You can’t optimize the healthcare supply chain in 2014 without technology.
That was the simple yet profound message offered by Leigh Anderson, chief operating officer of informatics & technology services at Premier healthcare alliance, on Sunday at HIMSS14. Anderson spoke at the Supply Chain Symposium, a pre-conference event focused on improving the synergy between the supply chain and IT divisions at hospitals and health systems.
“Health IT and supply chain come together around revenue cycle,” Anderson said. Everyone in healthcare has heard the slogan “without margin there is no mission,” he noted, but said it’s worth reiterating when discussing supply chain and IT, because operationalizing that truth is so important to a hospital’s success.
“Very simply, managing COGS – the cost of goods sold – is one of the areas that CFOs look for improvement, because it’s a zone of potential variation,” Anderson said. “Those of you in IT should know that good things begin to happen when marginal revenue meets marginal cost.”
A number of critical factors are pushing health systems to closely examine supply chain analytics: reimbursement is shifting downward in the fee-for-service environment; hospitals are penalized financially for readmissions; the national economy remains stagnant; and everyone anticipates decreasing patient volumes and financially threatening shifts in patient acuity trends.
As financial storm clouds gather, Anderson said CFOs could leverage IT in the supply chain to bolster their hospitals’ strategic initiatives. He provided examples of how advanced analytics could help define hospital resource utilization by DRG, and align data between an organization’s enterprise resource planning software and the electronic health record. He said business intelligence should be optimized to better comprehend the links between supply costs, resource utilization and patient outcomes.
“Get to know your business intelligence expert – become his best friend,” Anderson joked. “That person can help you use analytics to drive best practices and collaboration.”