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How to Limit Waste in Hospital Supply Chains

Analysis  |  By Christopher Cheney  
   October 09, 2018

Limiting waste of perishable supplies and other products reduces costs in a way that goes straight to the bottom line.

Editor's note: This article is based on a roundtable discussion report sponsored by Vizient. The full report, Supply Chain Success: Achieving Efficiency Gains, is available as a free download.

Hospitals and health systems can drive supply chain efficiency with waste management efforts such as limiting the waste of perishable products.

To limit waste of products, the onus is on supply chain teams to make sure inventory strategies match how products are used, says Ryan Martter, strategic sourcing manager at Rush University Medical Center in Chicago.

"If we only stock sutures by a box of 12, but clinicians are consuming sutures one at a time and it's a specialty item that they use four or five times a year, the balance in that box is just going back to sit on a shelf. If the box expires and you place a new order, you're buying another full box to use a handful of sutures."

Physician culture is also a key factor in waste management, Martter says.

"Do you have a culture where everything is immediately opened and ready to go before the case even begins? If so, a supply might be on a preference card just in case it is needed, but if it is always being opened and never runs into the scenario where it's needed, it always becomes a wasted item."

The preference card process should be dynamic, says Stephen Downey, Group SVP of supply chain operations at Vizient Inc. in Irving, Texas.

"If you look at other industries, you don't take a bill of materials and say this is it, then only use half those bills every time. That would just not survive in a manufacturing industry. You would adjust your bill," he says.

Preference cards should be adjusted for what gets consumed, Downey says. "Everybody feels a sense of success when you realize what you saved through that process, but it's a continuous improvement."

Surgical technicians and physicians should document the supplies and implants that are used during a procedure, says Theodore Pappas, who works in supply chain management at Mayo Clinic in Jacksonville, Florida.

"They have to tell us what they're using—if they are opening and not using items and wasting product. We need to be able to identify that. We have to be able to collect that information and share it with the stakeholders. … That kind of cost goes right to the bottom line. If you can eliminate waste, that reduces your cost significantly," he says.

Hoarding prevention

In addition to cutting costs, efficient product management also limits hoarding of supplies, Pappas says.

"When it comes to waste and product on the shelf, you talk about hoarding and hiding things in drawers and other types of activities that caregivers are accustomed to in certain circumstances. In many cases, we are failing as a supply chain if we allow that to happen—we are not putting the right things in the right place at the right time so it's easily attainable for caregivers," he says.

Clinician hoarding often leads to waste of perishable products, Pappas says.

"If a supply is readily available for them, they are not going to have to hoard it the next time. We also need to teach them why that's important and the implications of hoarding. You need to share the cost of expired product expense," he says.

Changing behaviors

Waste management often requires changing behaviors among clinical care teams.

Altering the behavior of staff members should be a collaborative process, Downey says.

"You help everybody understand what the organization is up against and why you're working on change. You're trying to help care teams do their job better. Together, you look at waste and the information that has been gathered. You also have to accept that changing habits and behavior is not going to happen quickly. You can't expect that everybody leaves on Friday and on Monday there's an entirely new process," he says.

Pappas says sharing waste information data with staff is critical to achieve changed behaviors such as sharing the overall expired product that's being wasted. "You need to share information in various formats. It's not just an email. It's not just a conversation. It's both, and it's also presenting the information to the teams involved."

View the complete HealthLeaders Media Roundtable report: Supply Chain Success: Achieving Efficiency Gains.

Christopher Cheney is the CMO editor at HealthLeaders.

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