Why the Supply Chain Matters to Your Organization’s Success

From Population Health to Disaster Preparedness, Supply Chain is your Strategic Asset

Michael Schiller , CMRP Senior Director, AHRMM of the American Hospital Association

In the last decade, supply chain has moved away from being focused solely on acquisition costs to become a core strategic partner within many healthcare organizations. The essential link that ties together all of the various stakeholders in the continuum of care, supply chain is uniquely positioned to play a critical role in population health management programs, disaster preparedness, and fulfilling all dimensions ofthe CQO Movement and Institute for Healthcare Improvement (IHI) Triple Aim.

What is supply chain’s role in population health management programs?

MS: AHRMM assembled a task force of healthcare experts to examine the current population health landscape, determining the scope and impact these programs are having on the physical and behavioral health of people within their communities, definingsupply chain’s current role, and envisioning supply chain’s strategic role moving forward. Based on their research, the group developed several guiding principles for others to employ when implementing their own population health management initiatives:

• Supply chain sits at this intersection and is best suited to collaborate with both internal and external stakeholders - clinicians, suppliers, and distributors, identifying relationships others may not see that deliver benefits that may have otherwise gone unrecognized.

• Technology is key to implementing, managing, and sustaining most population health management programs where information sharing and communication between various parties is critical to improving the health of a population.

• Supply chain professionals are a primary source of data and analytics on which many population health management programs are measured. Sharing robust, objective, and scientifically grounded real-world data between various parties can be used to educate stakeholders on the need for change and secure their support for these changes.

What connection can be made between AHRMM’s Cost, Quality, and Outcomes (CQO) Movement and the IHI Triple Aim?

MS: In 2008, the Institute for Healthcare Improvement (IHI) established the goal of “improving the individual experience of care; improving the health of populations; and reducing the per capita costs of care for populations.” In 2013, AHRMM launched the Cost, Quality, and Outcomes (CQO) Movement where cost, while important, is no longer the primary element supply decisions are based upon. Rather it is one of many elements to be considered when organizations take a holistic approach to supply chain.

As the Triple Aim continues to be adopted by hospitals and health systems as a framework for implementing major improvements, AHRMM has established a clear and important connection between AHRMM’s CQO Movement and the goals of the Triple Aim.

It outlines how supply chain can support the use of data and analytics, establish collaborations across departments and communities, promote prevention and implement standardization and cost control metrics that are all needed to improve patient safety, outcomes and satisfaction, eliminate product waste, and drive holistic, clinically integrated, and strategic care within the value-based reimbursement model.

This approach, calling for improvement of the patient experience, the health of populations, and the reduction of per capita healthcare cost needs to be implemented by all healthcare stakeholders, with supply chain professionals as co-owners within this delivery-of-care model.

In the light of the recent catastrophic natural and man-made disasters, how can healthcare organizations ensure that they effectively prepare for, respond to, and recover from those incidents?

MS: Disaster preparation and/or response goes beyond the healthcare facility walls and it calls for a collaborative and coordinated effort to work together to meet the needs of the distressed community in a time of crisis and trauma. It involves coordination with suppliers, distributors, and group purchasing organizations, community partners, and federal and state responders.

Supply chain plays a critical role in this effort by assuring the uninterrupted, efficientmovement of supplies and services to patients. Efficiency in emergency supply chain management means allocating adequate resources to achieve the greatest aggregate benefitfor as many people as possible.

AHRMM offers practical resources on these topics for healthcare organizations and supply chain departments.