By Matthew J. Rowan
A critical lesson from the COVID-19 experience is the importance of emergency sources of medical products like personal protective equipment when a crisis hits. Nearly 20 states are now considering action to require stockpiles of PPE, but many of those efforts could diminish our nation’s ability to store and deploy useable supplies when we need them most.
Stockpile mandates have the potential to impose unsustainable burdens on our healthcare system, leading to excessive spending, increased prices, and poorly maintained or obsolete supplies. To ensure we are prepared for the next public health emergency, states should partner with the private sector to stockpile supplies using existing medical product storage and distribution infrastructure.
COVID exposed significant inadequacies in our country’s previous stockpiling efforts. According to reporting by the Associated Press, nearly two dozen states had maintained modest medical supply stockpiles prior to 2020, but due to maintenance costs many of those stockpiled products had become outdated and the overall numbers were too small to meet the massive need created by COVID.
Coast-to-coast, states are trying to improve preparedness for a future pandemic by using executive orders or new legislation to require enhanced stockpiles of PPE. Last year, California passed a law requiring employers who provide direct patient care to maintain a 3-month supply of PPE.
These kinds of mandates could create massive new costs for healthcare providers still reeling from the financial impact of COVID. A single 350-bed hospital creating a 90-day stockpile of a typical mix of PPE would need to buy and maintain 13-15 tractor trailers of storage space. To meet the same obligation, a 5,000-bed hospital system of 10-12 hospitals would need the equivalent of 1½ football fields of space.
Even when warehousing on this scale is available for healthcare facilities, buying or leasing it and procuring a continually replenished supply of PPE will create millions of dollars in new costs that may be recouped through higher prices consumers pay for medical services. Smaller or rural facilities have already said they are simply unable to meet these new obligations.
A better way to prepare and maintain stockpiles of critical medical supplies is by utilizing existing commercial storage and distribution infrastructure. Medical product distributors have capabilities in place that can provide available logistics support and the expertise to manage the full range of PPE stockpile maintenance and delivery needs.
Distributors currently maintain more than 76 million square feet of warehouse space at 500 distribution centers across the country. That network is used to distribute medical supplies to the nation’s 6,000 hospitals, 44,500 nursing homes and assisted living facilities, 230,000 physician offices, 267,000 laboratories and 12,200 home health agencies. During COVID that existing medical product distribution system produced historically high results.
In 2020, companies represented by the Health Industry Distributors Association (HIDA) distributed a record 51 billion units of PPE. These numbers represented a 1200% increase in the distribution of N95 respirators and a 150% increase in the distribution of face masks over 2019 levels. They reflect the kind of enhanced capabilities that can be achieved when government and industry work collaboratively.
This type of partnership is already a best practice modeled by the U.S. Department of Health and Human Services’ Strategic National Stockpile. The SNS recently signed contracts to partner with medical products distributors for warehousing infrastructure and last-mile delivery services for critical supplies, which is an important first step to expand upon at the national level and a template that states can follow for more efficient medical emergency preparedness.
PPE reserves will be vital to better prepare our country for a future health emergency and public-private partnerships represent to achieve it. With federal leadership and coordination, state stockpiling mandates should recognize and support these partnerships to most efficiently store and distribute medical supplies without massive new cost burdens on healthcare providers.
Matthew J. Rowan, President & CEO, Health Industry Distributors Association