Tragedy Tightens Supply Chain

It took a tragedy to do it. But for an extended period of time in September, all the members of the supply chain managed to align themselves in one direction. In response to Katrina, manufacturers waived drop-ship fees, donated products, suspended price increases and honored rebates with little regard for the fine print. Distributors found themselves delivering competitors’ products, GPO executives acted as vital communication links between beleaguered providers and their vendors, and IDN contracting professionals worked to help their organizations deliver patient care under the worst of conditions.

The relief effort actually began before the storm hit the Gulf Coast on Aug. 29. Owens & Minor, Cardinal Health and others implemented disaster plans, which included supplying customers with products to help them operate through an extended emergency. But the true test came immediately afterward, as hospitals and nursing homes struggled to stay open long enough to care for or evacuate their patients.

In the days immediately after the storm, Mark Miriani, MedAssets Supply Chain Systems’ senior vice president of contracting, and Jeff Graham, its vice president of technology and customer support, joined with others from the Atlanta-based GPO to help its members Ð especially Ochsner Clinic Foundation in New Orleans Ð obtain critically needed supplies and equipment. At one point, MedAssets issued a call for a 9,000-ton stainless steel tanker filled with potable water, so Ochsner could generate water pressure for toilets, showers and sinks. By Sept. 6, MedAssets had organized a donation program offering matching funds up to a total of $100,000 for contributions made to Ochsner.

Locating supplies was difficult enough, but actually transporting them to hospitals was tougher. “We’ve had to work very closely with all sorts of different channels to get trucks through,” said Miriani, four days after the hurricane hit. Roads were blocked by trees, debris and flooding; security became an issue, too. With phone lines and most cell phones down, communication was difficult.

MedAssets conducted daily conference calls with its channel partners Ð including Cardinal Health, Owens & Minor, Sysco Corp. and others Ð to match providers’ needs with products. The company also accepted donations on behalf of its members, and worked with distributors to make sure donated items were shipped where needed.

Executives with St. Louis-based Amerinet also were in touch daily with suppliers after the storm. Amerinet shareholder Vector services the Gulf Coast. Among its largest accounts in the area is LSU Health Sciences Center. LSU’s Director of Administrative and Support Services Joy Barnett was instrumental in setting up a warehouse where donated items could be delivered and distributed to hospitals as needed, said Bill O’Donovan, program manager for diagnostic services in Vector’s Birmingham, Ala., office.

“We are in contact with manufacturers, asking them to help our distribution partners get supplies,” said Senior Contract Manager Gene Byerly, several days after Katrina struck the Coast. In some cases, manufacturers themselves acted as distributors, shuttling other companies’ products to the stricken area in their trucks. And an Amerinet facility’s linen truck driver delivered a variety of supplies Ð including intravenous antibiotics and cardiac drugs Ð to a non-Amerinet member, reported O’Donovan.

Manufacturers agreed to honor rebates to distributors whether or not the end user was an Amerinet member, and others agreed to hold off on price increases that had been scheduled to take effect Sept. 1.

After the storm hit, the Birmingham office staff manned its phones 24 hours a day. And as post-Katrina days turned into weeks, the staff focused less on procuring supplies and more on providing consulting expertise to providers that were forced to set up new patient care areas outside New Orleans. In some cases, outlying hospitals were forced to beef up capacity. In other cases, hospitals had to convert administrative space to patient care areas.

Staffed by a pharmacist, medical-surgical specialist, a former lab manager and others, the Birmingham staff was able to help these facilities determine what they needed. “Many times, we get calls from non-medical people,” said O’Donovan. “This is where the consultative part helps.”

Ten VHA hospitals and thousands of VHA-hospital employees were affected by the storm, reported VHA Public Relations Director Lynn Gentry. In fact, Katrina damaged or destroyed the homes of 6,000 employees. For that reason, VHA’s post-hurricane efforts were multi-faceted, focusing not only on maintaining the integrity of the supply chain, but also on tending to the needs of its members’ employees and helping hospitals outside the affected area find staff to care for an influx of evacuees.

From Day One, VHA’s Gulf States office in Baton Rouge worked with suppliers and members to coordinate the flow of information and products. Members responded with generosity, said Gentry. Some examples:

Carolinas HealthCare System in Charlotte, N.C., and Novant Health in Winston-Salem, N.C., sent a new mobile hospital to New Orleans for six to eight weeks.
Memorial Hermann Healthcare System in Houston provided helicopters to airlift critical care patients from Ochsner Foundation Hospital.

The day after the hurricane hit, Irving, Texas-based VHA wired $250,000 to its Gulf States office to provide immediate aid to hospital employees who lost homes and property, said Gentry. The VHA Health Foundation followed with another $250,000. VHA sent requests to its members around the country, asking for rapid donations to help Gulf Coast hospital employees get back on their feet. Through donations and pledges, VHA expected to collect $2 million for distribution to hospital employees.

VHA also conducted a fundraising drive among employees and pledged a 3-to-1 match on contributions. Employees were given options on donating, including payroll deductions and donations of financial awards received through the company’s recognition program. In addition, VHA modified its employee volunteer policy to enable employees to take 40 hours of paid leave to serve in official volunteer efforts to evacuees. Individuals from VHA’s IT team used VHA-donated equipment to set up computer stations at the Salvation Army in Arlington, Texas, for the use of evacuees trying to contact family members.

Established after the Sept. 11 terrorist attacks, the Premier Inc. Disaster Support Team in San Diego mobilized suppliers and distributors to get emergency supplies to Premier member hospitals in Mississippi and Louisiana, as well as to evacuees, according to the company. Premier also put clinical staff in Houston to aid evacuees there.

Among the emergency deliveries accomplished:

  • Women’s Hospital Foundation in Baton Rouge received 40 bassinets and cribs from a Premier hospital.
  • Cardinal Health and Fisher Scientific International delivered blood culture bottles and agar plates to North Oaks Health System in Hammond, La.
  • South Central Regional Medical Center, Laurel, Miss., received disposable infant bottle nipples from Abbott Laboratories’ Ross Products Division, Columbus, Ohio; ice from US Foodservice, Inc., Columbia, Md.; and tetanus toxoid doses from Morris and Dixon Co Ltd., Shreveport, La.

Premier member Harris County Hospital District in Houston was managing care for evacuees in the Houston Astrodome. The site received several deliveries of waterless hand sanitizer. In addition:

  • Abbott donated $150,000 worth of adult and pediatric nutritionals.
  • Fisher Scientific International donated 1,000 anti-bacterial wipes and waterless hand cleanser.
  • Medtronic Inc., Minneapolis, Minn., delivered automated external defibrillators and pacemakers.