As COVID-19 deaths accumulate across the country, countless healthcare organizations remain hard at work trying to secure the critical equipment and supplies required to treat the heavy stream of patients they encounter every day.
This isn’t the first time — and it won’t be the last — that hospitals are faced with a healthcare crisis. But can lessons from the past be applied now? And what can we learn presently, and never forget, going forward?
"We often talk about a panic/neglect cycle," stated Dr. Eric Toner, a senior scholar at the Johns Hopkins Center for Health Security, in a February 14 article published by the Center for Infectious Disease Research and Policy (CIDRAP). "Every time there's a crisis, people get into panic mode and there's a lot of intense response for a short amount of time. Then the crisis passes, and no one pays attention until the next crisis.”
For many supply chain professionals this rings absolutely true — and for a variety of complicated reasons.
Reflecting on past and present decisions
“During this pandemic, this country, as a whole, used unprecedented amounts of PPE,” Luis Soto, MHA, Lee Health's vice president of supply chain management and central sterile processing departments in Fort Meyers, Florida, told HealthCare Business News. “The nation was and is in crisis, and there is a lot of finger pointing. If a health system is proactive, they should always maintain a separate pandemic inventory that they can use during a disaster. It is very important that this inventory be rotated on a regular basis to ensure that it is not expired. Great care must be taken to do the same for any emergency management disaster carts.
Although hoarders may be inevitable even in cases where an emergency inventory has been sustained, he stressed that a spike in PPE utilization is more likely to level out once hospital workers recognize there is a process and a system in place that is keeping them protected. When the management of the crisis is successful, a new base line between supply and demand will emerge.
“In the past the goal of supply chain was to be efficient and keep less stock on hand,” said Jelena Marinkovich, MBA, director of materials management at Palos Health in Illinois. “After going through this crisis, we have learned that we need to have at least 90 days of essential supplies on hand.”
What worked for one disaster is not necessarily going to work for another, according to Gregg Stepp, a supply chain veteran with more than two decades experience, some of which he says involved working through various past disasters. Stepp, who was recently director of materials management at Bayfront Health in St. Petersburg, Florida, added, “Contingency plans have to be made and continuously updated to reflect current and upcoming problems.”
Soto also notes how critical it is for organizations to not only keep close track of daily inventory levels but to be aware of how assets are being distributed
“It is very difficult to practice universal precautions during a pandemic,” he said. “From a supply perspective I always consider risk when using PPE. For example high-, moderate- and low-risk, with the most PPE obviously being used in high-risk units and working out to less PPE for low-risk units.”
(Not) made in the USA
Experts agree that part of what has made the coronavirus so devastating is that the virus originated in a country that we typically depend on for many essential PPE products. Moving production from overseas to domestic facilities could make a huge difference in the event that something like this were to happen again.
“There was no time to increase production to help with demand,” said Suzi Collins, a supply chain management professional in Texas, who described the outbreak as a “perfect storm.”
“I would hope that we learn to have a larger backlog of product here in the U.S. and also consider ways to produce closer to home,” Collins, who requested that the name of her organization be withheld over concerns of repercussions, added. “Though there are many vendors who claim they can get product in, the steps of getting through customs are still causing long delays.”
Soto agrees the manufacturing of healthcare supplies should come back to the states but takes the argument further. “In January, manufacturers immediately put hospitals on allocation to try and maintain a constant flow of PPE while the demand and utilization in hospitals grew daily,” he said. “To make matters worse, our allocations were cut even further, and our deliveries stalled when the federal government stepped in and went to the front of the line to purchase PPE direct from manufacturers.
During this early phase in the pandemic, Soto recalls being bombarded with emails and solicitations from people claiming to know someone who knew someone who could get them PPE. Going through the offers carefully, the hospital discovered the offers were more harm than good.
“At Lee Health we quickly put a process in place working closely with our infection control and procurement team to validate any and all leads for PPE,” explains Soto. “Unfortunately, very few, if any, have panned out as being credible. The majority of these vendors are price gouging or want money wired up front with no clear lead time for delivery.”
Since then, the CDC has issued guidance to help hospitals identify counterfeit masks that are not approved by the National Institute for Occupational Safety and Health (NIOSH). The tips, available on the CDC website, include watching out for masks that have no markings at all on the filtering facepiece respirator, or masks that use ear loops instead of headbands.
To GPO or not
Many, if not most, healthcare systems today have contracted relationships with Group Purchasing Organizations (GPOs) in order to secure needed products and services. In times of crisis, do these connections pay off?
“I strongly believe that working with GPOs is an advantage for the hospital during this challenging time,” asserted Marinkovich. “Besides assisting in getting adequate supplies, they were really helpful in providing information on supply availability, sharing the information on what other organizations are doing to manage workflow and supply shortages.”
On the other hand, hospitals should also keep in mind that many distributors have shifted to just-in-time inventory management to keep stock lean and reduce carrying costs, which makes sense in general but can lead to trouble when an unexpected crisis arrives. Consequently, organizations might want to consider taking a more independent approach.
Stepp added, “Where I really see a problem is in the main distributors being caught, more than hospitals, unprepared. Distributors have dropped inventory levels due to their margins shrinking as well, to the point where stock items are no longer stock, and they hedge to JIT [just in time]. Nine out of 10 times it is OK, but it is that 10th time that everyone remembers.
“Regardless of the disaster, there will always be things that are a must-have,” Stepp continued. “Gloves, masks, gowns and face shields will ALWAYS be a priority for safe patient and environment handling. Every hospital should have a temperature-controlled storage building to store these supplies in a cache. Manage them as part of your inventory, monitor and swap out as needed. Nobody could have foreseen this scale of shortages but having a month’s worth in storage would be worth the $100 per month for the storage fee.”
Also, distributors need to be more transparent about supplies and contracting — whether done in-house or via intermediaries — and should be multi-sourced by different countries and manufacturers, according to Eugene Schneller, department of supply chain management at W.P. Carey School of Business at Arizona State University.
“There is a need to manage risks in a comprehensive risk program and fully understand Tier 1, 2 and 3 suppliers, as today’s manufacturing is a huge web of companies,” said Schneller. “Hospitals scrambling independently for PPEs is one sign that collaborative purchasing is not a significant partner in something as big as this pandemic. GPOs need to work with members to reestablish some nature of communal value — beyond price, through consolidation of spend.”
Soto takes the position that although GPOs may try to help, providing instructive webinars and emails, their efforts are of little value in a crisis when the thing that makes the most difference is actual boots on the ground.
And Collins said, “I would hope that especially going into the fall and the unknown of a secondary outbreak, that our distribution partners will maintain higher levels in their vast warehouses. As a for- profit hospital, it is always about inventory turns so we manage very tightly. But we have all learned quickly that it is difficult to operate a hospital without PPE. I think we have also learned that we need to better understand what our distribution partners are doing and what they keep on hand.”
In this together
Despite how different healthcare systems procure, distribute, and use their supplies, one action that that should remain universal across the landscape is cooperation, understanding and respect for people in all departments involved.
“Supply chain should never practice medicine!” asserted Schneller. “Supply chain can assure that products are equivalent — and can set up processes to collaborate with clinicians. We need more clinicians in ‘linking-pin roles’ where they have a foot in both worlds — and can fully represent their colleagues’ needs and concerns.
“CEOs need to articulate the ‘mission-critical’ role of supply chain and reward clinical participation,” continued Schneller. “Make sure your CEO is not the weakest link in the supply chain but influencing hiring and vision. Assure that even if you are in the executive suite, you are not treated as a cost-revenue center.”
Soto describes how his organization seems to be taking that path. “We are very fortunate that our supply chain at Lee Heath has a proven track record of success and established credibility,” he said. “We also have a history of full transparency and collaboration with our stakeholders/clinicians and medical staff in everything that we do. Our senior leadership team has also been extremely supportive of our efforts. Everyone at Lee Health has been extremely cooperative and proactive and most importantly all have worked together as a team to get through this pandemic.”
Schneller also stressed that hospital intermediaries need to incorporate a public health focus into their strategies. “Healthcare delivery systems have not seen this as part of their sustainability focus, but we see — no public health strategy can destroy sustainability.”