E Procurement Essay

1646 words - 7 pages

Care Healthcare Supply Chain Management

Supply Chain Management plays a vital role in our hospitals today. With the growing cost of healthcare and new technologies, it is vital for hospitals to run as efficiently as possible and without jeopardizing care. To the materials manager and to the financial minds of a hospital the area of supply chain is a tedius task at best, the kind of planning, strategizing and measuring that seldom goes recognized and rewarded. The work involved with inventory control fits tightly within that description.
In many hospitals today, it is easy for inventory control to go astray and become uncontrolable. This is the case with I Care Healthcare System. Too ...view middle of the document...

O.'s. In fact much of the time is spent making sure that the packaging and pricing are correct in the hospital system vs. the distributors system. The other issue is that many of the high ticket items (Orthopedic implant, Cardiology and Cath Lab products) do not go through the distributor and in most cases are on consignment, where it is easy to use the product and be billed for it later totally losing any control over the inventory.
Many hospitals today have upgraded to accounting, materials management systems and storage solutions, such a Lawson, Smart Stream, Par Excellence, Pixis etc., that allow easier tracking of purchases and usage. However, these systems are very expensive and in most cases still going through growing pains, they are also cost prohibitive to many hospitals around the country. For example, Lawson was traditionally an accounting and finance tool that is trying to build a platform to connect with the materials environment and although they have been somewhat successful, it is very combersome and there are continuing issues with running reports. It is also very expensive and there is a charge for connecting to each manufacturer. Pixis on the otherhand is a fairly simple system that tracks very well the usage of products being stocked in the cabinet system, but you are restricted with drawer space as to what you can stock. Also, Pixis is more of a storage and tracking solution rather than an overall materials management solution. Eventually the healthcare industry is hopeful that there will be a barcoding solution in the future that will eleviate many of the issues facing them today. Many hospital pharmacies are already using such a system, and it is also being used in patient care to track patients from the moment the enter the hospital until they are released. However, in the Medical area it is a little more difficult, where every drug has
Supply Chain 4
an NDC number attached, that is not the case with medical products and there is little regulation for disposable products (tape, gauze, electrodes etc.), not to mention numerious manufacturers for many of these types of items. Until that time comes, if ever, there needs to be another solution.
There is no quick fix, but I will start with a list of criteria that will help us better control I Cares inventory, understand what is being spent, where it is being spent and areas where we can cut costs on supplys, which according to ASCET (Achieving Supply Chain Excellence through Technology) makes up between 25 and 30% of a hospitals operating costs.
1. Understand your spend. Knowing exactly what you are keeping in inventory, where it comes from, and how it's received, handled and stored is critical to inventory reduction efforts. There are many programs that can gather and track this data, but technology is an enabler -- not a solution. There must still be business processes in place to analyze this data to make it worthwhile.
2. Rationalize SKUs. This requires data...

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