and helping them along.”
full courses. “I’ve enjoyed that work,”
sionally, through education, or community
he said.
service. “A lot of it stemmed from the
Hardin said he realized pretty quickly
fact that quite a few people during my
Pay it forward
that mentoring and coaching could serve
career early on before I turned 30 were
About 10 years ago, when Hardin began
others, as well as himself, by just simply
really strong mentors. Most of those guys
his membership and involvement in
learning from young people. “I also real-
are retired today, but they really left an
AHRMM, he also began to do speaking
ized that it actually became a great source
The Journal of Healthcare Contracting | June 2020
15
SUPPLY CHAIN U
of talent development,” he said. “In my
believe that resonates with young people.
continues to receive treatment. “I’ve still
shop, we have probably half of my per-
They have a different mindset around in-
got a long journey ahead of me, but the
sonnel are under 35.”
novation, and a different mindset around
chemo, and the good Lord are doing their
collaboration and working together.”
thing, and I’m doing pretty well. I’m still
Hardin said educating has provided a great opportunity to bring people into
Hardin said those under 35 years of
able to work. It gives me purpose, and
healthcare from different focus areas.
age value purpose in their work lives and
something else to think about. So it’s been
Many of them, either IT, finance, or
getting along well with others. “They want
a real blessing.”
supply chain for general industry, get
to work for organizations with a soul,” he
interested in healthcare as a result of the
said. “They want to talk about what we
courses. Hardin said he’s hired seven or
can do as a supply chain to not just move
The value for supply chain
eight former students in roles where he’s
product but to do good in this world.”
Hardin said bringing young profession-
worked. “I have a pretty good affinity for
One of his students has gone on to
als into healthcare positions benefits the
young people, enjoy working with them,
become a manager for sourcing. Most
individuals and the organizations willing
and enjoy bringing on talent. My getting
of them have been entry level roles, but
to invest in them. Supply chain teams
involved and practicing this has made
very good, stable roles. Hardin said many
could benefit from hiring young profes-
it easier over time to get better at it. It's
young professionals are coming to realize
sionals who perhaps don’t have experi-
been rewarding, fun, and energizing – and
that healthcare is a stable industry with
ence in healthcare but have other skillsets.
all because I've been intentional and tena-
typically not a lot of layoffs like other
By and large, supply chain in particular
cious about it, and I’ve really seen a lot of
segments of the economy. A handful of
has been plagued by some very “provin-
good outcomes.”
students he would eventually help get hired
cial” thinking over the years, he said. “We tend to promote people who have been
Hardin said bringing young professionals into healthcare positions benefits the individuals and the organizations willing to invest in them. Supply chain teams could benefit from hiring young professionals who perhaps don’t have experience in healthcare but have other skillsets.
in positions for long time, who may have only had a healthcare background, and may have only worked in that organization,” he said. “I think diversity is super important. I'm not saying that I'd want to hire everyone from the outside. That's not it at all. But I think the mix of different skillsets, and experiences, as well as youth, is really good for an organization.” Hardin said the three departments that he’s managed since he got back into the provider world benefited from transitioning from being very provincial
Topics that resonate
in healthcare started in another industry
and traditional to recognizing that there’s
Hardin said he has gravitated toward
before coming back to Hardin. “They got
value in people who may have worked in
teaching and lecturing on three topics in a
their degree and within a year had reached
other industries, and certainly people who
general setting – innovation, collaboration
out and said, ‘You know what, this isn't
are young, and very eager, and capable of
and values. “I’ve been very drawn to
working for me. And I think I'd like to
working hard. There’s strength in that.
innovation and unique solutions, as well
come to work in healthcare.’”
as collaboration, not just with kind of col-
16
Hardin was expected to teach at Mar-
laboration within my organization, but also
quette University this spring, but he has
Mentorship
with vendors and other hospital organiza-
taken a break. In November 2019 he was
The education doesn’t stop at the end of
tions doing things together,” he said. “I
diagnosed with stage four cancer, so he
a course. Hardin said he has traditionally
June 2020 | The Journal of Healthcare Contracting
taken on one to two mentees at any given
A boost to collaboration
his work with young people. “A lot of
time where he’s worked. Upon joining an
When young professionals are brought on
that has been formulated, and developed
organization as the new leader and peri-
board, Hardin said organizations will see
as a result of just working with young
odically in his communications with staff,
improvements in collaboration. “By my
people, and watching them work, and
he offers to be a mentor. “Not surpris-
very nature, I try to play nice in the sand-
realizing that some of the paradigms
ingly, few take me up on this offer, but
box, but younger people, I think, are bet-
that I might have carried going into
that’s perfectly fine,” he said.
ter at it. They see the value in being able
this industry I put aside, and realized I
It can be hard work. Hardin meets
to do that. I think they’re less competitive
can probably accomplish a lot more by
once a month with his mentees. They do
in an unhealthy sense. It’s not that they’re
intentionally, actively playing nicer in the
all the heavy lifting in terms of finding
uncompetitive, but they frown upon some
sandbox, and inviting people into that
time on Hardin’s calendar. At the end of
of the unhealthy aspects of competition.”
sandbox, so to speak. And I've learned a
each one-hour session, Hardin provides
Hardin said he is probably known in
lot of that just simply from working with
them a bit of homework. A few months
the industry for advocating collaboration
young people. I think they’re very, very
into the relationship, Hardin and his men-
among stakeholders. He credits that to
good at that.”
tee mutually agree on a book to jointly read and discuss together. “During our sessions we discuss everything under the sun; much of it professional, but also personal.”
About Froedtert Health
The split between those that work in
The Froedtert & the Medical College of Wisconsin regional health network is a part-
Hardin’s shop and those in other depart-
nership between Froedtert Health and the Medical College of Wisconsin. Its health
ments that he mentors is about 50-50,
network includes five hospitals, more than 1,700 physicians and nearly 40 health
he said. “With those that work within
centers and clinics. The health system operates eastern Wisconsin’s only academic
my shop, I get involved to a reasonable
medical center and adult Level I Trauma Center at Froedtert Hospital, Milwaukee.
degree in identifying and supporting
It is an internationally recognized training and research center engaged in thou-
where I believe they can best advance in
sands of clinical trials and studies.
our organization.”
The Journal of Healthcare Contracting | June 2020
17
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Specialty pharmaceuticals for non-acute – building a better model Specialty pharmaceuticals are expensive, require special handling and are growing in usage. What is the best way to manage these drugs?
Specialty pharmaceuticals can cause supply chain challenges “Specialized care – including the administration of specialty pharmaceuticals – is rapidly moving out of the hospital and into non-acute settings,” says Ann Gapper, senior director, Rx category management at McKesson. “Patients prefer the convenience of outpatient settings, and payers like the lower costs incurred there.” However, getting specialty drugs to nonacute locations, such as physicians’ offices, isn’t easy. It can cause your supply chain and pharmacy leaders a lot of headaches. Traditionally, health systems have either worked with numerous manufacturers or a specialty distributor to source their drugs. But managing orders from multiple suppliSpecialty drugs are more in demand now than ever. Want proof? While watch-
ers takes time and manpower, says Patrick
ing your favorite TV show this week, count the number of times you hear, “Ask your doc-
Baranek, senior manager, pharmaceuticals at
tor if BLANK is right for you” during a commercial break. These medications, sometimes
McKesson. “Supply chain may be servicing a
called specialty pharmaceuticals, are being used to treat conditions like Crohn’s disease,
network of 100-, 200- or even 500-physician
non-Hodgkin’s Lymphoma, leukemia, multiple sclerosis, and infections resulting from anti-
offices. Individual orders are placed either
cancer drug treatments, as well as more common conditions, including high cholesterol
over the phone to a variety of manufacturers
and hepatitis C. These specialized medications, which were once only given by specialists,
or by logging onto separate websites.”
are now being administered in physician offices and are being requested by patients.
Specialty pharmaceuticals present unique distribution challenges too, adds Jon Pildis, vice president, materials
18
But achieving better patient outcomes
require climate-controlled storage and spe-
management at McKesson. “You’re mov-
rests on something far more straightforward
cial handling. For these reasons and more,
ing vials that are worth hundreds, and in
than molecular research – supply chain
specialty pharmaceuticals represent one
some cases, tens of thousands of dollars.
management. Often administered by injec-
more opportunity for supply chain profes-
That high value means that you have to
tion or infusion, specialty pharmaceuticals
sionals to use their expertise in managing
be very careful with your processes.”
can be very expensive. And they’re highly
high-dollar, temperature sensitive products
regulated. Many specialty pharmaceuticals
while controlling costs.
Specialty pharmaceuticals also need to be in a temperature-controlled
June 2020 | The Journal of Healthcare Contracting
Delivering for you, so you can deliver a difference. Every day you’re making a difference in patients’ lives. We want to help make that easier. From our teams packing boxes to the ones bringing them to your door, we’re all-in to support the work you do. While you deliver care to those in need, we’ll deliver for you.
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environment to meet regulatory requirements, whether it’s refrigeration or frozen storage, he adds. Specialty drugs can be very challenging to correctly manage.
Simplify your pharmaceutical supply chain To meet the growing demand for specialty pharmaceuticals in the outpatient setting, supply chain and pharmacy
Quick quiz: What’s a biosimilar? As supply chain finds itself increasingly involved in specialty pharmaceuticals, you’ll start hearing a lot about “biosimilars.” What are they? While they are not the same as generic equivalents, biosimilars are highly similar to – and have no clinically meaningful differences from – existing, FDAapproved reference biologics. They are a rapidly growing treatment option for physicians treating advanced diseases, with more than 20 unique biosimilars expected to enter the U.S. healthcare market over the next decade.
leaders should consider simplifying their procurement processes by ordering these drugs through one supply chain expert. From a logistics perspective, using a distributor that handles specialty pharmaceuticals and traditional pharmaceutical offerings and med/surg supplies
Clinicians are finding that biosimilars: ʯ Expand treatment options for complex diseases. ʯ Offer substantial cost-savings on expensive therapies. ʯ Are FDA-approved, safe and effective treatments. ʯ Come with support from FDA and other leading medical advisory organizations.
and equipment can pay off and lead to better supply chain performance for its procurement team. “When expanding your clinical offerings to providing specialty drugs at your non-acute sites, you should consider how
distribution experience.
alleviate headaches,” he says.
We take these specialized,
“If you think about a health system that has already
high-value drugs, and run
you will handle these drugs,” says Pildis.
set up an account with a distributor like McKesson,
them through our logistics
“By supplying specialty pharmaceuticals
specialty drugs are one more product that can be
network, and get product
directly to alternate site locations, you
added to their orders, shipments and invoices,” says
to customers in an
will be sparing the health system’s supply
Gapper. “They can order directly from us and receive
efficient way.”
chain team from receiving, storing and
the product next-day with
physically moving them. What’s more,
high service levels. Plus,
being asked to tackle many
they can take advantage of
challenges facing health-
all the technology already
care – managing specialty
in place with us.”
pharmaceuticals shouldn’t
receiving specialty pharmaceuticals on a just-in-time basis helps clinics minimize on-hand inventory too. This reduces the financial burden on the non-acute staff.” McKesson offers supply chain managers the ability to order specialty pharmaceuticals via electronic data interchange (EDI) or use punch out, says Baranek. Supply chain managers will have a seamless connection and 24/7 access to their data with a business analytics tool. By accessing their non-acute data, supply chain managers understand where their spend is going, and see opportunities for
20
standardization and formulary management. “That helps
‘You’re moving specialty pharmaceutical vials that are worth hundreds, and in some cases, tens of thousands of dollars. That high value means that you have to be very careful with the way you manage your pharmaceutical supply chain.’
As a corporation,
Supply chain leaders are
be one of those. Look for
McKesson is one of the
a solution that provides
largest pharmaceutical
access to a broad product
distributors in the United
portfolio, an operational
States. “We work with
model that provides confi-
most manufacturers to
dence that the quality and
expand access to these
regulatory requirements are
life-saving drugs that treat
being met, and the simplic-
a variety of chronic con-
ity of integration with
ditions,” says Pildis. “We
existing processes. Same
leverage our non-acute
products, better model!
June 2020 | The Journal of Healthcare Contracting
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COVID-19
On the other side of the curve With a continued reduction in COVID-19 cases, one health system was busy mapping out next steps to resuming elective surgeries and procedures
At its high point, Ochsner Health was located in one of the nation’s COVID-19
concerns. Many people with medical issues
hotspots. The New Orleans-based health system had confirmed inpatient cases that
were fearful to leave their house. “That
reached into the mid-800s.
has significant implications,” said Thomas. “We’ve heard of people who have had strokes who delayed care out of fear. Minor
But there were positive signs by
heart attacks as delayed care. People with
mid-April. On April 17, the number of
broken hips that have delayed care for mul-
inpatient COVID-19 cases had lowered
tiple days. That is not a good situation.”
to 573. Another positive trend was more
Dr. Robert Hart, chief medical of-
people being discharged home who were
ficer, Ochsner Health, said ER physicians
COVID positive. Ochsner discharged its
had seen cases where a patient with a
1,500th COVID patient by April 20, just
heart attack stayed at home a few days
over one month after Ochsner admitted
rather than coming in for treatment. On
its first COVID-19 patient on March 9.
the surgery side when the stay-at-home
More patients were coming off ventilators and fewer were having to go on them. Warner Thomas, president and CEO
order was in place, Ochsner was only perbut these patients still need care. Cancer
forming emergency surgeries. “There are
surgery, heart surgeries and other things
some tiers of surgeries we laid out that
of Ochsner Health, said the health system
have been delayed, so it’s time to get back
could be put off and some that couldn’t,”
was working with local and state officials
to taking care of folks.”
Hart said. “We’ve got to begin consider-
on how to open back up some of its op-
ing getting people back on the schedule to
erations. “We’re working towards getting
get them taken care of before we wind up
ready to get back to do other surgeries
Delay of care
or procedures that we’ve had to delay,”
Thomas said one of the fears from a public
he told media members in a conference
health perspective is there were people de-
right precautions in its ERs and clinics
call. “We delayed them during the peak,
laying their medical care due to COVID-19
by temperature checking everyone that
doing more harm than good out of this.” Thomas said Ochsner was taking the
Dynamic Ventilator Reserve Program Ochsner Health was participating in the Dynamic Ventilator Reserve Program that has been put together by the COVID Task Force at the White House in conjunction with the American Hospital Association. The Dynamic Ventilator Reserve Program is “a collaborative voluntary effort led by a group of U.S. hospitals and health systems that has created an online inventory of
22
ventilators and associated supplies, such as tubing and filters, to support the overall needs of combatting the COVID-19 pandemic,” according to the AHA. “Hospitals and health systems will input into the database available equipment that they are able to lend to others in the country. Providers are then able to access this virtual inventory as their need for ventilators increases.”
June 2020 | The Journal of Healthcare Contracting
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COVID-19
comes into the organization, whether
and employees. By mid-April, the health
patient or employee. If anyone has a fever
system had tested over 23,000 people
you are going to be tested, whether you
they are getting tested appropriately and
for COVID-19, with more than 7,000
come in to be admitted, or have a proce-
sent home. Ochsner had the appropriate
confirmed cases – about one-third of
dure,” said Hart. “If you go to one of our
amounts of PPE for healthcare personnel,
Louisiana’s COVID-19 cases. Ochsner
infusion centers you are going to be tested.
and patients were given masks, he said.
had ramped up to conducting 1,300-1,400
For instance, if we give you chemotherapy
tests a day, either same-day tests or point-
or infusion that may compromise your
of-care testing.
immune system, we want to know first
“It’s important we don’t see ongoing delay of care, because frankly that’s going to create a bigger medical issue for folks going
Thomas said patients being admitted
“If you come into one of our facilities
whether you are positive or not. Because
forward,” said Thomas. “We worry about
into the ER for any reason were being
it may be something we want to put off a
the escalation of chronic disease or the
tested for COVID. People having surger-
couple of weeks for your safety.”
delay of care that need to be dealt with.”
ies were being tested proactively. “We’re
Ochsner started antibody testing the
making sure to test and screen people as
week of April 20. The initial focus was
they come in,” he said. The rate of testing
antibody testing for the frontline caregiv-
Testing
was only going to increase as the health
ers such as critical care and ED staff who
Testing for COVID had become a routine
system worked to begin surgeries and
have been working around COVID-19
part of the screening process for patients
procedures that had been postponed.
cases since at least early March. “There
Telehealth takes off Ochsner Health’s telemedicine platform, Ochsner Anywhere Care, is seeing record numbers of enrollments and visits since the COVID-19 outbreak in Louisiana, according to the health system. Patients are able to see a provider on-demand, receive assessment and appropriate treatment, all from the comfort and safety of home. In March 2020, urgent care on-demand and behavioral health scheduled appointments increased 852% in enrollments and 933% in virtual visits over February 2020, Ochsner reported in a release. The trend was continuing in April, with daily virtual visits growing significantly. Key highlights include: ʯ March 2020 Ochsner Anywhere Care enrollments: 10,084 (February 2020: 1,059) ʯ March 2020 Ochsner Anywhere Care virtual visits: 3,616 (February 2020: 350) ʯ April 2, 2020 Ochsner Anywhere Care virtual visits: 2,700 (March 2, 2020: 39) “It is reassuring and evident that those in need of nonemergent medical care are heeding the advice of local, state and federal officials during the COVID-19 outbreak and are sheltering-in-place, leaving only for essential er-
24
rands,” said David Houghton, MD, MPH, medical director of Ochsner Anywhere Care. “Telemedicine has made it possible to safely and effectively treat illnesses from home and we are seeing thousands of patients choose Ochsner for their virtual healthcare needs.” Ochsner Health was one of the initial six healthcare providers approved by the Federal Communications Commission’s Wireline Competition Bureau approved for its COVID-19 Telehealth Program. Healthcare providers in some of the hardest hit areas like New York could use this $3.23 million in funding to provide telehealth services during the coronavirus pandemic. As part of the recently enacted CARES Act, Congress appropriated $200 million for the FCC to support health care providers’ use of telehealth services during this national emergency “This is changing the landscape around virtual care,” said Hart. “Not only with patients, but physicians are realizing how effective they can be with certain types of virtual care. I think this is going to be something that does not go away when COVID-19 is gone. It’s going to be something that not only the physicians, but patients will be looking at – how does this continue going forward in some fashion that everyone finds useful.”
June 2020 | The Journal of Healthcare Contracting
Washington State Hospital Association to citizens: Don’t delay routine care Hospitals across Washington were urging citizens to seek timely medical care for non-COVID-related health issues, including care for new or chronic health conditions. Hospitals and health care providers across the state were reporting abnormally low volumes of patients seeking routine medical care, according to the Washington State Hospital Association. But patients who have arrived at the hospital seeking care have been more severely ill. People are waiting to seek medical attention – and endangering themselves as a result. “Life is on pause right now, but your health care needs are not,” WSHA President and CEO Cassie Sauer said. “Do not delay needed care – you could get worse. Hospitals and clinics are prepared to safely provide services and you should get care when you need it.” Health care conditions that are left untreated can worsen, making them more difficult to treat, or even become life threatening, the WSHA said. Many providers are offering virtual appointments, allowing patients to see
their providers at home and determine if a physical visit to a hospital or clinic is necessary. Pennsylvania: Elective surgeries can resume if guidelines followed The Pennsylvania Department of Health announced in late April that healthcare facilities could continue with elective procedures, as long as certain guidelines are followed. There are three main criteria facilities must meet before elective procedures can resume: ʯ First, facilities should make sure there is enough PPE in the event of a surge in COVID-19 cases. ʯ Second, facilities should be able to treat patients without having to resort to drastic measures like prioritizing patient care if there is another surge. ʯ Third, facilities should make sure there is enough trained and educated staff to handle elective procedures, as well as a potential surge in hospital patients.
is a sense now with people this was sim-
right conversation with folks coming in
organization’s revenue. Thomas reported
mering in our community in New Orleans
and talking through that.”
clinics, outpatient procedures and imaging
prior to Mardi Gras,” said Hart. “We may
Fortunately, the health system has
were down 60-70%. “It’s had a major
find out that a lot of people who could
not had to lay off or furloughed anyone,
impact on our revenue both at the end of
well have antibodies to COVID-19 not
Thomas said. “We’ve redeployed a lot of
March and the month of April.” Thomas
even realize they were exposed along the
people, taken folks that were less busy
said Ochsner was putting into place
way.” From there, testing would expand
and moved them to other areas.”
some expense reduction items, “things
to other inpatient areas, procedural areas, and into clinics.
Many Ochsner employees in areas less
we think we can put off, programs we
busy were taking their paid vacation during
can stop temporarily, hiring we will stop
April and May. “We’re doing that for a couple
temporarily in some of our areas,” he
of reasons,” said Thomas. “No. 1, because
said. “Certainly not in our clinic areas but
Financial impact
we have time for them to do it; we don’t have
other areas.”
Thomas said during the peak of the
as many patients. We also think in the second
While the organization was still evalu-
COVID-19 cases, Ochsner had delayed
part of the year, we are going to have to be
ating the extent of the economic impact,
well over 6,000 surgeries and procedures.
catching up with these 6,000-plus surgeries
a lot of it would depend on how quickly
“We’ll be in contact with those patients
and procedures, visits. We want people
people come back for medical care and
to get them scheduled soon,” he said.
ready to go in the second part of the year.”
what that looks like over the next couple
“We know many of those procedures need to be done. We’ll be having the
Indeed, the elimination of voluntary procedures has had a major impact on the
The Journal of Healthcare Contracting | June 2020
of months, Thomas said. “We’re going to be watching that carefully.”
25
COVID-19
Resuming elective surgeries: A roadmap 3. Personal Protective Equipment Principle: Facilities should not resume elective surgical procedures until they have adequate PPE and medical surgical supplies appropriate to the number and type of procedures to be performed. 4. Case Prioritization and Scheduling Principle: Facilities should establish a prioritization policy committee consisting of surgery, anesthesia and nursing leadership to develop a prioritization In response to the COVID-19 pandemic, the Centers for Medicare and
strategy appropriate to the immediate
Medicaid Services (CMS), the U.S. Surgeon General and many medical specialties
patient needs.
recommended interim cancelation of elective surgical procedures. 5. Post-COVID-19 Issues for the Five Phases of Surgical Care However, “when the first wave of this pandemic is behind us, the pent-up pa-
Principle: Facilities should adopt
1. Timing for Reopening
policies addressing care issues specific
of Elective Surgery
tient demand for surgical and procedural
Principle: There should be a sustained
to COVID-19 and the postponement of
care may be immense, and health care
reduction in the rate of new COVID-19
surgical scheduling.
organizations, physicians and nurses must
cases in the relevant geographic area for
be prepared to meet this demand,” The
at least 14 days, and the facility shall have
6. Collection and Management of Data
American College of Surgeons, American
appropriate number of intensive care
Principle: Facilities should reevaluate and
Society of Anesthesiologists, Associa-
unit (ICU) and non-ICU beds, personal
reassess policies and procedures frequently,
tion of periOperative Registered Nurses,
protective equipment (PPE), ventilators
based on COVID-19 related data, resourc-
American Hospital Association said a
and trained staff to treat all non-elective
es, testing and other clinical information.
joint statement.
patients without resorting to a crisis stan-
Facility readiness to resume elective
dard of care.
7. COVID-related Safety and Risk Miti-
In “Roadmap for Resuming Elective
2. COVID-19 Testing Within a Facility
Principle: Facilities should have and
Surgery after COVID-19 Pandemic,” the
Principle: Facilities should use avail-
implement a social distancing policy
organizations created a list of principles
able testing to protect staff and patient
for staff, patients and patient visitors in
and considerations to guide physicians,
safety whenever possible and should
non-restricted areas in the facility which
nurses and local facilities in their resump-
implement a policy addressing require-
meets then-current local and national
tion of care in operating rooms and all
ments and frequency for patient and
recommendations for community
procedural areas.
staff testing.
isolation practices.
surgery will vary by geographic location.
26
gation surrounding Second Wave
June 2020 | The Journal of Healthcare Contracting
We’re thinking of you. We know that many things have changed, your jobs, your workplaces, and your lives have changed. We want you to know we appreciate all you do as the country works through this pandemic, and just want to say‌
Thank you.
www.EcoVue.com
COVID-19
Resourceful and tenacious Challenges abound, but so do solutions, amid the COVID-19 pandemic
Editor’s note: In the following interview, Ed Hardin, vice president, supply chain, Froedtert Health, provided insights into how his health system has responded to the COVID-19 pandemic.
The Journal of Healthcare Contracting (JHC): Can you discuss your organization’s response to COVID-19? Ed Hardin: I got involved in the first weeks of my organization’s reaction to COVID-19 in an effort to prepare the organization for increased demands of affected patients. We then moved into an Enterprise Incident Command approach, which directly involves more than 50 and many more indirectly. It’s part of the Hospital Incident Command and a pretty standard and approved way of addressing disasters, and crises. It’s not too unlike what first responders do during natural disasters. We have a number of different sections within that governance. One of them is called the Logistics Section, and I’m the section chief. Within that, our responsibility is basically providing resources where there is a need. It’s not just supplies; it’s HR related, IT related, and training related. It involves a host of things. My world had been primarily supplies and equipment, but this is far
Ed Hardin
broader. Most hospitals actually, I believe, are functioning this way – the big ones for
28
sure. I’m real proud of our organization
Hardin: It’s in large part a different and
hose, but it’s a close organization – par-
for what we’re doing.
very intensive type of project manage-
ticularly at the leadership level, we enjoy
ment, I was trained in project management
and respect and one another. So, it's made
JHC: How do you approach
in the early 2000s but never had to apply
easier by that but it’s definitely a different
this situation compared to
this learning in such a critical way. We’re all
dynamic. People’s titles go away. It’s really
the regular supply chain work?
learning and kind of drinking from a fire
what you know. So, it’s interesting work.
June 2020 | The Journal of Healthcare Contracting
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COVID-19
JHC: How are you navigating
I would tell you that my sense is,
leader need to be a part of it. Because
supply disruptions or shortages?
because of our academic affiliation,
if you’re on the outside, you’re probably
Hardin: As of right now (early April),
that the community seems to be pretty
going to get inundated with requests
I feel pretty comfortable where we’re
engaged with us. Milwaukee in general
that aren’t really put into proper context.
at, but the situation is very fluid. Unlike
is a very, very generous city. The state
You’re just simply going to be in reaction
California and New York, we’ve had time
is a very generous state, and so that’s
mode. But be a part of it, be actively a
to prepare (in Milwaukee). And so, we’ve
demonstrated in the type of gracious
part of it.
become quite the resourceful group. Our
support that people are giving our
regular suppliers are reliable in the sense
hospital. I hear the same for the other
on steroids, right? I think that being
that we’re getting supplies from them,
hospitals. Our cup runneth over, so to
resourceful and tenacious involves some
but we’re all on allocation. We’re not get-
speak, at Froedtert Health in terms of
level of risk. And I can tell you that your
ting what we would want, we’re getting
what the community is doing. Again, we
typical suppliers aren’t going to meet
what they can give us. That means that a
haven’t had a big surge of patients, so it
your needs, and therefore you’re going
lot of our purchases in the last three to
remains to be seen, but I'm feeling pretty
to have to be tenacious, resourceful. It’s
four weeks have been on allocation.
comfortable right now.
oftentimes up to the CFO or the CEO,
This situation is project management
but unless you’re willing to wade into the international supply chain market, I
We’ve hit a lot of bumps in the road, but we’ve been resourceful and tenacious. I think those are the two words of the day – resourceful and tenacious. Many of us are working around the clock to see to it that these things happen.
think it’s going to be tough, because the local guys, your regular suppliers, can’t supply. Incidentally, most of the suppliers – and by suppliers in this reference I mean companies that are coming your way and wanting to help you buy masks, and gowns, and other PPE – nearly all of them got into this business two months ago. Now they’re in it, and some are unsavory. I think that’s part of the risk that you share, but you’re going to have
Dollar wise, probably pretty high,
30
JHC: What suggestions would
to really sort through it, roll up your
we’re working with suppliers that we
you give to other supply chain
sleeves and vet these guys. We have been
normally don’t do business with. In some
teams on how to stay sane
fortunate that most of the work we’ve
cases, we’re having to deal directly with
during a crisis like this?
done has been with companies that have
the manufacturers in China. So we are
Hardin: I’ve been pretty healthy, de-
not been in this business before, but
covering new ground for our organiza-
spite my health situation (Hardin was
came to us at the recommendation of
tion. I think we’re doing a pretty decent
diagnosed with stage four cancer in
very respected leaders at our medical
job, given our experience in this space.
November 2019), but I was near my wits
school or within our health system. That
We’ve hit a lot of bumps in the
end until we implemented the Enterprise
is the kind of a level of vetting that puts
road, but we’ve been resourceful and
Incident Command. While the situation
my mind at ease. But yeah, this is about
tenacious. I think those are the two
can be frustrating because you’re having
being resourceful, tenacious, and having
words of the day – resourceful and
to learn something new, I think that this
a willingness to take risks. And I know it
tenacious. Many of us are working
actually helps us. My advice is that if
makes us feel uncomfortable, but organi-
around the clock to see to it that
your organization has an Incident Com-
zations are going to have a difficult time
these things happen.
mand Operation, you as a supply chain
if they’re not willing to do that.
June 2020 | The Journal of Healthcare Contracting
SPONSORED
ENCOMPASS GROUP
Pulling Together How Encompass Group stepped up to fill a need during the COVID-19 crisis
As the cases of COVID-19 spiked across the United States, John Wood and the
up again domestically or in this hemi-
team at Encompass Group were like a lot of companies – they wanted to help in any
sphere if the need arose.”
way they could. Fortunately, as a leading manufacturer and marketer of textiles, apparel,
Within three days, Encompass Group
therapeutic support services, and single-use medical products, they had the ability to do
began the process to start suppling PPE.
just that.
“But we did have a few challenges that we needed to face.” Wood spoke about those challenges,
“A friend at Vizient and I were talking
Wood, CEO of Encompass Group,
and other ways in which the organization
and I told him, ‘It might be a crazy idea,
recounted in a recent podcast with John
is helping America’s frontline caregivers
but Encompass has a 510(K), and in the
Pritchard, publisher of The Journal of
amid the COVID-19 pandemic, during
past had been a manufacturer of PPE,”
Healthcare Contracting. “We could set that
the podcast.
The Journal of Healthcare Contracting | June 2020
31
SPONSORED
ENCOMPASS GROUP
The PPE process
C. Love and GLO Good Foundation
healthcare workers. Indeed, in healthcare,
The first step toward producing the PPE
Co-Founder Dr. Jonathan B. Levine.
the line between partners and competi-
supplies involved validating with the FDA
The episode featured footage including
tors had become blurry on a normal day.
that the changes Encompass would make
jackets being packed and shipped out by
The current crisis has only enhanced
were going to be acceptable. The FDA
Encompass Group.
collaboration among industry stakehold-
had set up a portal where people could
ers. “Everybody’s working together,” said
Encompass Group was also the
start applying to manufacture this type of
source of 10,000 scrub units being
Wood. “It’s been a positive thing to see
product domestically, “but there was quite
donated by Jockey International to the
how everybody’s pulling together to come
a backlog there,” said Wood.
healthcare staff at the Jacob K. Javits
up with a solution.”
Wood had a conversation with another business partner, Jockey Interna-
Convention Center in New York City. “I think we’ve all seen on the news
To listen to the podcast, visit: www.jhconline.com/podcast-encompass-
tional. Wood told the COO about what
where healthcare workers were com-
group-steps-up-to-fill-need-during-covid-
Encompass was doing and two days
ing home and changing in their garage
19-crisis.html.
later he had used some of their connections to get in touch with the task force led by Vice President Mike Pence. Just like that, “we were on the phone with the FDA,” Wood said. “We described what we were doing and we were approved within an hour.” Within four weeks, Encompass went from idea, to procuring the necessary equipment and raw materials, to producing and shipping PPE.
SHARE donation
The Encompass Group SHARE donation was part of tens of thousands of pieces of protective gear conveyed from private and corporate donors to hospital healthcare staff in over a dozen hard-hit states.
On April 8, as the first of many efforts to respond to the national emergency to combat COVID-19, Encompass Group
because they don’t want to bring things
announced a direct corporate donation
into their home,” said Wood. “They are
through SHARE, a national call-to-action
having to do laundry every other night
program established by the Society of
so they can keep up with the workload.
Nurse Scientists Innovators Entrepre-
For them to have at least one more set of
neurs & Leaders (SONSIEL) in partner-
scrubs, hopefully that helps a little bit in
ship with the GLO Good Foundation.
the things that they’re facing.”
The Encompass Group SHARE donation was part of tens of thousands of pieces
32
of protective gear conveyed from private
Working together
and corporate donors to hospital health-
With the challenge before the U.S.
care staff in over a dozen hard-hit states.
healthcare sector, Wood said the team
ABC News Nightline featured
at Encompass Group feels fortunate to
SHARE program activity with SON-
be able to continue to work and contrib-
SIEL President & Co-Founder Rebecca
ute to meeting the needs of America’s
June 2020 | The Journal of Healthcare Contracting
GROUP ONE is code for success ®
PROFESSIONAL HEALTHCARE APPAREL
PARTNERING WITH ENCOMPASS GROUP BRINGS YOU OUR EXPERTISE AND BELIEF THAT BETTER CARE STARTS WITH SAFETY AND COMFORT. BRANDING: Create and Maintain Professional Image SECURITY: PATIENT EXPERIENCE: Help to Improve HCAHPS Scores EMPLOYEE SATISFACTION: Quality, Style, and Comfort EASE OF ORDERING: Online Solutions
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© 2020 Encompass Group, LLC All Rights Reserved. GROUP ONE is a registared trademark of Encompass Group.
COVID-19
Rallying around the caregivers Distributors are working tirelessly to ensure product gets to providers.
of product across a wider group of essential purchasers. This is accomplished by placing temporary limits on the quantities any particular purchasing entity can purchase at any given time. It is commonly based on historical demand. Looking back over a defined period of time, distributors would then make that amount of product available to customers. There were several reasons for this. “One is to make sure that it’s a signal so customers understand there’s a potential supply issue, that the historical amount of supply that’s been available may not be available in the future,” Eliasek said. “It’s a signal to our customers to conserve and to make sure that when they’re using these products that they need to be using The warning bells began to go off in January. Back in January when COVID-19 started to build, there was an impact to the production of personal protective equip-
them effectively.” Allocation is also a way for distribu-
ment (masks, gowns, face shields, gloves products), because a high percentage of those
tors to maintain the supply chain and
products are made in China. McKesson anticipated the product disruptions that would
have product available for customers
happen as a result of the situation in China and began to plan accordingly.
when they need it. “A lot of our customers don’t have a lot of space within their facilities,” said Eliasek. “Their facilities
“It’s a relatively long supply chain and
to how McKesson and other large
are dedicated to caring for patients, and
it takes some time for those products
national distributors are working with
so they might have a small supply closet
to be made and then get to the United
the government to get products into the
or they might keep products in a cabinet
States,” said Joan Eliasek, senior vice
hands of providers.
somewhere. They don’t have space to put
president of Customer Experience for
weeks’ worth of product. They rely on
McKesson. “So we knew then that there
them in our distribution centers. And so
Healthcare Contracting, Eliasek discussed
Once it was determined that product
product won’t be available, we use this
McKesson’s efforts to support caregivers
supply would be disrupted due to condi-
allocation methodology, which is not per-
and communities during the pandemic.
tions in China, distributors were forced to
fect but does help us maintain products
Topics ranged from allocation of med-
employ allocation strategies. Allocation is
so that our customers will have it as they
surg products and why that’s happening
a methodology to spread a limited supply
continue to use it.”
In a podcast hosted by The Journal of
34
us to maintain those products and keep
Maintaining supply amid a pandemic
would potentially be a shortage of supply.”
when we see that there’s a possibility that
June 2020 | The Journal of Healthcare Contracting
Another reason distributors use al-
dock, but don’t go inside the facilities to
before, there are certainly new sources of
location is to ensure products don’t get
limit the exposure they have to particular
these supplies that are becoming avail-
shipped to an e-commerce provider or re-
patients. There are new cleaning proce-
able,” she said. “And so I feel confident
seller looking to profit on the opportunity
dures for McKesson trucks, and PPE
that over time we’ll be able to have more
that’s created when demand increases.
equipment is being issued to drivers such
product available and be able to meet the
as wipes and gloves.
customers’ needs.”
At the warehouses, workers have
Eliasek said she received an email from
Collaboration and adaptation
their temperature checked as they start a
one of McKesson’s inside sales reps that
Eliasek said one of the positive develop-
shift, follow social distancing guidelines
illustrated the commitment distribution
ments amid the pandemic has been see-
and wear masks and gloves. They also
has in response to COVID-19. The rep
ing how distributors are working directly
have been asked to self-monitor their
was shopping at a grocery store next door
with the White House and FEMA. “All
temperature to help identify anyone who
to one of McKesson’s customers when
of the key distributors in the industry
has a high temperature isn’t in the facility
a McKesson truck pulled up. Without
are working very closely with FEMA,”
and potentially coming into contact with
revealing he worked for McKesson, the rep
said Eliasek. This includes daily calls so
anyone in the building, said Eliasek. “So
told the driver he appreciated what he was
that FEMA officials better understand
there are a lot of things that we’ve put in
doing. “I’m not the hero here,” the driver
the supply chain, the product that’s
place to make sure that those folks are
responded. “These healthcare providers
available, and ensuring products get to
safe. And we have a fair amount of train-
are the heroes. I would work 24 hours
areas deemed COVID-19 hotspots. In
ing to help them understand what needs
a day if they asked me to because it’s so
those areas, distributors are coordinat-
to be done, and really all of that has been
important that these products get to these
ing with FEMA, as well as government
driven by CDC recommendations.”
end users so they can do their jobs.”
agencies such as state and local departments of health. Within their own internal organizations, distributors have had to adjust to a new reality. At McKesson, all officebased employees with the exception of a few running operations are working from home. McKesson made investments in technology and systems for its customer service reps to be able to field calls from customers remotely rather than a call center. Reps are using “safe
“ While the demand is much, much higher than before, there are certainly new sources of these supplies that are becoming available. And so I feel confident that over time we’ll be able to have more product available and be able to meet the customers’ needs.” ʱ Joan Eliasek, senior vice president of Customer Experience for McKesson
zone protocols” where they do as much as they can from home unless they need to resolve a specific issue onsite
Committed to the providers
for customers.
Despite the challenging environment,
one at McKesson feels, “that we will do
there are reasons for optimism. Eliasek
whatever we can to make sure that these
to protect employees at its distribution
said the McKesson team is working tire-
providers have what they need. We’d love
centers. For instance, historically private
lessly to find product and to make sure
to be able to give them everything and
fleet drivers may have gone into a facility
the integrity of the supply chain is in
we’re trying really hard to get it more
to deliver product or put the product
place. Conditions in China are improving
of the product and get it available, and
away in a storeroom. With a new safe
with more product flowing out. “While
we’re starting to see a light at the end of
zone delivery policy, drivers come to the
the demand is much, much higher than
the tunnel as far as that’s concerned.”
McKesson also put measures in place
The Journal of Healthcare Contracting | June 2020
Eliasek said that’s a sentiment every-
35
FRONT AND CENTER
Infectious disease expert: Infection preventionists are “essential” to the COVID-19 response Almost overnight, infection disease experts in the United States went from
equipment appropriately and safely. “It is
obscurity to sought after sources. In some cases, such as Anthony S. Fauci, MD,
also important for IPs to work with hos-
director of the National Institute of Allergy and Infectious Diseases, they’ve become
pital leadership to help deliver consistent
household names.
and clear messaging to healthcare workers and patients. With social media and the internet many ‘urban health legends’ can
So too, has the spotlight shifted
a challenge. “We are not working in a con-
rapidly emerge and it is important to mes-
at IDNs and hospitals on the role of
trolled environment – and in many cases,
sage clearly and consistently.”
infection preventionist.
we have to make important decisions
Keith Kaye MD, professor of medicine, division of Infectious Diseases, University of Michigan Medical School, and
based on little data and rapidly emerging
Learning, and looking ahead
science,” he said. The basics of IP, and adherence to
Our healthcare system will need to be less
past president of Society for Healthcare
those basics, remain critically important.
reliant on single use infection prevention
Epidemiology of America, said in the fight
Examples of critical IP basics include
items (like n95 masks) in the future, Kaye
against COVID-19, infection prevention-
hand hygiene, appropriate use of airborne,
said. “We will need to have reprocessing
ists, or “IPs” are involved in all essential
droplet and contact precautions, and
alternatives clearly worked out. Hospitals
components for preparation and response.
making certain that healthcare workers are
will also have to consider stockpiling
They are involved in key decision making
aware of how to don and doff protective
more PPE and avoid ‘just in time’ order-
and planning with regards to issues ranging
ing of supplies.”
from PPE supply and use, methods to
We also are too reliant on China for
perform urgent surgery and procedures
many of medical supplies, “and when they
safely, and when necessary, helping to
are dealing with their own pandemic issues,
optimize infection control in field hospitals
our supply chain can be hugely impacted.”
and temporary structures built to manage
Kaye said as much as we tried to learn
overflow of COVID patients. “They are
and prepare after SARS and H1N1, we
also very important with regards to helping
clearly were not prepared for this pan-
with the messaging to patients, the public
demic. “We have faced critical challenges
and healthcare workers.”
with regards to PPE supply, ventilator availability, surge capacity of hospitals, and testing methodologies and supplies.
36
Infection prevention in hot spots
Also, public health in some areas was
For many hospitals and health systems
completely overwhelmed even in the early
within what are considered hotspots for
stages of the pandemic – we need to com-
COVID-19 cases, maintaining proper infec-
mit to a stronger public health infrastruc-
tion prevention amid a crisis is undoubtedly
ture as a country moving forward.”
June 2020 | The Journal of Healthcare Contracting
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PATIENT CARE
INTERVENTIONAL CARE
ENVIRONMENT OF CARE
PRIME DISTRIBUTOR
PROVIDED BY THE HEALTH INDUSTRY DISTRIBUTORS ASSOCIATION
Pandemic sourcing checklist Ten questions to screen potential healthcare supply sources … and avoid fraudulent brokers
Since COVID-19 invaded the United States, the healthcare supply chain has
proof of the current location of
faced a dramatic increase in demand for medical supplies.
the inventory? 4. Can you offer references? 5. Can you provide a sample?
This situation is ripe for abuse by
6. Can you provide a copy of your
fraudulent brokers – individuals or busi-
quality manual?
nesses armed with little knowledge of the
7. Can you provide the company’s
healthcare industry and its stringent quality
W-9 and/or business license?
requirements – who dive into what they see
8. Can you provide a financial
as an opportunity-rich market. The goal of
snapshot, including a recent
these brokers is to facilitate deals between
income statement?
sellers and buyers in the unofficial “gray
9. Can you provide proof of
market.” Brokers do not take ownership of
510(k) clearance?
products. Industry acceptable transportation
10. Can you provide product cut
controls are not guaranteed, increasing
sheets?
the risk for lost or damaged shipments. Brokers are focused on individual transac-
A request for advance payment
tions, not long-term business relationships
should raise a bright red flag. There
with either the buyer or the seller. A bro-
Agency’s (FEMA) recent efforts to screen
have been multiple reports in which the
kered transaction is ripe for price-gouging,
1,000 new supply offers resulted in only a
broker vanishes after receiving the funds
especially in times of high demand.
handful of viable purchases.
they say are needed for the purchase.
The media has reported multiple
So how can you understand the differ-
accounts where during the COVID-19
ence between a fraudulent broker and a
the physical items before paying for the
pandemic, brokers have profiteered from
professional, qualified distributor?
shipment. It also will allow you to verify
delivering high-priced, substandard or
the quality of the supplies.
counterfeit medical supplies, or simply
The 10 questions below can help buyers
disappeared with the money without mak-
spot warning signs before any payment is
ated by COVID-19, distributors have
ing a delivery at all.
made. Reliable distributors will be able to
been working diligently to identify new
provide rapid and verifiable responses to
PPE sources. Their goal is, as it always
vetting questions, brokers will not.
has been, to provide quality medi-
In contrast, established healthcare distributors typically serve as a single trusted source through which providers buy a
1. Are you able to demonstrate
To meet the increased demand cre-
cal supplies quickly and efficiently to
full range of medical products critical
proof of product registration
healthcare providers on the frontlines
to everyday operations. They are known
with the Food and Drug
of this pandemic.
to the nation’s hospitals, nursing homes,
Administration (FDA)?
physician practices, home health organizations, and other healthcare providers. Vetting a supplier is not a simple process. Even the Federal Emergency Management
38
Do not be shy about requiring access to
More information on sourcing offers
2. How long have you or your source manufactured medical supplies? 3. Can you provide current
for PPE from unknown sources can be found by visiting the Health Industry Distributors Association’s COVID-19 Resource
inventory levels and photographic
Center, HIDA.org/coronavirus.
June 2020 | The Journal of Healthcare Contracting
SPONSORED
OLYMPUS
Purchasing departments said “prove it.” With our Endocuff-assisted colonoscopy device, we took the challenge and we are glad we did BY BETH WALL, DIRECTOR OF HEALTH ECONOMICS AND REIMBURSEMENT, RN, MS, OLYMPUS
in a statistically significant and clinically relevant improvement in ADR, as compared with unassisted colonoscopy, due to its design, which maximizes visualization of the mucosa. For each 1% increase in ADR, there is a 3% reduction in the risk of interval colorectal cancer (CRC).1 ADR is shown through meta-analysis to be 14% higher with Endocuff-assisted colonoscopy compared to standard colonoscopy (29.8% vs. 25.8%).2, 3, 4 But with all its clinical advantages, the Endocuff would still add a cost for each case, one that the healthcare provider or payor would have to absorb. What our stakeholders needed, from payors to hospital purchasing depart“Prove it.” Hospital purchasing departments have good reason to ask medical
ments to physicians who wanted to make
device companies to provide proof that investments into new technologies will make
a case for using Endocuff, is proof of
good sense. But what and how should medical device companies be presenting such
return on investment. We had a strong
proof to their potential customers?
theory, based on reasonable assumptions, that cost savings and health benefits could
At Olympus, we recently had an op-
detection rate (ADR), one of the most im-
be reflected in terms of the patient’s
portunity to show the economic value of an
portant indicators for prevention of inter-
ability to avoid CRC and the associated
investment in our ENDOCUFF VISION
val colorectal cancer (defined as cancer that
medical and cancer treatment costs. It was
(Endocuff) technology – and the response
recurs between colonoscopy screenings).
on us to make the case.
from hospitals and other stakeholders
40
The Endocuff device attaches to the
has encouraged us to pursue additional
distal end of a colonoscope, with multiple
economic value research for other products
flexible “arms” that fold within the prod-
from many of our medical business units.
uct during intubation and forward move-
First, we engaged a third-party researcher
ment and open out when drawn backward,
We identified the researchers at Guide-
thereby flattening the bowel folds and
house, and a team led by Tiffany Yu,
What we set out to prove
controlling the field of view. Olympus En-
whose experience in evidence develop-
We knew from clinical data that our
docuff received FDA 510(k) clearance in
ment across a variety of indications has
product, the Endocuff, improved adenoma
2016 for the claim that the device results
been shown to inform reimbursement
June 2020 | The Journal of Healthcare Contracting
guidelines6, 7, 8 that have been set to gauge
health economics and outcomes research
Third, we used economic modeling to assist in generating findings and the clinical study results were the starting point
(HEOR) and a proven record of rigorous
To hasten patient benefit, it is useful to
screening, treatment and outcomes for
research, as well as presentation experi-
rely on models. Yu had identified the Mar-
the average screening patient, beginning
ence at professional society conferences.
kov model, with its origins based in gam-
at age 50 over a lifetime — and com-
ing theory, as an ideal tool for this analysis.
pared these to patients screened with
It is important to note that the model
Endocuff-assisted colonoscopy.
and adoption discussions for payor and provider decision makers. We were interested in a partner with expertise in
the effectiveness of new innovations applied to healthcare. The model built for this economic study looked at CRC
Second, we educated ourselves on the baseline: particularly WTP
used clinical trial data, based on real world evidence, for its extrapolations. Starting
through health states representing
The medical community’s work toward
with the multiple clinical studies that had
screening (no CRC diagnosis), CRC
a “willingness to pay” (WTP) model has
CRC screening patients were tracked
diagnosis, metastasis, remission and
been a useful one. Between NICE, which is based in the U.K., and the analysis of health policy experts in the U.S., the thrust of such analysis has been to review the impact of quality adjusted life years (QALY) of patients with the use of the device. In the case of Endocuff, facilities understand that while there could be a benefit to the device, it is not necessarily one that is measurable with each individual patient, as in the cases of patients
We were interested in a partner with expertise in health economics and outcomes research (HEOR) and a proven record of rigorous research, as well as presentation experience at professional society conferences.
death. Probabilities of transitioning between health states were applied annually. Patient outcomes included CRC incidence, CRC-related death, life years and QALY. Three stakeholder perspectives were evaluated: the device purchaser, the health plan, and the fully integrated accountable care organization (ACO) responsible for both device and medical costs. These perspectives were consid-
with no adenoma detected. Given such
ered separately and together. Lifetime
uncertainties, it is necessary to measure
Endocuff device costs were considered
the cost over the entire patient population
showed that use of Endocuff during
for the device purchaser; and lifetime
and analyze the benefits.
colonoscopy resulted in higher ADR, she
medical costs were considered for the
could then draw models over time.
health plan. The fully integrated ACO
Over time, as reflected in meta-analysis , 5
the WTP per QALY threshold in the U.S. is at $50,000.
This model was developed in compliance and accordance with international
was assumed to be responsible for device and medical costs.
To view more on this article visit: www.jhconline.com/olympus-endocuff-vision-technology-proves-its-worth.html orley DA, Jensen CD, Marks AR, et al. Adenoma detection rate and risk of colorectal cancer and death. N Engl J Med. 2014;370. C Chin M, Karnes W, Jamal MM, et al. Use of the Endocuff® during routine colonoscopy examination improves adenoma detection: meta-analysis. World J Gastroenterol. 2016;22(43):9642–9649. doi:10.3748/wjg.v22.i43.9642 Hepatol. 2017; 16(8):1209–1219. 3 Patil R, Ona MA, Ofori E, Reddy M. Endocuff®-assisted colonoscopy-A novel accessory in improving adenoma detection rate: a review of the literature. Clin Endosc. 2016;49(6):533–538. doi:10.5946/ce.2016.032. 4 Facciorusso A, Del Prete V, Buccino RV, et al. Comparative efficacy of colonoscope distal attachment devices in increasing rates of adenoma detection: a network meta-analysis. Clin Gastroenterol. 5 Neumann P, Cohen J, Weinstein M. Updating Cost-Effectiveness — The Curious Resilience of the $50,000-per-QALY Threshold. N Engl J Med 2014; 371:796-797. DOI: 10.1056/ NEJMp1405158 . 6 Caro JJ, Briggs AH, Siebert U, Kuntz KM. Modeling good research practices–overview: a report of the ISPOR-SMDM Modeling Good Research Practices Task Force–1. Value Health. 2012;15(6):796–803. doi:10.1016/j.jval.2012.06.012. 7 Eddy DM, Hollingworth W, Caro JJ, Tsevat J, McDonald KM, Wong JB. Model transparency and validation: a report of the ISPORSMDM Modeling Good Research Practices Task Force–7. Value Health. 2012;15(6):843–850. 21. 8 Roberts M, Russell LB, Paltiel AD, Chambers M, McEwan P, Krahn M. Conceptualizing a model: a report of the ISPOR-SMDM Modeling Good Research Practices Task Force–2. Value Health. 2012;15(6):804–811. doi:10.1016/j.jval.2012.06.016 22. Siebert U, Alagoz O, Bayoumi AM, et al. State-transition modeling: a report of the ISPOR-SMDM Modeling Good Research Practices Task Force–3. Value Health. 2012;15(6):812–820. doi:10.1016/j. jval.2012.06.014. 1 2
The Journal of Healthcare Contracting | June 2020
41
LEADERSHIP
BY LISA EARLE MCLEOD
Under duress How to make decisions in a crisis
“In every deliberation, we must consider the impact on the seventh generation…
clients to make decisions during a time of
even if it requires having skin as thick as the bark of a pine.”
uncertainty, plus a fourth question for all
The seventh generation principle comes from the Native American culture, where
of us to ponder.
it was used to make decisions large and small. Putting yourself in the position of future generations provides a frame that helps you do the right thing.
1. W ho does your organization serve? In a crisis, leadership decisions have outsize impact and importance. We’ve
As I reflect upon where we are and
42
We’re in a defining moment. Whether
seen what happens when leaders focus
where we might do good, I find myself
you are in public service or the private
on short-term quarterly capitalism. It
thinking deeply about leadership; the type
sector, the decisions you make today will
erodes morale and creates a transac-
of leadership that got us here, and the
define you for years to come. Here are
tional relationship with employees and
type of leadership we need going forward.
three frames I’m using with my leadership
customers. During a crisis, focusing on
June 2020 | The Journal of Healthcare Contracting
short-term earnings will erode reputa-
4. How can you express empathy?
tion and trust overnight.
Any teacher or parent will tell you that
2. If you were an employee, what would you want your leader to do? Leaders are being called upon to make tough decisions. Many have watched
5. Who does our government mean to serve?
empathy is a hard skill to teach. The ability
Does our government exist to reward
to lean into and understand the feelings of
our top producers? Or is the purpose of
another is crucial for leaders, and it’s criti-
government to serve the least among us?
cal for successful personal relationships.
My spiritual beliefs tell me it’s the latter.
Lately I’m thinking about the impact
A question I often ask myself is, how
their business evaporate overnight.
empathy (or lack of it) has on our collec-
would I want my children treated if they
Financial decisions and health decisions
tive spirit. I’ve worked with organizations
had been born poor? It’s only by accident
have suddenly become comingled. Lead-
where empathy is in short supply. At first,
of birth that I was born to a college edu-
ers will do well to consider, if I were in
it coarsens the culture, then eventually
cated couple with good jobs and a hard
the shoes of the lowest level employee
it poisons it, as people turn against each
work ethic. I didn’t create that for myself,
in my organization, what would I want
other. When leaders lack empathy, it’s
any more than my children chose their
my leader to do? What safety precau-
contagious. People double down on their
parents. What kind of world do we want
tions would I want them to take? What
own agendas as a way to self-protect.
to provide for less fortunate children?
financial measures would best serve the
When everyone is focused on short-term
team? To make it even more personal,
self-interest, organizational failure follows.
As I think about our future, I find myself thinking deeply about wisdom of the
here’s a question I’ve used in challenging situations: If one of the people in question were my child, how would I want their leader to handle this? 3. How do we want to be remembered by our customers? You don’t have to give away the store. You do want to think long and hard about how your customers are doing to look at your actions. One of our clients in retail made the decision to
Any teacher or parent will tell you that empathy is a hard skill to teach. The ability to lean into and understand the feelings of another is crucial for leaders, and it’s critical for successful personal relationships.
close, another in healthcare made the decisions to stay open, others, like some of our banking clients, are doing
As I work with our clients to help
7th generation principle. As Oren Lyons,
a hybrid. The lens they are using is,
them make good decisions, I continue to
Chief of the Onondaga Nation writes:
what’s best for our customers? Notice,
be impressed by their deep-seeded desire
“We are looking ahead, as is one of the
there’s a nuance to that. It’s not, what
to do the right thing. As we’ve seen many
first mandates given us as chiefs, to make
do our customers want? They may
times before, when things are at their
sure and to make every decision that we
want your restaurant to stay open. It’s
worst, people are often at their best.
make relate to the welfare and well-being
about asking, what’s best for people
Lastly, here’s a question I was thinking
and how do we want them to remember
about before this crisis that I find myself
our actions?
asking even more urgently today.
of the seventh generation to come.” When they look back in time, what will the seventh generation think about us?
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, purposedriven sales organization. Her NSP is to help leaders drive revenue and do work that makes them proud.
The Journal of Healthcare Contracting | April 2020
43
PEOPLE
TOM ROBERTSON, EXECUTIVE DIRECTOR, VIZIENT RESEARCH INSTITUTE
Into the line of fire Tracing the footsteps of heroes
Heroes come in all shapes and sizes. The dictionary defines a hero as a person
families of their own, who worry about
who is admired for courage, outstanding achievements or noble qualities. Common
them and about whom they worry, but
synonyms for the adjective heroic are bold, courageous and valiant.
who put it on the line every day in spite of being tired, in spite of being scared. Healers. Caregivers. Sources of comfort.
When I think of heroes, my mind
Ports in the storm.
tends to focus on courage, and more
Ordinary folks who we might see at the
Heroes.
specifically on courage in the face of im-
grocery store, or whose car we park next
Before the international outbreak of
minent personal danger. People like Audie
to at our kids’ soccer games, who lay it
the virus, I had just begun reading a book
Murphy, the most decorated soldier of
all on the line for the rest of us when
about an obscure Polish resistance agent
World War II, or Eddie Rickenbacker, the
disasters strike.
named Witold Pilecki, who got himself
greatest American flying ace of World I,
44
in response to emergency distress calls.
There are heroes among us as we face
incarcerated in the concentration camp
or the Tuskegee Airmen, who overcame
this global outbreak of the COVID-19
at Auschwitz on purpose. To establish a
prejudice and social barriers to put their
virus. Doctors, nurses and lab technicians
bridge to the outside. To get word to the
lives at risk as fighter pilots.
standing in the doorways as patients are
world from inside the barbed wire. The
We lost more than 400 first respond-
wheeled in. Patient transporters, dietary
title of the book says it all in two simple
ers at ground zero on 9/11 – firefighters,
staff who bring meals, and maintenance
words: The Volunteer.
police officers and emergency medical
staff who sterilize treatment spaces
technicians who were last seen running
before patients arrive and after they leave.
of the fight ... to the caregivers and first
into buildings just before they collapsed.
Long-term care staff who protect the vul-
responders who run into the line of fire
Coast Guard rescue crews who head out
nerable elderly, and ICU staff who care
not away from it ... to the heroes, we say,
of safe harbors into treacherous seas
for the most desperately ill. All folks with
thank you.
To the volunteers on the frontlines
June 2020 | The Journal of Healthcare Contracting
CALENDAR
Due to COVID-19 restrictions at press time some dates and locations may change.
Calendar of events Association for Health Care Resource & Materials Management (AHRMM) AHRMM20 Conference and Exhibition September 2020 Virtual Event (more to come)
Premier Breakthroughs Conference June 15-18, 2021 Washington, DC
Federation of American Hospitals 2021 FAH Conference and Business Exposition March 7-9, 2021 Washington Hilton Hotel Washington, DC
Share Moving Media National Accounts Summit November 4-5, 2020 Atlanta, GA
Health Connect Partners Fall ’20 Hospital Supply Chain Conference September 30 - October 2, 2020 Kansas City, MO
Consolidated Service Center Forum November 3, 2020 Atlanta, GA IDN Insights East December 9-10, 2020 Philadelphia, PA
IDN Summit Fall IDN Summit & Reverse Expo August 24-26, 2020 JW Marriott Desert Ridge Resort and Spa Phoenix, AZ Spring IDN Summit & Reverse Expo April 12-14, 2021 Omni Orlando Resort at ChampionsGate Orlando, FL
SEND ALL UPCOMING EVENTS TO DANIEL BEAIRD, MANAGING EDITOR: DBEAIRD@SHAREMOVINGMEDIA.COM
The Journal of Healthcare Contracting | June 2020
45
NEWS
Contracting News & Notes Recent headlines and trends to keep an eye on
Piedmont Atlanta Hospital opened tower four months early for coronavirus
hospitals the telehealth resource centers
wrote Congress this week asking for fa-
nearly $165 million to combat COV-
cilities and providers responding in good
ID-19. Funds will go to 1,779 small rural
faith to be shielded from unwarranted
Piedmont Atlanta Hospital’s Marcus
hospitals and 14 HRSA-funded telehealth
liability during the pandemic. Not every
Tower is opening four months early,
resource centers. The funds target smaller,
state has acted on executive orders or
on April 13, to help treat the surge
rural hospitals and is separate from the
enacted legislation to support their health-
of coronavirus patients expected this
CARES Act. Approximately $30 billion in
care facilities and professionals, so these
month. The early opening will add three
the CARES Act was recently distributed
organizations are asking for a federal
ICU and acute nursing units to Atlanta’s
to hospitals nationwide.
legislative approach to ensure a consistent
capacity. It will add 132 beds, with 64
level of protection is available for every
designated as critically needed ICU beds.
facility and provider. The organizations representing these hospitals and health
Aug. 1 but accelerated its work schedule
AHA says hospitals stand to lose $200B by end of June
and deliveries of equipment to make it
The American Hospital Association
possible to open early.
(AHA) has released a report stating that
ʯ America’s Essential Hospitals ʯ American Hospital Association ʯ Association of American
The 16-story tower was set to open on
systems include:
America’s hospitals and health systems stand to lose $202.6 billion by the end of
Hospitals receive $30B in CARES Act by direct deposit
June, during the four-month period of the
CMS has announced the release of $30
port attempts to quantify the effects of the
billion of the $100 billion earmarked for
outbreak over the short-term, including:
hospitals in the CARES Act. The money is separate from the $34 billion in advance payment loans to providers announced last week. CMS later increased the amount in the Accelerated and Advance Payment Program (AAPP) to $51 billion. The CARES Act funds began being distributed via direct deposit on April 10.
coronavirus outbreak in the U.S. The re-
ʯ The effect of COVID-19 hospitalizations on hospital costs
ʯ The effect of cancelled and forgone services, caused by COVID-19, on
Medical Colleges
ʯ Catholic Health Association of the United States
ʯ Children’s Hospital Association ʯ Federation of American Hospitals ʯ National Association for Behavioral Healthcare
ʯ Premier Healthcare Alliance ʯ Vizient, Inc.
hospital revenue
ʯ The additional costs associated with purchasing needed PPE
ʯ The costs of the additional support
Premier, America’s Physician Groups recommend APMs for CMS
All facilities and providers that received
some hospitals are providing to
Premier Inc. (Charlotte, NC) and
Medicare fee-for-service reimbursements
their workers.
America’s Physician Groups have recommended ways CMS can provide
in 2019 are eligible for the distribution.
alternative payment models (APMs)
46
for financial stability during the CO-
HHS awards close to $165M to rural hospitals, telehealth centers
Groups representing America’s hospitals, health systems seek liability protection
HHS, through the Health Resources and
Multiple organizations representing
urged CMS Administrator Seema
Services Administration, is awarding rural
America’s hospitals and health systems
Verma to:
VID-19 pandemic and also preserve the future of the models. The groups
June 2020 | The Journal of Healthcare Contracting
ʯ Allow organizations in APMs to move to no downside financial
FAIR Health: Impact of COVID-19 on hospitals, health systems
CMS offers some financial shelter to Medicare ACOs
risk with modified upside risk,
FAIR Health, a national, independent
After nearly three-fifths of Medicare
recognizing that losing the
nonprofit organization, has shared findings
ACOs indicated they would drop out
opportunity to achieve full shared
on COVID-19 in its health brief, Illuminat-
without more help pertaining to CO-
savings would only compound
ing the Impact of COVID-19 on Hospitals
VID-19, CMS offered some financial
the financial hardships they are
and Health Systems: A Comparative Study of
shelter. An interim rule on April 30
experiencing due to COVID-19
Revenue and Utilization. Findings include:
requirements during the public health
ʯ Implement extreme and
ʯ In general, there was an association
emergency for participants in the Medi-
uncontrollable circumstances
between larger hospital size and
care Shared Savings Program (MSSP),
models across all CMS Innovation
greater impact from COVID-19.
in which 517 organizations treat more
Center models, allowing model
Nationally, in large facilities (over 250
than 11 million beneficiaries. These
participants to maintain their
beds), average per-facility revenues
changes may affect the 160 ACOs
current status
based on estimated in-network
that have agreements ending Dec. 31.
amounts declined from $4.5 million
They include:
ʯ Provide an opportunity for entities to enter the Medicare Shared Savings
in the first quarter of 2019 to $4.2
Program and Direct Contracting for
million in the first quarter of 2020.
a Jan. 1, 2021, start date
The gap was less pronounced in
ʯ Accelerate pending payments to healthcare providers
ʯ Clarify quality mitigation approaches and expand these to other models
ʯ Allow all ACOs 90 days to determine
mid-size facilities (101 to 250 beds) and not evident in small facilities (100 beds or fewer).
ʯ March was the month when
ʯ Removing spending associated with COVID-19 patients from ACO performance calculations
ʯ Allowing ACOs with agreements that expire Dec. 31, 2020, to extend their agreement period by one year
ʯ Giving ACOs in the MSSP’s BASIC
COVID-19 had its greatest impact in
track the option to maintain their
if they want to drop out of the
the first quarter of 2020. Nationally,
current level of participation for 2021
program without penalty
in that month, in mid-size facilities,
Coronavirus diagnoses dropped by half for Boston Hospital staff after mask requirement
ʯ Adjusting program calculations to
the decrease in average per-facility
mitigate the impact of COVID-19
revenues based on estimates in-
on ACOs
network amounts in 2020 from 2019 was 4%; in large facilities, 5%.
ʯ Facilities in the Northeast
ʯ Expanding the definition of primary care services – used to determine beneficiary assignment – to include
After Brigham and Women’s Hospital
experienced a greater impact from
(Boston, MA) began requiring that nearly
COVID-19 than those in the nation
everyone in the hospital wear masks, new
as a whole. For example, in the
An April survey by the National Associa-
coronavirus infections diagnosed in its
Northeast, the decline in average per-
tion of ACOs (NAACOS) found 56%
staffers dropped by half or more. The
facility revenues based on estimated
were at least somewhat likely to leave the
hospital mandated masks for all health-
in-network amounts in March 2020
program if CMS did not take additional
care staffers on March 25 and extended
from March 2019 was 5% for mid-
steps to insulate them from the adverse
the requirement to patients on April 6.
size facilities, 9% for large ones.
financial effects of the pandemic.
The Journal of Healthcare Contracting | June 2020
telehealth codes
47
EDITOR’S NOTE
Graham Garrison
No time to delay In a spring press briefing for local and national media, Warner Thomas, president and CEO of Ochsner Health echoed a concern that many hospital and health system leaders no doubt shared. It wasn’t about COVID-19. It was the residual effect of what COVID-19 has done to public health in the United States – namely, the delay of medical care. Many people with medical issues were fearful to leave their house. “That has significant implications,” said Thomas. “We’ve heard of people who have had strokes who delayed care out of fear. Minor heart attacks as delayed care. People with broken hips that have delayed care for multiple days. That is not a good situation.” At Piedmont Hospital’s ER in Atlanta, Georgia, on some days Allocation from there were more physicians than traditional suppliers patients, according to the Atlanta and sourcing from Journal-Constitution. Patients needing medical care for things unrenew ones are part lated to COVID-19 were afraid of the new normal. to go to the hospital or physiThere is no way cian’s office for treatment. “You’re thinking, where are around the current challenges, according all of the patients?” Dr. Sean told the AJC. “Where are to supply chain Sue the patients having heart attacks, leaders JHC spoke to strokes, diabetic ketoacidosis?” amid the pandemic. Indeed, the coming weeks and months will resemble a balancing act of preparedness and vigilance for COVID-19 cases, with an urgency in ramping back up normal care and elective surgeries that had been put off due to the pandemic. Testing for COVID-19 will be key. Hospitals and health systems are making testing a routine part of the screening process for patients and employees, not just for the ER, but nearly every place where care is delivered. “If you come into one of our facilities you are going to be tested, whether you come in to be
48
admitted, or have a procedure,” said Dr. Robert Hart, chief medical officer, Ochsner Health. To ensure patients can have elective surgeries as soon as safely possible, a roadmap to guide readiness, prioritization and scheduling was developed by the American College of Surgeons (ACS), American Society of Anesthesiologists (ASA), Association of periOperative Registered Nurses (AORN) and American Hospital Association (AHA). The groups joined the Centers for Medicare and Medicaid Services (CMS) and praised their thoughtful tiered approach to postponing elective procedures, ranging from cancer biopsies to joint replacements that could wait without putting patients at risk. Readiness for resuming these procedures will vary by geographic location depending on local COVID-19 activity and response resources. A joint statement, developed by ACS, ASA, AORN and AHA, provided key principles and considerations to guide health care professionals and organizations regarding when and how to do so safely. Meanwhile, supply chain leaders will have to continue to navigate possible product disruptions. Allocation from traditional suppliers and sourcing from new ones are part of the new normal. There is no way around the current challenges, according to supply chain leaders JHC spoke to amid the pandemic. Only through. “You’re going to have to really sort through it,” said Ed Hardin, vice president, supply chain, Froedtert Health. “Roll up your sleeves and vet these guys.”
June 2020 | The Journal of Healthcare Contracting
Patient positioning can make all the difference for consistent BP measurements. We know you realize the importance of blood pressure capture, the effects it can have on diagnosis and the impact to patients. However, following AHA/AMA recommendations for patient positioning during BP capture will help ensure more consistent, accurate and repeatable BP measurements. Something as simple as the patient’s feet not resting flat on the floor can increase the measurement by 5 to 15 points.1
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1
https://www.ncbi.nlm.nih.gov/pubmed/10450120
Š 2020 Midmark Corporation, Miamisburg, Ohio USA
Thank You. To the devoted caregivers on the front lines, and all those who sustain them, we send our heartfelt gratitude.
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