Three Keys to Success for Supply Chain Preparedness and Resiliency

By David A. Hargraves, Senior Vice President, Supply Chain, Premier Inc.

Global demand for PPE and other hospital supplies skyrocketed earlier this year as active cases of COVID-19 created 17 times the typical burn rate for N95 respirators and 8.6 times the burn rate for face shields, among other critical supplies. In many hotspots across the United States, PPE supplies dwindled from two weeks’ supply in February to just one or two days of inventory by March in the wake of this demand surge.

Since that time, many manufacturers have expanded production, including domestically, and overseas trade has partially resumed. But even with these helpful developments, the med-surg supply chain remains strained with thousands of items still on protective allocation. It’s clear that providers’ supply chain teams must use this time to think and act strategically in terms of their sourcing and purchasing partnerships.

New technology and tools are making it possible for providers to better anticipate case surges and related supply needs – capabilities that are essential to not just patient care but also to financial solvency, given the financial uncertainty hospitals and health systems face. In fact, 95 percent of health care finance administrators surveyed in May by Bain & Co. said their organizations are likely to roll out cost-saving initiatives with equipment and supplies purchases as the primary focus.

Amidst this landscape, here are three insights and capabilities that will help providers build a stronger, more proactive supply chain.

Leverage Technology as an Early Warning System

What health care providers needed at COVID-19’s inception – and will continue to need moving forward – is a reliable way to help predict potential waves of COVID-19 cases as well as their current supply levels, product burn rates and sourcing challenges.

With the right technology and data, this is possible.

New technology is leveraging automated, real-time surveillance capabilities that integrate with existing electronic health records (EHRs), providing an early warning capability, forecasting surges and helping providers plan coordinated responses and resources where they’re needed most. Technology like this overlays predictive modeling with clinical surveillance and supply chain data, thereby creating a powerful projection for a provider’s supply utilization, based on the volume and severity of cases in the area.

Armed with this information, decision-makers are better able to plan and allocate supplies, as well as receive an early indication of potential shortages.

Apply Hospital Census Data

Until recently, health care providers have been largely on their own to translate local surges into immediately meaningful information regarding capacity and supplies. Enter the technology to predict the COVID-19 census for any U.S. hospital on a given day. No, it’s not from the future – this capability is readily available and allows providers to visualize their facilities’ COVID-19-positive census in near real-time and identify upcoming hotspots – critical intelligence to plan for both surges and routine care and the supplies for both.

This technology gives a leg up to providers who have been planning their day-to-day capacity using publicly available information such as case growth per capita and COVID-19 hospitalization data, which often lags by a week or more. This kind of data also ignores the question of whether spikes in COVID-19 cases are likely to overwhelm the hospital, which is ultimately the critical question providers need answered.

In addition to identifying hotspots and forecasting census, providers can rely on this type of technology to provide a comprehensive listing of PPE and other critical supplies related to the crisis with direct links to ordering information. Not only does this help providers anticipate demand for key supplies, but it also enables them to react more quickly to avoid shortages within their facilities.

Think Strategically with Stockpiling Efforts

Early experiences accessing government stockpiles this spring proved challenging, so it’s little surprise that as of June, the vast majority of health care providers reported they were actively contributing to their own stockpiles or ones for their states. Providers reported intentions to build their stockpiles of critical medical supplies and drugs to hold upward of 90 days of inventory.

This activity is essential for medications in particular, and although most manufacturers have noted they have months of finished dose and active ingredient supplies available, Premier data shows that when COVID-19 cases surge, ordering for certain drugs can increase by as much as 3,000 percent. At that rate, months of supply on hand quickly turns to no supply – and providers who build adequate safety stock now stand better prepared for potential future surges.

Given the strains on the med-surg supply chain, providers pursuing individual stockpiles should consider working with a strong purchasing partner who will rally contracted suppliers, mobilize a global direct sourcing network, execute forward buys and secure additional supply through non-traditional partnerships. This comprehensive strategy allows providers the ability to obtain high-quality supplies, including many products required for stockpiling – and helps insulate their supply chains to withstand fluctuations in surge demand.

Conclusion

Improving our supply chain response to pandemics and addressing future problems that could arise is a tall, but achievable, order. And we are already beginning to take the critical steps needed. With the keys to success outlined above, providers can take their supply chain preparedness to the next level, gaining the actionable intelligence and partnerships they need to more accurately predict and manage their supply chain during the pandemic – and beyond.

Reprinted with permission from the Association for Health Care Resource & Materials Management (AHRMM) from Supply Chain Strategies & Solutions magazine, Sept/Oct 2020 issue. Copyright 2020 by AHRMM. To learn more, visit www.ahrmm.org.