Clinical Engineering and Supply Chain. Mitchell Foldi Director of Healthcare Solutions PartsSource, Inc.

Transcription

1 Clinical Engineering and Supply Chain Mitchell Foldi Director of Healthcare Solutions PartsSource, Inc.

2 Agenda Introduction Supply Chain and Clinical Engineering Current Procurement Process Inefficiencies in the current procurement process How changes in healthcare are driving an evolution of the procurement process Effecting change

3 Introduction Mitchell Foldi Director of Healthcare Solutions (330) PartsSource Nations largest multi-modality, multi-manufacturer supplier of medical replacement parts. Technology and Service Provider for Clinical Engineering to facilitate the replacement parts procurement process

4 Replacement Parts Industry $5.0B Annually spent on Medical Device Replacement Parts 1,100 OEMs (GE, Siemens, Philips, Toshiba, Steris, Stryker etc.) Secondary Suppliers 42% of devices will require a replacement part EACH YEAR Average cost spent on repairs = $3,300/bed per year

5 Supply Chain and Clinical Engineering Hospital Supply Chain Entire book of purchased items Cleaning supplies, bed casters, X-ray tubes, syringes Clinical Engineering Overlaps with Supply Chain Manages sourcing of necessary replacement parts Works with Purchasing to facilitate the procurement of replacement parts Executes the repair of broken devices/modalities Employs manual, inefficient processes today

6 Current Procurement Process Double Order Entry Device Fails Dispatch Manager Enters Work order Tech Receives Work Order No Tech Diagnoses Part ( s ) Calls OEM Ave call length minutes to get OEM list Price Tech selects which supplier to use ( random ) Tech enters part request into CMMS PO Generated in ERP by Procurement Specialist Replacement Part Arrives No Tech Reviews Part Can part be used? Yes Tech Installs Part Is device Contracted? PO Sent to Supplier Tech Returns to Supplier NO Does Part work? Full $$$ Yes What type of contract? Shared Services $$$ Calls 2nd Supplier Calls 3rd Supplier Calls Additional Suppliers if price cannot be found Supplier Ships Part Supplier reviews and sends replacement Calls OEM Average Tech makes 2.4 supplier calls after initial call to OEM OEM Sources Part

7 Service Contracts OEM and ISOs Outsource repair Outsource procurement Hospitals lack systematic control over these expenses Fine print 15-25% of parts purchased should have been covered by a contract Invest in technician training $60,000 training fee $300,000 cost reduction by eliminating a service contract

8 Trends in Healthcare Decreasing Budgets, Increased Workload Healthcare Reform = Change (good or bad) Quality Outcomes Driven Clinical & Financial Competition = Choice Price & Patient Experience is Paramount Industry Consolidation Provider M&A on the rise Technology Adoption EMR, HIE, ERP, ECM Efficiency & Best Practice Methodologies a Must Centralized Data, Analytics, and Reporting

9 Trends in Healthcare IDN s often consider cost savings methodologies over revenue generating approach Capital budgets get slashed Life of modality must be extended Less net new device sales means a drop in OEM Net New revenue Increased replacement part costs to make up for lost revenues Mergers and Acquisitions are on the rise Disjointed line of business applications Data everywhere Difficult to predict spend These trends force all of us to do more with less Operate as efficiently as possible

10 For Example Take a moment to think of a fully scheduled day of CT scans. As the day begins, the scanner breaks How much money have you lost?

11 Impact to Clinical Engineering Healthcare Reform Requires all areas of the hospital to be nimble, less rigid Driving Costs Out Hard Cost Savings + Productivity Gain Quality Outcomes Drive Forces scrutiny of current procurement process Competition = Choice Device downtime means negative financial impact, & patient experience Industry Consolidation M&A forces management of disparate solutions and disjointed data Technology Adoption CE is one of the few areas where a holistic solution doesn t exist Efficiencies and Best Practices Optimize the processes in place today and make them better, not just faster Data, Analytics & Reporting Difficult to access, use, and analyze. Analytics to compare to the industry, region, or peers

12 Clinical Engineering and Analytics CE and Procurement do not work in the same application CE uses CMMS (computerized maintenance management solution) Manage work orders Procurement will use ERP Issue PO s for the parts needed by CE This causes double entry, higher chance for human error, disjointed data difficult to predict spend Cannot apply Business Intelligence to make better purchasing decisions

13 Is your procurement process efficient? Do we have a dedicated resource(s) who sources parts 24 hours a day, 7 days a week? Does this resource gather statistical information on all of your purchases and input this data, without error, into your CMMS and ERP simultaneously? Does this resource guarantee you ll never purchase a replacement part that should be covered under a contract? Does this resource predict failures and preemptively suggest purchases to decrease urgency and lower shipping costs? Does this resource evaluate your supply chain in real time? Does this resource have insight into the industry s best practices and the ability to change tactics on the fly? Can this resource track the shipment of the parts he or she orders in real time? Can this resource report on the management of returns at any time and without notice?

14 Summary There are gaps in the Clinical Engineering and Supply Chain processes Sends ripples throughout the organization External forces dictate some thought be put toward this silo of the business ACA, HIPAA, Meaningful Use Small changes in the process can make big impacts to the bottom line There are companies out there who are contemplating these issues and developing solutions to problems you might not realize exist Value Innovation

15 Thank You!