PRODUCTS & SERVICES PRODUCTS & SERVICES
Lab should not be overlooked in the supply chain frontier
by Rick Dana Barlow S
ome consider the work the laboratory performs to be part of the epicenter of a hospital’s or healthcare organiza- tion’s practice, yet the department seems to linger on the fringe of expense management attention. Such oversight must be corrected because the department and function are too impor- tant to neglect, according to several supply chain experts who specialize in lab operations.
Mark Krhovsky, Vice President of Laboratory Sales, Medline Industries, calls the laboratory “one of the most critical depart- ments in any hospital.” He further cites a commonly quoted statistic that 70%
somewhat fragile and challenging,” Jurinic observed. “Many products only have one or two vendor options on group purchas- ing organization (GPO) contracts. This is manageable by staying proactive and thinking out of the box. We’ve learned there are a lot of quality suppliers out there for the same item. You just need to hunt a bit [as] they’re not on GPO contracts. Supply Chain can help use their network to find other solutions, whether they be hard-to- find products or lower-cost alternatives of equal or better quality. (Editor’s Note: See Chart 1 for examples.)
Mark Krhovsky
of medical decisions depend on lab results. “That alone should put the lab at the top of every Supply Chain executive’s priority list, Krhovsky insisted. “Also consider that lab has historically been left to their own devices to navigate a complex market of contracts and sourcing initiatives. If I am a supply chain leader, I want to find the areas where my services and assistance can be most impactful. Undoubtedly, one of those areas is the lab, and if the lab runs well, in turn, the entire system has a much higher probability of functioning efficiently.” Eric Jurinic, Vice President, Corporate Supply Chain, Accumen, refers to a simi- lar statistic quoted in the peer-reviewed scientific journal, Annals of Clinical Biochemistry, 11 years ago. “Many people may not realize that lab results can be the majority of a patient’s electronic medi- cal record – some estimate it at 70% to 80%,” he noted. Jurinic points to the COVID-19 pandemic
Eric Jurinic
as a relevant and useful lesson reinforc- ing the need for Supply Chain and Lab to partner up.
“If the last year has taught us anything, we’ve realized that the Lab Supply Chain is
“As a support function, a well-managed and proactive supply chain is foundational to ensure the lab produces a quality result at the right price,” he continued. “Quality, lower cost, continuous improvement are the three pillars of Supply Chain.” Barbara Strain began her healthcare
career in the late 1970s as a children’s hos- pital-based medical technologist before moving to the University of Virginia Health System for the next 34 years, first a micro- biology manager, then overseeing Supply Chain analytics and then leading the sys- tem’s Value Management department. Strain retired from the system in mid-2019 to launch her eponymous consulting firm. Strain, Principal, Barbara Strain Consulting LLC, posits that Supply Chain and the Lab should make beautiful music together from clinical, financial and operational perspectives. “For the laboratory inter-
Barbara Strain
nal supply chain to function the provider supply chain operations and external supplier processes all need to align like a fine-tuned orchestra,” Strain told Healthcare Purchasing News. “For lack of a better term let’s envision this as the ‘Supply Chain Triad’ [where] each part must understand the other’s work streams to assure clinical decision making by relying on accurate verbal and electronic communication.” Further, Supply Chain should help the Lab master three critical articulation points
34 October 2021 • HEALTHCARE PURCHASING NEWS •
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that form a successful equation, according to Strain: Supplier order receipt timing to assure delivery demand, provider order requisition deadline and lab inventory cycle to match the need. (Editor’s Note: See Chart 2 for examples.)
“Timing is everything, so transparency of needs and how best to tweak processes to match those needs along the Laboratory Supply Chain is critical,” Strain insisted. “It starts with a Supply Chain automated and manual inventory management methodol- ogy review and alignment with leading practices to assure no links are broken and are monitored by mutually developed metrics that foster a reliable collaboration.” For Jean Sargent, a veteran hospital sup- ply chain executive-turned-consultant, the expertise of both supply chain and labora- tory professionals should be inviolable and respected, particularly as genomics emerges as part of routine lab work. “Supply Chain are the
experts in supply chain, not clinical functions, and clinicians are experts in clinical functions, not sup- ply chain – aside from the need to have clinicians at the table for Value Analysis, etc.,” said Sargent, Principal, Sargent Healthcare Strategies. “Supply Chain should be responsible for all supplies and purchases within an organization. The clinical lab annual spend is significant, and it is time for Supply Chain to step in and be the subject matter expert to support the clinical lab’s needs. This allows the staff to perform the duties/functions they were hired to do. As healthcare evolves, the use of genomics will expand and become a point of discussions when products specific to a patient’s needs are required. Developing that collaboration now, will set the foundation for the future conversations.”
Jean Sargent Closing the lab loop
While Supply Chain may see value in helping the Lab manage its supply chain expense stream, the Lab also must recognize
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