Publisher’s Letter July/August 2009

The supply chain and the swine flu…

As summer winds down, and school and cooler weather approach, another major flu challenge seems certain to stress our nation’s healthcare supply chain. All the great people, systems and processes that comprise the supply chain certainly need to be versatile enough to address disaster, pandemic and other disruptions, both seen and unseen. Yet it’s still unsettling to see a major issue coming, and to plan for it like the H1N1 flu that JHC explores on page 40.

When the World Health Organization Director characterizes the further spread of the H1N1 flu as “inevitable,” all links in the supply chain should take heed. But what is the correct balance? When does stock piling turn into panic buying for distributors and hospitals? When does limiting purchases by suppliers cross into allocation or rationing? And how is it decided which hospital gets what quantity when allocation starts?

For years, the debate has continued on how physician preference items like orthopedic implants and stents disrupt the supply chain budgets for even the best-run hospitals. The constant battle between the ever-advancing technology from manufacturers and the ever dwindling reimbursement puts the supply chain executives in a hard-to-win situation. For the most part, this case volume is pretty predictable and steady unlike the possible looming care demand the H1N1 flu may be bringing.

There are often great variances in the way hospitals plan, manage and execute just about any facet of the facility. For years, I have been concerned about the lack of vehicles to help hospitals share, measure and implement best practices for just about any function in the hospital.

I have a suspicion that the variance of preparedness for the coming flu season is great as well. Some hospitals may have comprehensive task forces together to make sure a pandemic plan is in place, while other hospitals may not be preparing any more than they did in previous years.

So as you read this in late summer, what are your expectations for flu season? What steps have you taken to mitigate the impact on your hospital(s) and communities? Please send me your thoughts and insights. It will be fascinating to see if you got it right!

Thanks for reading this issue of The Journal of Healthcare Contracting!

About the Author

John Pritchard

John Pritchard is the publisher of The Journal of Healthcare Contracting.