With the healthcare industry moving more and more toward pay-for-performance models, high-quality patient care is more important than ever. Hospitals must manage efficient inventory systems so nurses and physicians can shift their attention away from the stock rooms to what's most important: the patients.
"Hospitals are in a very exciting and challenging place right now in terms of keeping up with changes in how they provide — and are compensated — for care," says Carola Endicott, vice president of services and operations of Cardinal HealthTM Inventory Management Solutions at Cardinal Health.
Ms. Endicott has almost two decades of experience in healthcare. Prior to her current role at Cardinal Health, she served as vice president at Wavemark, a start-up specializing in RFID technology, which was acquired by Cardinal Health in 2013.
Ms. Endicott also filled a variety of leadership roles at Tufts New England Medical Center in Boston from 1990 to 2003. There, as director of performance improvement, she helped departments achieve workflow improvements and cost savings. In her role as vice president of clinical support services, she was responsible for the product lines of major ancillaries and service lines, including cardiology, oncology and pathology.
She holds a master's degree in organizational development from Harvard Graduate School of Education in Cambridge, Mass., and worked in human resources for two years at the Harvard Community Health Plan.
Ms. Endicott spoke with Becker's Hospital Review about supply chain's increased role in promoting cost savings and improving patient care.
Note: Responses have been lightly edited for length and clarity.
Question: What aspects of the supply chain do you think have the most impact on patient care?
Carola Endicott: Changing reimbursement approaches are drastically challenging our old paradigms. Cost cutting is on everyone's radars. Many hospitals immediately turn to reducing their workforce since it's something that can be easily measured. However, supply chain leaders more and more are taking a seat at the C-suite table to help find savings in other areas so the hospital can maintain a strong workforce that delivers exceptional patient care. Supply chain is not just a back office function now — it can dramatically change the way a hospital operates.
Streamlining the supply chain also allows clinicians to focus more on patient care instead of spending time counting or organizing hospital supplies. We always hear the phrase "the nurses will do it in their downtime," but nurses don't have downtime and this is not a good use of their skills. Their efforts should be focused on taking care of patients, not on inventory.
Q: What do you see as the key supply chain challenges and pain points affecting patient care today?
CE: Hospitals and health systems are merging and looking at supply chain wondering how to extract value from the consolidation. They have to figure out how to create more cost effective storage and delivery mechanisms that allow them to get supplies where and when they need them for their patients. It's basic supply chain delivery — block and tackle kind of work — but the old rules of how to do that are getting thrown out and remade.
Another challenge is to assess the supply cost associated with the amount of delivered care. The cost of purchasing a product is housed in one system — an ERP system or materials management system — while information about what products or supplies hospitals use for a specific patient is located in a billing system or EMR. Bringing those data elements together in one system is falling to supply chain, in concert with their IT and vendor partners, to make sure these care delivery costs are understood, measured, and reduced.
The challenge of effectively tracking inventory also affects patient care. Manual tracking systems undoubtedly allow for human errors despite the hospital's best efforts to prevent expired products from remaining on the shelves and reaching patients.
Q: How can inventory technology, analytics and process improvements help supply chain leaders address these challenges?
CE: We're moving a lot of our customers' manual systems to an automated platform using RFID and other technologies that limit the amount of clerical work clinicians have to do. Someone doesn't always have to be counting or handling the supplies. It's a real win-win. Supply chain's end user customers have the products they need — where you need them, when you need them — and clinicians can spend more time with patients. Seamless cloud-based models that connect hospitals with manufacturers can drive down costs since there are fewer touches in the supply chain.
Real-time, automated technology solutions can also help close the knowledge gap surrounding the true, current cost of delivered care, as I mentioned earlier. And this information, in turn, helps health systems evaluate the sustainability of their current clinician-driven supply chain practices.
Furthermore, there is a shared interest between hospitals and manufacturers in item level tracking, which can track the lot, expiration and serial number of every product passing through the supply chain in real time. If there is ever a recall on a device that is lot or serial based, or a product that is expired, a cloud-based inventory technology that connects manufacturers, distributors and hospitals lets everyone in the value chain know exactly where the product is, allowing providers to pull it off the shelf before it reaches the patient.
It's an incredibly exciting time to be in healthcare supply chain. We've just begun to see how supply chain can drive increased efficiency and support better patient care and outcomes.
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