Why Not Make the Savings Game Easier?
“Contracting and pricing strategies can only do so much. At some point, these products are in the hands of the customers and that is where the next major savings are going to come from by fine tuning your existing contracts, eliminating waste, misuse, inefficiencies, and feature rich products.”
Robert T. Yokl, CEO & Chief Value Strategist for SVAH Solutions
Robert T. Yokl
All rights reserved. Reproduction, translation, or usage of any part of this work beyond that permitted by Section 107 or 108 of the 1976 United States Copyright Act without permission of the copyright owner is unlawful. For permission, call, fax, or e-mail Robert
From the Publisher's Desk
It’s Important to Figure Out Which Way the Wind is Blowing
Robert T. Yokl, President/CEO, SVAH Solutions
This may sound cliché, but “figuring out which way the wind is blowing” is an important aspect of supply chain and value analysis in this day of contracting maturity in our healthcare world. What I mean by this is that you are doing well on a good number of your product and service categories but need help ASAP on others. The problem here is that other than spend reports that don’t accurately gauge where you stand on any category because they are not patient volume centric, there really is nothing that can tell you which way the wind is blowing on your product and service categories.
Why is Knowing Which Way the Wind is Blowing So Important?
If I am sitting in a Supply Chain Leader’s chair right now, I would feel good about my contracting as we know we are doing the best given the market conditions and are starting to see GPOs chip away at savings again. The challenge is that the savings are still not as big as what we saw five to ten years ago. You are highly aware of your situation as it relates to pricing and tier levels, which is good, but it does not tell you where you actually stand on any product or service category. Gut feel just does not cut it in this hyper data rich world. We must verify what we think is happening as well as uncover what we don’t know is happening.
How Do You See What You Previously Couldn’t See?
With the wealth of experience and know-how of Supply Chain Leaders today, it is almost preposterous for me to say that there are big dollars that you can achieve in savings that you just don’t know about. Plus, there are major percentage needle moving opportunities that have been hidden from your view. How can this be? You don’t have any type of reporting systems or KPIs/benchmarks to tell you where you stand on Cost Per Adjusted Patient Day on IV sets, Average Cost Per Implantable Defibrillator, on out to wound care dressings and everything in-between. It’ s the same for your purchased services which in some cases are even bigger savings categories like Biomed, Laundry Linen Processing, Reference Lab, and many more that have savings beyond contract price. You can’t do anything about these with a hope and a prayer. You need to have solid proof that you need to investigate these further with your contracting or VA Teams.
The First Step in a 12-Step Program Is…
The first step in a 12-step program, or any program, is to have the individual realize that they have a
Robert T. Yokl
From the Publishers’s Desk
Robert T. Yokl
problem and admit it. (I’m tongue-in-cheek here but the point is real.) That is really the challenge with our “price only” world in the healthcare supply chain. Eighty-five percent of Supply Chain Leaders believe that savings are going to come from the almighty price. Keep in mind though, the most you can save on any product or service category currently would be 10% to 25% but things you have on GPO contract or that you have been contracting on forever may even be holding the line on pricing at 5% to 10% on that same category. Think about looking beyond contract price and look at the total spend of a category such as IV Set Cost Per Adjusted Patient Day. This will reveal much more than you think.
Price is Not Everything
I have signed non-disclosure agreement after non-disclosure agreement with clients, GPOs, and alike that states that we are not going to reveal their prices or publish their prices anywhere. I have no problem signing off on these because we do nothing with price except include it back for our clients to see when they drill into savings opportunity reporting. So, what does this mean to you? Because you are not limited to tiered pricing when you work beyond price, you can delve into areas like departments that are specifying feature-rich products that cost 52% more than what their peers are using. Take, for example, a nursing department using a feature-rich product. I am not going to pick on the specific product or vendor by naming it, but it is something used every day at health systems. One hospital thought that by letting nursing choose this product and by getting a rebate back on it that it would solve all their problems. They had no idea their costs were running high. They thought with the rebate they were doing fine but overall, their costs were running too high. This is just one product category that was used house wide.
Does 5% to 15% in Additional Savings Beyond Price Get Your Attention?
The real point of this article is to highlight to you as a Supply Chain and/or Value Analysis Leader that we are leaving major dollars on the table because you don’t know what you should know with regards to the overall health of every one of your 2,000+ major and minor product/purchased service categories. Imagine if you knew everything - you could be unstoppable further driving costs down and aiding your organization’s bottom line which becomes more challenging every year. It is time that you engage in a savings beyond price initiative to drive out feature-rich product/service elements while eliminating waste and inefficient use of these products and services. You will reap a major win for you and your Supply/Value Chain Team while achieving savings you never thought were possible before.
Steps to Start Your Own Savings Beyond Price Program
• Sell Your Bosses on this Concept
• Put Reporting in Place to Marry Your PO/AP Histories with Patient Volume Centric Measures/KPIs
• Have Your People Trained to Find the Next Level of Savings Beyond Price - It Is Different
From the Managing Editor’s Desk
Keep the Faith
Robert W. Yokl, Sr. VP, Supply Chain & Value Analysis SVAH Solutions
Avoiding the Grind of the Supply/Value Chain World
There are a lot of challenging things going on in the supply chain and value analysis world inside and outside our organizations that affect us in many ways. Many things have positive impacts, but others become more difficult to deal with on an ongoing basis. Let’s face it, our world is not always the glamorous environment that we would like it to be. Supply/value chain is really about a lot of good old-fashioned tough work every day. There are vendors trying to circumvent your processes, doctors running to the CEO to get what they want, or even those that don’t believe in your processes or are just plain difficult altogether. It can be a grind.
The good news is that we are moving the needle on supply/value chain every day. It may not seem to be readily apparent, but the needle is moving. Nothing seems to move as fast as we want it to but that is okay. I am here to encourage you to keep the faith. We are moving forward no matter what comes at us. We got this!
From the Managing Editor’s Desk
Robert W. Yokl
You just need to keep pushing the envelope to move your supply/value chain program forward in a positive way. And yes, some days will be the grind where we have dug ourselves into a big ditch of work that we need to climb out of, but we always seem to make it out okay.
Below are just a few ideas for you when you feel like you are burning out or feeling the grind from your supply/value chain duties:
Learn Something New
The only way to move your program and your mindset forward in a positive way would be to learn new things to add to your skill set. Yes, taking a class or webinar may seem like more work but it really isn’t because it is reenergizing your brain to new capabilities that will make your job easier and more efficient. Make a list of the things you want to learn about and schedule some time to make it happen. It is invigorating when you learn something new.
Schedule a Walk-Around VA Review
We are all often stuck behind a desk and find that we are not out where the value is being performed which limits our view of what is actually going on in our healthcare environment. Getting out from behind the desk and viewing the product you are reviewing in the clinical departments (or even nonclinical) is a great break from getting stuck behind a desk. Plus, you will gain valuable insights into the products you are reviewing. I like walking through the storeroom whenever I am invited by clients as there is a goldmine of ideas when you view the products on the shelves.
Take a Step Back and Review/Promote Your Successes
Don’t be afraid to promote your successes. Most don’t, but you should. If you think your leaders in your organization are aware of all your successes, think again. They might know about one or two things going on, but rarely do they know about them in detail. Value analysis teams are formed and do a lot of work in order to keep costs and quality in check, and nobody is getting paid any more to do this. So promote your successes, especially when you have a big win or come off a big fiscal year in which you have met all of your senior leadership’s goals and celebrate the wins with your team. This makes your value analysis job more valuable for you and refreshes your VA team members as you roll into the next year.
These are just a few ideas for when you and your team are feeling the pinch of the everyday pressures of the supply/value chain world. Supply chain/VA professionals are tough cookies to say the least, but that does not mean that you don’t need to be motivated and encouraged from time to time. We are all human and let’s face it, the most important element to any supply/value chain organization is the leaders and team members. Keep the faith my fellow supply chain/value analysis professionals!
STAY CONNECTED HERE
The Intersection of Healthcare Value Analysis
J. Hudson Garrett Jr., Ph.D., MSN, MPH, MBA, FNP BC, PLNC, VA-BC, BC-MSLcert , CMRP, CPXP, CDIPC, FACDONA, FAAPM, eFACHDM, FNAP, FACHE, FAPIC, FSHEA, FIDSA, FAHVAP
In the ever-evolving landscape of healthcare, the integration of evidence based practice (EBP) into the healthcare value analysis process is pivotal. EBP involves the conscientious use of current best evidence in making decisions about patient care, combining clinical expertise, patient values, and the best available research. Incorporating EBP into healthcare value analysis ensures that clinical decisions are grounded in solid scientific data, ultimately advancing patient care and optimizing resource utilization. EBP is a cultural commitment of a healthcare organization towards using data-driven approaches to improving quality and competent care. This also requires engagement from clinicians, healthcare leaders, and industry partners in parallel to advance this critical mission.
The Significance of Evidence-Based Practice
Evidence-based practice is essential for several reasons:
Featured Article Garrett and Niven
1. Improved Patient Outcomes: By basing clinical decisions on the most reliable evidence, healthcare providers can enhance patient outcomes. Treatments and interventions supported by high-quality evidence are more likely to be effective and safe.
2. Cost-Effectiveness: EBP helps identify the most efficient and cost-effective treatments, reducing unnecessary spending on ineffective or harmful interventions. This is critical in an era of rising healthcare costs.
3. Standardization of Care: Implementing EBP promotes standardization across healthcare settings, reducing variability in care delivery and ensuring that all patients receive the best possible care based on current research.
4. Patient Satisfaction: Patients are more likely to trust and adhere to treatment plans that are backed by scientific evidence, leading to higher satisfaction and better overall health outcomes.
Levels of Scientific Evidence
Understanding the different levels of scientific evidence is crucial for effectively incorporating EBP into the healthcare value analysis process. These levels, often depicted in a hierarchy, help determine the strength and reliability of the evidence.
Level I: Systematic Reviews and Meta-Analyses of Randomized Controlled Trials (RCTs)
• These provide the highest level of evidence as they synthesize data from multiple RCTs, offering comprehensive insights into the effectiveness of interventions.
• Example: A meta-analysis of multiple RCTs on the efficacy of a new drug for treating hypertension.
Level II: Randomized Controlled Trials (RCTs)
• RCTs are considered the gold standard for testing the efficacy of interventions due to their rigorous design, which minimizes bias.
• Example: An RCT comparing the outcomes of two different surgical techniques for knee replacement.
Level III: Controlled Cohort Studies
• These studies follow groups of patients over time and compare outcomes between those who received the intervention and those who did not.
• Example: A cohort study examining the long-term effects of a dietary intervention on diabetes management.
Featured Article Garrett and Niven
Level IV: Case-Control Studies
• These studies compare patients with a particular condition (cases) to those without the condition (controls), looking back retrospectively to identify possible causes or risk factors.
• Example: A case-control study investigating the association between smoking and lung cancer.
Level V: Case Series and Case Reports
• These involve detailed reports on a single patient or a small group of patients, providing insights but with a lower level of evidence due to lack of control groups.
• Example: A case series describing the outcomes of patients treated with a new type of wound dressing.
Level VI: Expert Opinion
• Expert opinion is the lowest level of evidence, relying on the clinical expertise and experience of healthcare professionals.
• Example: Clinical guidelines developed based on expert consensus when higher levels of evidence are lacking.
Featured Article Garrett and Niven
Leveraging Evidence-Based Practice in Healthcare Value Analysis
Integrating EBP into the healthcare value analysis process involves several steps:
1. Literature Review and Evidence Gathering
• Conduct comprehensive literature reviews to gather the best available evidence related to the healthcare products, technologies, or interventions under consideration.
• Utilize databases such as PubMed, Cochrane Library, and Embase to access high-quality research studies and systematic reviews.
2. Critical Appraisal
• Critically appraise the gathered evidence to assess its validity, reliability, and applicability to the specific healthcare context. Tools like the Critical Appraisal Skills Programmed (CASP) checklists can assist in this process.
• Evaluate the methodology, sample size, and potential biases in the studies to ensure robust decision-making.
“Combine the appraised evidence with clinical expertise and patient preferences to make informed decisions. This holistic approach ensures that the chosen interventions align with the clinical context and individual patient needs.”
3. Integration with Clinical Expertise and Patient Preferences
• Combine the appraised evidence with clinical expertise and patient preferences to make informed decisions. This holistic approach ensures that the chosen interventions align with the clinical context and individual patient needs.
• Engage multidisciplinary teams, including clinicians, nurses, and pharmacists, in the decisionmaking process to incorporate diverse perspectives.
4. Implementation and Monitoring
• Implement the selected interventions and monitor their outcomes continuously. Use performance metrics and patient feedback to assess the effectiveness of the interventions and make necessary adjustments.
• Foster a culture of continuous learning and improvement, encouraging healthcare teams to stay updated with the latest research and integrate new evidence into practice.
Featured Article Garrett and Niven
5. Education and Training
• Provide ongoing education and training to healthcare professionals on EBP principles and techniques. This can include workshops, seminars, and online courses.
• Equip healthcare teams with the skills to critically appraise research and apply evidence in their clinical practice.
Incorporating evidence-based practice into the healthcare value analysis process is essential for advancing patient care, improving outcomes, and optimizing resource utilization. By understanding the different levels of scientific evidence and leveraging them effectively, healthcare organizations can make informed decisions that enhance the quality and efficiency of care delivery. Embracing EBP not only benefits patients but also empowers healthcare professionals to provide the best possible care based on the most reliable evidence available. As the healthcare landscape continues to evolve, the commitment to evidence-based practice will remain a cornerstone of high-quality, patient-centered care.
Dr. Garrett is the Executive Director and Executive Vice President for the Association of Healthcare Value Analysis Professionals (AHVAP) and an Adjunct Assistant Professor of Medicine in the Division of Infectious Diseases at the University of Louisville School of Medicine.
Karen Niven is the Senior Director of Clinical Value Analysis at Premier, Inc. and serves as the President-Elect for the Association of Healthcare Value Analysis Professionals (AHVAP).
Duvera Solutions Group
Clinical Value Analysis
How Do You Know Which Supply Categories Are at Best Practice Levels and Which Are Not?
Anne Marie Orlando, RN, MBA, RCIS, CVAHP, Senior Director, Clinical Programs at Blue.Point Supply Chain Solutions; Treasurer, Association of Healthcare Value Analysis Professionals
Maintaining best practice levels in supply categories in the complex healthcare landscape is crucial for delivering high-quality patient care while optimizing costs. To this end, value analysis is pivotal in ensuring that the supplies used in your facility are both cost-effective and in alignment with best practices. Here’s how you can determine which supply categories meet best practice standards and which need improvement.
The first step in evaluating supply categories is to gather and analyze data. This data-driven assessment is important in objectively determining each supply category's efficiency, costeffectiveness, and clinical impact. There are a few ways to accomplish this evaluation. Benchmarking compares your facility’s supply usage and costs against industry standards and peer institutions. Use national databases and benchmarking tools to identify where your facility stands. A utilization review serves to analyze usage patterns to identify variations and outliers. Look for trends in supply usage that may indicate inefficiencies or overuse. Finally, a cost analysis can determine the total cost of ownership for each supply category, including acquisition, maintenance, and disposal costs.
Once the data points are gathered, the next step is correlating accompanying clinical outcomes. Each supply category should contribute to positive clinical outcomes. Begin by evaluating available outcome metrics associated with specific supply categories such as CAUTI (catheter-associated urinary tract infection) rates, CRBSI (catheter-related bloodstream infection) rates, SSI (surgical site infection) rates, etc. Quality and/or Risk Management will be able to provide these data points if access to this information is an issue. When a metric is outside of the expected outcomes, perform a complete product tracer from patient admission to discharge. Review all associated products, practices, education, order sets, clinical pathways, and clinical staff touchpoints. Ensure each of these steps is supported by clinical evidence and guidelines. Use internal resources and guidelines from professional organizations to validate efficacy.
Armed with category and outcome data, stakeholder engagement is next. Gather feedback from clinicians, including doctors, nurses, and other healthcare professionals who use the supplies daily. Their insights are invaluable in assessing the practical efficacy and usability of the products. Address any educational needs with ongoing education and training for staff on the latest best practices and supply usage guidelines. Work with supply chain to understand each supply category's logistics, availability, and industry partner performance. If you are not discussing quality and outcomes as part of your QBRs (quarterly business reviews), ensure these topics are on the agenda to ensure they
Clinical Value Analysis
meet their contractual obligations and deliver high-quality products. Consider patient feedback and experiences, especially for supplies that directly impact patient care and comfort.
Finally, value analysis professionals must perform their due diligence in ensuring that each product (even technologies and services) maintains regulatory compliance and standards. Verify that supplies have necessary certifications and comply with regulations from bodies such as the FDA, ISO, or other relevant authorities. Verify for adherence to safety and quality standards, such as ANSI/AAMI or ASTM.
Determining which supply categories are at best practice levels and which are not requires a multifaceted approach. By leveraging data, correlating clinical outcomes, engaging stakeholders, and ensuring regulatory compliance, value analysis teams can ensure that clinical supplies are both costeffective and aligned with the highest standards of patient care. Diligence in these areas is key to maintaining a highperforming, patient-centered, and fiscally responsible healthcare environment.
Anne Marie Orlando, RN, MBA, RCIS, CVAHP, Senior Director, Clinical Programs at Blue.Point Supply Chain Solutions; Treasurer, Association of Healthcare Value Analysis Professionals
Anne Marie has been a critical care nurse for over 19 years with a leadership foundation in the Interventional Cardiology and Interventional Radiology space. During her supply chain tenure, Anne Marie held a dual role of Supply Chain and Clinical Resource Director where she operationalized many clinical initiatives while maintaining fiscal accountability. At the GPO level, Anne Marie served as the Director of Clinical Services for Yankee Alliance supporting member value analysis teams and their work with clinical utilization. Anne Marie is currently the Senior Director, Clinical Programs for Blue.Point Supply Chain Solutions supporting value analysis teams in the use of the Blue.Point platform focusing on aligning product utilization and standardization with evidence-based practice.
Leading the Way to Value Analysis Success!
Terri Nelson, BSN, RN, MA, Emeriti Staff Mayo Clinic
HVAUMM: Could you share with us a little bit of your background before your value analysis career and then how you got into VA?
T. Nelson: The first half of my healthcare career was as a nurse in acute care which included staff nurse and as a nurse manager of the Medical Oncology unit for 12 years. After completing my master’s in healthcare administration, I was interested in exploring opportunities outside of the acute care area. In 2002, Mayo posted for a Director of Value Analysis. This was a new role with a focus on cost containment, promoting product standardization and utilization. This position would be reporting to the Director of Supply Chain Management, not clinical leaders. I met the position criteria of clinical background, management experience, presentation skills, organized, and experience with medical products and suppliers. At this time, suppliers had limited
restrictions and usually met with nurses. I Googled, “What is value analysis?” The information was very limited and what I found centered around process improvement, efficiencies, and outcome measurements. I had nothing to lose so I applied and fortunately was offered the position. Then the work began. I was a team of one who needed to define what value analysis was at the Mayo Clinic, how it fit within Supply Chain, how to decrease supply cost, increase contract compliance, develop processes and procedures, and most importantly, obtain clinical staff support.
HVAUMM: What are some important aspects of healthcare supply chain and value analysis that you experienced through the years? What made your Mayo Value Analysis Program successful?
T. Nelson: Important aspects of developing a successful VA program:
1. Understand the culture of the organization and develop programs which fit this culture. Mayo Clinic is a physician led organization with decisions supported by committees, so a Value Analysis Committee was formed which was chaired by a physician leader and membership represented clinical areas.
2. Define what value analysis is for the organization. We defined VA as: The Value Analysis process is objective, data driven, andseparates clinical/technical difference from
VA Leadership Interview
personal preference. Value analysis is the process used to evaluate products based on clinical efficacy, safety, and cost. Value analysis promotes product standardization, decreasing duplication of products AND utilization, using products in the most efficient manner; the right productfortherightneed.
3. Don’t take it personally, not everyone will like the decisions. Identify what the value analysis steps are and use them for every product/ contract review. We used a 5-step process: Initiative, Date, Review & Recommendation, Implementation, and Compliance. One example was the “sippy cup” request. Within the first three months of starting value analysis, a nurse requested a new sippy cup for the pediatric unit. It was low spend with limited uses, so why not just let them order one? I wanted to develop a relationship with this clinical leader and to test our process steps. It cost more to do the product review than the savings generated, but the trust that was developed was priceless. Another product review early in the formation of our program was exam gloves. We had used the same exam gloves for at least 15 years. It was the only glove I had used. Now we were looking at changing, and staff were resistant to any change. It was important to identify the stakeholders and decision makers. We also made sure we reinforced our value proposition. Value = Quality (Safety, Service, & Outcomes)/Cost. Cost is not the driver, but if everything is equal it does influence the final decision. By following the structure, we had established that we were able to convert to an equal glove with a cost savings of 30%.
HVAUMM: How does one become a leader like yourself in a large system as well as in
Terri Nelson
the value analysis community with all the fine work you have done and are doing with AHVAP?
“I’m a nurse who has always practiced with a focus on the needs of the patient. I also believe that multiple voices and insights can improve the decisions we make as healthcare providers.”
T. Nelson: This is an interesting question. I’ m a nurse who has always practiced with a focus on the needs of the patient. I also believe that multiple voices and insights can improve the decisions we make as healthcare providers. Value analysis professionals need to always be questioning why we do what we do and how these actions improve patient care. I also encourage volunteering to test or provide insight into new or current products. Most importantly, be innovative, think outside the box, and your role needs to be relevant to the mission of the organization. Having worked with suppliers, they have heard me say, “I will never lie to you because I won’t be able to remember the lie.” What I mean is the only way either of us can be successful is if we trust and have open conversation. I also believe that the answer will always be no if you never ask the question. I spent 22 of my 46 years at Mayo in Supply Chain. I developed a VA work unit which grew and evolved over the years and provided me with many positive experiences. The successes I’ve had were achieved by using the behaviors I listed above.
VA Leadership Interview
HVAUMM: How do you see value analysis professionals bridging the gap beyond just new product requests, rebates, and conversions to dramatically impact clinical excellence/integration and consumption/utilization management?
T. Nelson: Don’t limit the role of VA. It’s not just product requests; think broader. Five years ago, we stepped back and looked at what we did as a work unit and developed three areas of focus. (1) Category Management – Contracts, new product requests. (2) Product Management –Recalls, product disruptions, and quality issues. (3) Operations Support – Product conversions, compliance, products which support quality measures. Once you have defined your scope, now you can identify metrics which support the work of the Value Analysis Team and the value it contributes to the organization.
HVAUMM: Where do you see healthcare value analysis going in the future?
T. Nelson: Value analysis needs to participate in committees that their organizations use to identify future operational needs, such as changes in served patient populations, building
Terri Nelson
expansions, revenue sources, and quality outcomes measurements. Not all of these will have products, but some will, and it gets you exposure. I think of the “Hospital of the Future.” What does this look like? How will it change the way we review and the types of products we use to support patients?
HVAUMM: Value analysis can be a bit of a grind if one lets it be. What are your recommendations to those that fall into a rut (the NPR grind) and need motivation to leap forward with success?
T. Nelson: VA professionals need to remember that the work of value analysis is always putting the need of the patient first. It’s not an easy position. Sometimes you feel caught in the middle of decreasing costs for the organization and clinical staff product requests. Both can be a no-win situation. Value analysis can bridge relationships between the business and clinical sides of the organization, which builds success. Also, value analysis professionals are never alone. Reach out to your VA colleagues at other organizations, ask questions, and develop a network for yourself.
Terri Nelson retired from Mayo Clinic in 2024 after 46 years of service. Ms. Nelson has experience in a variety of roles including Staff Nurse, Nurse Manager, Quality Nurse, Senior Director of Clinical Quality Value Analysis Team (CQVA), and Principal Project Lead for Inspirity
As Senior Director of CQVA she facilitated the Value Analysis process, development of the Product Formulary, and managed the Product Recall/ Issue System. In addition, the Value Analysis Team provides value analysis support to members of Captis a collaborative healthcare network comprised of 90+ members.
In 2022, Ms. Nelson was recognized as one of the top 10 Women in Supply Chain by the Journal of Healthcare Contracting. Terri has been a member of the Association of Healthcare Value Analysis Professionals, serving as the Central Region Director. She received her Bachelor of Science in Nursing from Winona State University, and master’s degree with a dual focus in Health and Human Service Administration and Management from St. Mary’s University.
Vendor Spotlight
Solving Sourcing Problems and Saving Big
Jonathan Jarashow, CEO and Chief Supply Chain Officer, OmniChannel Health
At last month’s Ohio AHRMM conference, I had the pleasure of speaking right after a representative from Henry Schein Medical. I noticed striking similarities between myself and the founder, Henry Schein:
• Both of us come from families of Eastern European Jewish immigrants in New York and attended Ivy League schools.
• Henry started his journey in the medical supply industry by opening a pharmacy after graduating from Columbia University. Similarly, shortly after graduating from Harvard, I partnered with leading pharmacies to publish the nation’s largest diabetes magazine.
• Today, both our companies sell medical and surgical products to hospitals.
But the similarities end there! Henry Schein is a Fortune 500 company, while Omnichannel Health is an SBA-certified small business. The benefit of this is that our small size keeps us nimble and allows us to stay laser-focused on helping supply disruption teams source the original/OEM products they need for their patients, avoiding the headaches of substitutes all without any cost or commitment.
Vendor Spotlight
Our Journey and Expertise
In 1995, I founded what would become the nation’s largest diabetes magazine. For two decades, we distributed over 100 million copies through major pharmacy chains such as Walgreens, Walmart, CVS, and Costco, as well as other top retailers and diabetes centers in hospitals nationwide. The relationships we built with hospital leadership during this time were invaluable. When the print magazine industry went the way of the Kodak camera, we pivoted to address the sourcing needs of hospitals, leading to the creation of Omnichannel Health.
Why Choose Alternative Sourcing?
Omnichannel Health prides itself on being a trusted, reliable, and AHRMM-vetted secondary distributor. As a new AHRMM Supply Chain Resource Council member, we step in when primary distributors and suppliers can't meet a hospital's urgent needs.
“We step in when primary distributors and suppliers can’t meet a hospital’s urgent needs.”
You already have a capable supply disruption support team, so why consider working with us? Because we make even the best support teams better at no cost or commitment.
Our Expert Supply Disruption Support Team:
• Specializes in finding hard-to-source, original/OEM medical & surgical products.
• Helps you avoid the headaches of settling for substitutes.
• Co-navigates disruptions due to backorder restrictions, allocation challenges, and discontinued items.
• Handles the legwork, reducing your team's time chasing backorders and allowing them to focus on other essential tasks.
• Leverages our extensive network of distributors and suppliers.
• Significantly increases your chances of getting the exact products your patients need.
Making a Significant Impact
Another area where we have made a significant impact is with surgical stapler reloads, both robotic and regular. In today’s demanding healthcare environment, hospitals are under immense pressure to reduce costs while maintaining high standards of care. These products are indispensable in countless hospitals and surgery centers nationwide, with surgeons often having specific preferences for
Vendor Spotlight
Jonathan Jarashow
different versions. These products’ supply and demand dynamics can drive prices down, creating opportunities for substantial savings. By leveraging our extensive network of distributors and suppliers, we save hospitals and health systems 33-50% on surgical products.
Trusted Partnerships and Significant Savings
We offer products from leading manufacturers such as Covidien and Ethicon. Depending on your contractual agreements, our prices often surpass those available through GPOs. For Intuitive products, GPO discounted pricing is typically not an option. However, we also save hospitals and health systems 33-50% on da Vinci reloads, guaranteeing that our pricing is lower than any competitor’ s.
Omnichannel Health ensures your hospital’ s supply chain remains robust and efficient, enhancing your supply disruption team’ s capabilities to new heights.
“By leveraging our unique and extensive network of distributors and suppliers, we save hospitals and health systems 33% to 50% on surgical products.”
Jonathan Jarashow, CEO and Chief Supply Chain Officer, OmniChannel Health
In 1995, I founded what would become the nation’s largest diabetes magazine. Over two decades, we published over 100 million copies, distributing them through major pharmacy chains such as Walgreens, Walmart, CVS, and Costco, as well as other leading retailers. Our magazines were also sent to diabetes centers in hospitals nationwide. The connections we built with hospital leadership were invaluable, and when the print magazine industry began to decline, we leveraged these relationships to meet the sourcing needs of hospitals.
We recognized the difficulty hospitals faced in sourcing original/OEM backordered, allocated, and low-stock medical products and supplies, and the headaches caused by having to settle for substitute products. These insights led to the creation of OmniChannel Health.
As an SBA-certified small business, OmniChannel Health prides itself on being small but nimble and highly responsive. We are a trusted, reliable, and AHRMM-vetted secondary distributor that steps in when primary distributors and suppliers can't meet hospitals' urgent needs.
Utilization & Consumption Management
Dialing It In: Keys to Supply Cost and Quality Optimization
Robert W. Yokl, Sr. VP, Supply Chain & Value Analysis SVAH Solutions
We have been through the ringer with 99% of our contract categories and trying to reduce prices and standardize to gain that next tier percentage discount off what we are buying. This has been going on for the past 20 years. However, savings are just not what they used to be since hospitals and health systems as well as their GPOs have become very mature. Basically, you are doing everything they ask you to do to save money, but the savings aren’t what they used to be, thanks to inflation and market conditions. So, how do we further optimize costs and quality in our contracts to save even more money? We dial it in further!
There Are Still a Lot of Savings to Be Had!
Believe it or not, there are still substantial savings on the table when organizations come to the realization that the next level of savings is not going to have anything to do with changing your contracted vendors or getting a better price. Instead, it is all about dialing your products in within your existing contracts.
Optimizing Feature Rich Products
Most product categories have their share of feature-rich products that were at one point deemed “must haves” by the end users. The more features you have in any medical device category, the more you are going to be paying for. For instance, if a nurse selects a feature-rich product such as a three port PICC line but only requires one port, then that will cost the organization 30% more for those extra port capabilities that they will never use. Or worse, all the nurse carts may only have the three port PICC to choose from and thus your PICC costs are going to be 30% higher across the board when perhaps you may have only needed the three port PICC 10% to 15% of the time. This is only one category to optimize - you have over 750 major categories that this could be happening in.
Realizing that You are Consuming Too Much
In a perfect world, healthcare organizations would only use exactly what they should use in order to optimally take care of patients; no more, no less. However, the reality is that about 73% of all product categories have some form of consumption issue in them. The good news is that about 40% to 50% of the consumption issues are minor and even if we fixed them all, it would not move the
Utilization & Consumption Management
Robert W. Yokl
needle savings wise. What we are looking for are the 23% to 33% that are really out of line, some of which are going to be substantial dollars. This will require value analysis assistance to first realize that this is a real issue and then help to mitigate the issue(s) at hand on the over-consumption. You are going to find major dollars here!
Wasting Life Cycle
Every organization has some degree of waste and inefficient use going on with their major and minor product and service categories. If these were all cleaned up, substantial dollars would be added to the bottom line as well as quality improvements with the added focus on reducing waste and inefficient use. Inefficient use does not get talked about enough. Each product has a life cycle cost and if you are not getting all of the use out of a product that was intended in the original value analysis case review, then your costs are going to be too high. For example, say you have a patient with IV tubing and the patient has a four day stay. The IV tubing on that patient should last them the whole 96 hour stay per the manufacturer’s specifications and life cycle. But if your nursing team is changing the IV tubing every 36 hours, you will be using a higher percentage of IV set tubing per patient day. Another example is placing a 48-hour wound care dressing on a patient only to have it changed out in one day because the nurse at the time did not like the look of the dressing. Advanced wound care now requires those 48-hour dressings to stay on for 48 hours, so using too many dressings may show underlying quality issues with patient care. It is not good to expose a wound when you don’t have to.
You Must Know Where You Stand
I saved this one for last because it is probably the most important key that will save you the biggest bucks. Whenever I sit in on a value analysis team meeting for one of our clients and they are discussing a new product request, contract conversion, or VA review, I am on our KPI/utilization reporting to find out where they stand with this product or service category. Why is this important? Because sometimes you don’t know what you don’t know and think that you are doing everything that our industry and your GPO espouses only to find out that there are major dollars on the table. Just recently, we did some benchmarking for a large system and found over $1 million of savings opportunities in just two categories that had everything under the sun going on. They did not realize how much more they were spending than their peers in the industry, to which we helped them understand and shared just how the other organizations were performing so well in these areas. This is not rocket science. It is more “trust but verify.” If you think your cost per adjusted day, surgical case, or cath lab case is good, go that next step and do some peer benchmarking.
You Can Make a Huge Impact on Your Organization’s Bottom Line
The fundamental theme here is that we are not talking about price, standardization, or even changing vendors, but instead are looking for savings beyond price to find the next level of major savings. Plus, it is a lot easier to optimize within an already existing contract framework than it is to go through the time-consuming process and challenges of changing vendors for a questionable outcome.
BREAKTHROUGH GAME CHANGING
BECOME A SAVINGS MAGNET
Read this book and in a few weeks save moremoneythanyouhaveinyears!
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Robert T. Yokl and Robert W. Yokl, healthcare’s leading authorities in Supply Utilization Management, have helped hundreds of hospitals, healthcare systems, and integrated delivery networks to save close to a half billion dollars by employing the same utilization management strategies, tactics, and techniques that theywillteachyouinthisbook.
• Understand why you are slowly but surely running out of price savings
• Learn why utilization management is more important than ever before
• Hear why a new discipline of utilization management is on the horizon
• Review 8 categories of utilization misalignments that cost you money
• Know why value analysis analytics is the new science of savings
• Grasp the worth of the value analysis/utilization management connection
Four Keys to Running Your Organization’s Value Analysis Program
Robert T. Yokl, President/CEO, SVAH Solutions
Everyone wants to run their own Value Analysis Program. It should be a goal for every value analysis professional who aspires to be successful in our field. Now herein lies the challenge, there is more than meets the eye when it comes to running, maintaining, and pushing forward your own Value Analysis Program. The old saying, “If it were easy, everyone would be doing it,” certainly applies.
To run your organization’s VA Program, you will want to keep these four keys to success in mind as you work towards and/or are revamping your approach to how you manage your program.
1. Winging It Doesn’t Work –
If you are going to manage your own Value Analysis Program, you better have a plan for how this is going to work. Surely there will be some sort of foundation already in place from your predecessor, but you will want to shape and form your own plans, goals, and objectives for your program for the short and long term. It is very tough to start with a blank piece of paper when your Value Analysis Program has already been defined and accepted at your organization, so I would recommend your plan start with what is already in place and then make
Value Analysis 101
Robert T. Yokl
small incremental adjustments/improvements that will make it even better. When your boss or a Senior Leader in your organization says to you that your VA program is fine the way it is, you must ignore them as every program needs improvements or they stagnate.
2. Find a Mentor – Everyone needs a coach/mentor to discuss ideas with or to give them advice. Remember the quote from the great UCLA Coach John Wooden, “It’s what you learn after you know it all that counts most!” This coach/mentor could be someone in-house like your Supply Chain Director/VP, or it could be someone outside your organization who has walked in your shoes and is open to being your coach throughout the process.
“It’s what you learn after you know it all that counts most!”
3. Fail Fast Then Learn from It – Value analysis is about experience. Training is important, but you really learn project by project, new product request by new product request, team meeting by team meeting, etc. In the value analysis world, nothing replaces experience, and most importantly, failing from time to time. I have been in the VA world for over 32 years now and the best learning experiences I have had are related to failures in my VA dealings with my clients. Remember, failing at VA is okay. Just pick up the pieces, learn from it, and then move on. Believe me when I tell you, the failures are well worth the valuable learning experience every time.
4. Don’t Get Caught in the Grind – I cannot tell you how many times I have seen VA Program Managers burn out within just one or two years of running their programs. Don’t let this happen to you! First, you have to recognize when the job starts becoming a grind and do something about it before you and your team starts feeling the burn. I had one VA Program Manager tell me that they fielded over 1,600 new product requests the previous year. My first thought was, “They are feeling the burn.” If something like this is happening to you, you need to address the why and what you can do to curtail the amount of new product requests that are coming through the pipeline. It’s like doing a mini value analysis study to figure out what is happening. Then, you could plan some small changes and curtail that number dramatically. Or, you could speak to your boss about the increases and the fact that you need one, two, or even three more people to handle the new product requests.
Let’s face it, running your organization’s Value Analysis Program is pretty cool, and my hat goes off to those who are doing it. Your goal should be to sit in the VA Program Manager’s chair, not just to keep it warm but to make sure that your program doesn’t just continue as it always has but that it thrives. You got this!
Value Analysis Advisor
Why Can’t My Product Get Through the Value Analysis Team?
Mark Copeland, Vice President, Sales, 3T Medical Systems, Inc.
“Why can’t my product get through the value analysis team?” I hear this question a lot from medical device professionals.
I understand the confusion of the Rep or Manager, or even the VP of Sales for these companies. The value analysis process is a relatively new phenomenon in healthcare sales, and most companies haven’t invested in the understanding or training to really succeed and navigate this new process.
But here’s a news flash…It’s not 2014. Sorry, but the era of the Clinical Champion getting a product only he or she wants for his/her practice has gone the way of the Blu-Ray DVD. And 2014 is never coming back.
It’s time for big and small medical device companies alike to think, act, and sell differently.
Oddly, many of the products carried by these medical device companies ARE great values and DO benefit the health system and its patients, but the companies and sales teams are unprepared to present the product in a true value analysis perspective. Here’s why:
Value Analysis Advisor
Traditionally medical device representatives were able to stand in front of decision-makers (clinicians) and speak their language, know their clinical needs, and deliver solutions very effectively.
But times have changed. Clinical input is still highly important and valued, but clinical success is only PART of the overall picture within the health system.
These days, when it comes to new product approvals or new vendors, the value analysis team is the decision-making team for the health system. And value analysis looks at many other factors above and beyond clinical success. Quality, infection prevention, risk management, finance, and yes, COST.
Medical device companies have been slow to accept this value analysis shift. Too often, the medical device company believes the Clinical Champion will carry the product to approval without having done a pro forma, a risk assessment, or even gathering the proper data (DRGs, HCPCS, etc).
The sooner companies recognize the evolution of healthcare sales, the better.
Recognition of the value analysis committee and its needs will not only change medical devices’ “marketing message” but more importantly, alter how a company does product development, clinical research, pricing structure, and much more. There is a lot of money and investment at stake!
So, what should med device companies do differently?
Mark Copeland
Value Analysis Advisor
Here are three things I urge medical device companies to do right now to improve selling into health systems and value analysis committees.
Meet with value analysis team members and learn what MATTERS to health systems. HOW do these systems like to digest new information? What is needed for each new product as part of the due diligence?
Mark Copeland
“Let’s start thinking about how to show the product’s value to the entire health system.”
Learn how the value analysis process works. What does the committee need to see and understand before committing time, effort, and money to explore your new product request?
Finally, ask yourself, “HOW can I show my product’s value to the value analysis team in a way that matters TO THE TEAM?”
If companies do the above three things, they will not only understand how the new healthcare economic landscape stands, but they will also immediately gain MASSIVE competitive advantages over others in their sector.
I expect these forward-looking medical device companies will see a 10-15% increase in topline revenue over 2-3 years and a competitive advantage over competitors of 5-10 years.
So, let’s stop thinking about how to get a new product THROUGH the value analysis committee and start thinking about how to show the product’s value to the entire health system.
Mark Copeland is a 28-year healthcare sales professional with the last 20 spent in startup medical device companies.
His company, 3T Medical Systems Inc, manufactures and sells innovative medical devices to health systems globally, and Mark teaches companies how to present their new product requests in a way that meets the value analysis requirements.
Contact Mark at mcope67@gmail.com for more information, or visit ValueAnalysisExpert.com.
mcope67@gmail.com (717) 579-8144
The Value Curve: Cost vs. Value and Risk Assessment
Tim Ingram, Sr. SME, Supply Chain Management, Paradigm Venture Group
We've all seen the four Value/Cost and Risk graph quadrants. They are used in decision-making to measure the source of truth within Supply Chain Management.
Imagine a graph where the x-axis represents the cost, and the y-axis represents the value. Each point on the graph corresponds to a particular product or service the supply chain offers.
Low Cost, Low Value: Products or services that are inexpensive to produce and offer limited value to the customer would appear in the bottom left quadrant. These are typically commodity items with high competition and low-profit margins.
High Cost, Low Value: Items that are expensive to produce but do not offer corresponding value to the customer would be in the bottom right quadrant. These are often seen as overpriced or inefficient and are not sustainable in a competitive market.
Low Cost, High Value: Products or services that are inexpensive to produce but offer high value to the customer would be in the top left quadrant. These are considered highly efficient and are likely to be market leaders due to their competitive pricing and high perceived value.
High Cost, High Value: Items in the top right quadrant are expensive to produce but also offer high value. These could be premium products or services that justify their higher price with superior quality, brand reputation, or exclusive features.
“I’ve observed firsthand the transformative power of strategic value optimization.”
The optimal balance is often found along the curve where the increase in cost corresponds to a proportional increase in value, known as the value curve. This curve represents the efficient frontier where any additional cost does not bring about a significant increase in value, and any decrease in cost does not significantly reduce the value.
Leveraging the Value Curve for Strategic Healthcare Supply Chain Excellence
In the intricate tapestry of healthcare supply chain management, the value curve emerges as a beacon, guiding us toward a harmonious balance between cost containment and value delivery. As a seasoned professional in this domain, I’ve observed firsthand the transformative power of strategic value optimization.
The value curve is not merely a graphical representation but a narrative that tells the story of efficiency, patient-centricity, and innovation. It charts the course for healthcare providers to navigate the complexities of cost management, while its true power lies in its ability to elevate the standard of care. By understanding and leveraging the value curve, we can truly make a difference in the lives of our patients.
In our relentless pursuit of excellence, we must embrace the value curve as a compass, steering our decisions toward outcomes that resonate with the core values of healthcare: compassion, quality, and accessibility. By meticulously aligning our supply chain strategies with the value curve, we can ensure that every decision we make and every action we take is a step toward enhancing patient outcomes, fostering clinical satisfaction, and sustaining the vitality of our healthcare systems. Your role in this process is crucial.
As we stand at the crossroads of cost and value, let us choose the path that leads to a future where healthcare supply chain management is synonymous with unparalleled value creation.
Balancing High Risk and Low Risk in Healthcare Supply Chain Management
Risk assessment is paramount in the intricate world of healthcare supply chain management. The dichotomy of high-risk and low-risk elements within the supply chain can significantly influence operational efficiency and patient care outcomes.
Perspective
Tim Ingram
High-Risk Factors: These often include innovative medical technologies, sole-source critical drugs, and specialized surgical equipment. While they may offer substantial benefits regarding patient outcomes, they also carry risks related to availability, regulatory compliance, and cost volatility.
Low-Risk Factors: These are typically more stable and predictable elements such as generic pharmaceuticals, standard medical supplies, and bulk-purchased commodities. They usually involve established supply chains with multiple sources, ensuring consistent availability and competitive pricing.
A strategic approach to managing these risks involves a comprehensive understanding of the supply chain’s vulnerabilities and the potential shocks that could exploit these weaknesses. By categorizing supply chain components into high-risk and low-risk categories, healthcare providers can develop tailored strategies to mitigate risks. This includes diversifying suppliers, investing in predictive analytics, and fostering strong relationships with key partners.
Ultimately, the goal is to strike a balance that minimizes exposure to high-risk disruptions while leveraging the stability of low-risk supply chain elements. This balance is crucial for maintaining the continuity of care and the financial health of healthcare organizations.
Optimizing Value and Cost Through Strategic Risk Assessment in Supply Chain Management
In the multifaceted world of supply chain management, the interplay between value, cost, and risk assessment is pivotal. The goal is to deliver maximum value to the customer while effectively managing costs and mitigating risks.
Value is the perceived benefit of a product or service, encompassing quality, reliability, and brand reputation. It’s what drives customer satisfaction and loyalty.
Cost involves the expenses incurred throughout the supply chain, from procurement to delivery. Effective cost management ensures competitive pricing and maintains profitability.
Tim Ingram
Risk Assessment is the systematic process of identifying, analyzing, and responding to risk factors throughout the supply chain. It helps anticipate disruptions and formulate contingency plans to maintain continuity and efficiency.
A robust risk assessment framework enables organizations to quantify the impact of potential risks on both cost and value. By assessing the value chains of major products and mapping out the supply chain nodes, businesses can identify vulnerabilities and implement strategies to mitigate them. This proactive approach preserves value and controls costs, ensuring a resilient supply chain capable of withstanding various challenges.
“In the multifaceted world of supply chain management, the interplay between value, cost, and risk assessment is pivotal.”
The role of AI is pivotal, given that no single formula can address all facets of Supply Chain Management. The deployment of an interoperable platform that merges various data silos into a cohesive operating system is crucial for streamlining processes and boosting efficiency. This requires a solution that is both prompt and proactive, thus the need for a control tower.
Think about it.
Tim Ingram has had a remarkable 40-year career in supply chain management, which is marked by his visionary leadership and unwavering commitment to excellence. He has led operations in over 22 hospital systems, setting new benchmarks for success through his strategic guidance and operational skills.
Tim has demonstrated exceptional leadership through team building, achieving national benchmark results, and inspiring his teams to deliver outstanding operational outcomes within the healthcare supply chain.
His expertise in strategic sourcing, contract management, and compliance has been pivotal in his roles. Tim's ability to exceed performance indicators has led to repeated recognition and rewards from his leadership teams for his exceptional contributions.
He is the Sr. Subject Matter Expert in Supply Chain Management for Paradigm Venture Group.
