These admission diagnoses lead to a large volume of unique supplies needed for the duration of the length of stay (LOS). The costs associated with ensuring supply availability and timely delivery can add even more expense. When a unit is able to create efficiencies to this process, substantial savings may be acquired.
The materials used in the healthcare supply chain, specifically specialized and high-cost surgical products, have been on a rapid trajectory of cost increases and are becoming as expensive as the cost of staffing and benefits. What can be done to offset these costs is to manage the use and inventory of these expensive materials to enhance revenue, mitigate risk, and ensure that the focus of clinical staff is primarily on patient care (Schneller, 2011). According to Schneller (2011), supply-chain trends for the healthcare sector will place additional emphasis on lowering costs
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Hospitals appear to lag behind other industries in cost-containment measures, materials management, and inventory control. Members of clinical staff are as equally challenging to convince of the advantages of supply-chain efficiency because they are most concerned with the clinical and convenience aspect of the products in use (Cerner Perioperative Solutions, 2005).
This culture of lacking or absent support from senior leadership and clinical staff provides no foundation for necessary change to take hold. Those tasked with attempting to affect change in this environment will eventually become disenchanted with the lack of support and give up trying. Inability to break the cycle of “this is the way we have always done it” will become a show-stopping obstacle without project buy-in from leadership, clinical staff, and all other affected stakeholders. Such barriers to change can be diffused by regular and thorough communication of the strategic goals (Flowers,
SGH has been plagued with patient quality issues, therefore SGH finds itself in a situation which is inherently antithetical to the mission of the hospital. The costs of healthcare continue to rise at an alarming rate, and hospital boards are experiencing increased scrutiny in their ability, and role, in ensuring patient quality (Millar, Freeman, & Mannion, 2015). Many internal actors are involved in patient quality, from the physicians, nurses, pharmacists and IT administrators, creating a complex internal system. When IT projects, such as the CPOE initiative fail, the project team members, and the organization as a whole, may experience negative emotions that impede the ability to learn from the experience (Shepherd, Patzelt, & Wolfe, 2011). The SGH executive management team must refocus the organization on the primary goal of patient
Consolidate and standardize inventories- The variety of items ordered and stocked in the surgery departments results in an overabundance of different products with inconsistencies in sizes and packaging. In the case of this hospital having multiple surgery departments supplies are scattered, and even the same supplies stocked in the departments. This causes inventories to require extra time for assembling materials disbursed throughout the surgery department. Damaged or outdated stock on shelves could be caused by overstocking and hoarding of supplies and instruments. "Cost containment pressures and quality improvement initiatives have prompted healthcare organizations to consolidate these inventories, standardize on certain supplies,
When El Camino Hospital decided to construct its new, $470 million technologically, and seismically advanced healthcare facility, the hospital calculated that the staffing cost to make continuous deliveries would exceed $1 million annually. After all, the spacious design (450,000 square feet) combined with the horizontal layout in the new hospi...
Management of hospital beds is a concern for most organizations. Yet, most approaches are based on static, unadaptable estimates in length of stay (Schmidt, Geisler, & Spreckelsen, 2013). Increased length of stay contributes to longer admission wait times for patients, leading to both patient and staff dissatisfaction, and increased cost for an organization. Hence, process improvement in this area would lead to value added change. However, change is difficult for most. Complacency and fear of the unknown can create resistance within an organization.
The healthcare industry, as a whole, has made great strides towards improving access to he...
Buchbinder, S. B., & Shanks, N. A. (2007). Managing Costs and Revenues. In (Ed.), Introduction to Healthcare Management ( ed., p. pp. -). : . []. doi: Retrieved from
The use of supplies is a problem because we are spending too much money on them. We are a world-renowned hospital with very high-end robots and equipment. Therefore, our surgeons demand the best and the higher valued machines and supplies. Cost and quality need to be considered. We do not want the quality of care for the patients to be jeopardized because of inadequate planning in regards to low quality supplies (Sullivan, 2009).
The age old dependency on stockpiling medications and Class VIII supplies with a 68J placing orders needs to be revised. Most hospitals are limited in space and wish they could double the size of the storage room to increase the inventory of just in case emergencies. The problem that can occur is
Regulation plays a huge role in the healthcare industry. The healthcare industry restrain of health care costs by imposing price controls ignore the long history of failure through that process. Regulated prices prevent markets from efficiently allotting resources, leaning to unescapable deficiencies and failing quality, while boiling improvement and averting care to inequitable black markets. Internationally, tight price controls in Japan manifest many of these failures, while the Netherlands has relished advances in cost and quality by abandoning them for market-based pricing. Government –fixed prices for hospitals in Maryland and under Medicare have worked only to expand costs and the power of providers. Now, with Obamacare increasing the taxpayers’ duty for funding health care, all knowledge proposes that efforts to regulate provider prices will likely prove expensive and counterproductive.
Predictability means the assurance that their products and services will be the same over time and it all locales. For general out-patient clinics, nurses will ask some st...
Inserting this type of demand into pharmaceutical industry, result is quite favorable for the supplier. This issue of lack of bargaining power on the side of the buyer is attempted to be addressed with strategies such as government policies or subsidies to those who cannot afford, tax incentives for companies smaller in operation creating competition, and bulk purchases by organizations such s HMOs and PPOs. (Business Data Insight, 2013)
With the increased cost of manufacturing, pharmaceutical companies have been divesting in their smaller or less profit making operations and focus on large segments. Many Pharmaceutical companies sold their manufacturing sites to contract manufacturing organizations. The dynamics of interfacing with contract manufacturing organization added intricacy in pharmaceutical supply chain network of pharmaceutical companies.
The business environment is increasingly becoming competitive and challenging. In the recent past, manufacturers have found themselves facing the threat of dwindling profit margins due to unfortunate global events such as the 2007 global financial crisis and the on going Europe economic crisis. The need to improve operation efficiency so as to ensure current and future investment yield the highest rate of return has therefore become extremely important. Manufacturers are now actively engaged in, managing their costs, Research and Development, adopting best procurement strategies, among other Actions. While such actions might eventually lead to positive results, additional business value can be achieved through proper management of the supply chain (Waymer, Ivanaj & Mussa 2009; Krivda 2004).
This group is comprised of the manager, service-line specialists, several supervisors, and team leaders. These stakeholders have the responsibility to ensure that the business unit runs smoothly, to manage staff, and to mitigate and solve planned and unplanned events and issues. If this thesis were implemented, these stakeholders would be relied upon to balance the delivery of patient care with a supply-chain intervention that has the potential to negatively interrupt the existing workflows. In addition, these stakeholders would need to be available for regular thesis project meetings and to help mitigate the inevitable situation of resistance to change. These stakeholders also have a vested interest in realizing the positive effects of a successful thesis intervention. Improved supply chain efficiency would result in lower operational expenses and costs per day, translating into higher revenue margins. Improved quality of patient care should also be a dividend of supply-chain efficiency gains because the staff should have higher satisfaction related to ability to manage costs for their patients and work
Competitive advantage matters greatly to those responsible for the management of healthcare institutions. Together with rapidly escalating healthcare costs, increasingly complex medical technologies, and growing regulatory and legal pressures, healthcare organizations face a critical need to improve the quality of care at reduced costs (Cu...