SOURCING & LOGISTICS 2. How can Supply Chain Value Analysis
bring the most value to the organization? 3. Are the right people at the table? The University of Kansas Health System takes pride in placing its patients and its people as its top priority. With people and patients at the top of the list, they saw a need to fully understand what it meant to have a health system that generates and maintains true clinical alignment with the supply chain. The next three years high- light how these focus areas were foun- dational in growing the Value Analysis department into what is now called Clinical Supply Optimization (CSO).
2020-2021 – Discovery during a pandemic Faced with the greatest of needs in the throes of a global pandemic that the world had not faced since the early 1900s, there was much to do, and it all had to be done with urgency. The University of Kansas Health System’s Supply Chain department had already been planning to expand the Value Analysis team and knew that paus- ing that work would not benefit the orga- nization. The need to be fully clinically integrated as a supply chain was greater now than ever before.
Getting the right people Throughout the fact-finding process, they determined that a key piece to drive a suc- cessful clinically integrated supply chain was missing and that the focus had to go beyond financial outcomes by including clinical and operational perspectives. To do this, they needed to recruit executive leadership support to form an additional arm to Value Analysis called Utilization Management (UM). UM extends the scope of work beyond the projected value of a new product into the organization. This team takes supply chain initiatives and reviews their clinical, operational, and eco- nomic outcomes for 12 months. UM stays in constant communication with those end users to drive conversations to achieve the best value for patients, staff, and the organization as a whole. As VA and UM combined formed the CSO team, the next step was to spread awareness throughout the health system and to share how the team supported its clinical end-users. This occurred through inviting key clinical stakeholders to par- ticipate in discussions and in making strategic decisions on which products are used organization wide through clinical evidence gathering, best practice sharing, market trends and insights and by lever- aging the organization’s group purchasing organization (GPO) contracts and commit- ted-volume contracts (Vizient and Captis,
respectively). These conversations took place as part of committee involvement. Today, CSO leads or participates in more 40 clinical committees and facilitates a gov- ernance meeting that supports the strate- gic mission and vision for supply chain to provide the highest quality products to patients and staff at the best value for the organization. These committees are focused on quality and safety, patient out- comes, advanced technology to support new patient populations, and the economic and operational impacts these decisions could make. It is the collaboration between each clinician and CSO team member that creates the success of this program.
2021-2022: Execution and implementation During the second year, CSO discovered a gap within the team—an opportunity identified to enhance the speed to value on project initiatives. Therefore, the team held a business case review and determined a need to incorporate an Implementation Team that would drive conversions from time of product and/or purchased service approval to first invoice paid. This team is instrumental in leveraging end-to-end supply chain knowledge that accounts for changes in purchasing, distribution, and inventory management and control. The team’s collaboration with both clinical and ancillary departments across the health sys- tem, has accounted for achieving contract compliance and a total of $90,000 in savings on converting patient bathing wipes and moving to vendor scrubs alone. Additionally, the CSO team began sup-
porting two new bodies of work: Recall Management and Non-conforming Processes, also known as defective prod- ucts. CSO embodies Supply Chain Quality and Safety, and these processes help staff and patients experience safe, high-quality products. UM put together processes, for- malized a policy and rolled out the added support the CSO team would provide for departments across the health system. One of the most recognized non-conforming products the organization endeavored resulted in a supplier changing their manufacturing process due to the nega- tive product feedback submitted to them, resulting in The University of Kansas Hospital receiving an FDA Certificate for Outstanding Contribution in Promoting Patient Safety with Medical Devices in January 2023. This is the power of the non-conforming process. To date, the UM team has managed more than 325 non-con- forming products resulting in more than $100,000 in credits back from suppliers. Also in 2022, The University of Kansas Health System aligned with Medline as
8 October 2023 • HEALTHCARE PURCHASING NEWS •
hpnonline.com
its strategic distribution partner. Medline provides supply distribution for acute and non-acute care encompassing approx- imately $60.5 million in spend and also supports the organization’s home medical equipment (HME) business that provides hospital-to-home healthcare. Quarterly, both the Supply Chain department and Medline conduct business reviews in which the parties collaborate to discuss oppor- tunities that are then brought before the committees for review and approval. This has helped the health system realize a 97% price accuracy and achieve $425,000 in sav- ings with product conversions. When CSO reviews any product cate- gory, the team discusses opportunities with Medline to determine whether it meets the clinical, operational, and economic needs of the organization. In 2021, The University of Kansas Health System transitioned its medical device reprocessing program to Medline. To date, savings have accounted to more than $1.8 million by utilizing repro- cessed products. The health system has also diverted 17,222 pounds in medical waste out of local landfills. Additionally, Medline has supported the organization in reducing production variation and contributes to product formularies. For example, during the transition to Medline non-acute the team was able to reduce the product for- mulary by 50%. This strategic partnership with Medline has resulted in successful outcomes due to clinical integration and the dedicated Medline support team. With the creation of the Implementation
Team, the execution of new workflows and the strategic partnership establishment with Medline, the CSO team was able to provide $9 million in savings across the health system since inception in mid-2020. The CSO team’s efforts earned them several national awards and recogni- tions in 2022: • Vizient Connections Summit—“5 Rights” of Clinical Supply Management
• GHXcellence Awards—Elevating the Clinically Integrated Supply Chain Award
• Medline Sustainability and Supply Excellence Gold Award—Medline ReNewal reprocessing program
2022 – 2023: Continuous improvement
By the third year, the CSO team had a devoted, talented group in place with consistent and effective processes in working order. The next step was to grow the team for future sustainability by creating and establishing a Procedural Supply Optimization (PSO) team. PSO’s main responsibility is to partner with cli- nicians and physicians in surgical and procedural settings to prevent waste and
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