Executive director, department of supply chain management, Cleveland Clinic, Cleveland, Ohio.
Cleveland Clinic consists of a main campus near downtown Cleveland; eight community hospitals; and over 75 Northern Ohio outpatient locations, including 16 full-service family health centers, Cleveland Clinic Florida, the Lou Ruvo Center for Brain Health in Las Vegas, Cleveland Clinic Canada, and Cleveland Clinic Abu Dhabi (scheduled to begin seeing patients in 2015.
Simrit Sandhu joined Cleveland Clinic in 2006 and has been part of its multi-year transformation journey. She assumed her current position as the head of all supply chain enterprise operations in 2013 and has since focused on the organization’s cost basis reduction, while re-engineering and creating an enabling infrastructure including item master and analytics redesign, systems realignment, procure-to-pay optimization, distribution and logistics redesign focused on JIT delivery.
The Journal of Healthcare Contracting: What has been the most challenging and rewarding project you have been involved in recently?
Simrit Sandhu: One of the most rewarding projects has been the formation and launch of Excelerate Strategic Health Sourcing. Excelerate is a provider-led joint venture between Cleveland Clinic and VHA. It is a group purchasing organization that focuses on providing access to market leading contracts through leveraging the clinical excellence of Cleveland Clinic and best-in-class analytics. The journey to building this company has been challenging. Over the last five+ years at the Cleveland Clinic, we have worked hard to build a sustainable cost basis reduction process through physician leadership, clinician engagement and evidence-based informed decision-making based sourcing efforts. We believe that the process and its results are valuable to all like-minded providers. “Value” being defined as quality/cost was always the cornerstone to our strategy, but defining quality and establishing clinical comparability and equivalence of products has been a multiyear journey. We at Cleveland Clinic alone have saved $230 million in less than five years and have a standardized portfolio, often awarding the contract to a lower market share vendor based on proven product equivalence along with appropriate utilization guidelines where applicable.
JHC: Please describe a project you look forward to implementing in the next year or two.
Sandhu: As we grow our membership base and drive value for Excelerate members, our goal is to continue to find innovative ways to provide contracts and services for our membership. We will continue to develop and leverage tools and resources to drive utilization management of products; enhance physician utilization guidelines to help maximize value across suppliers; remain focused on tools that will create cost-performance transparency for clinicians and administrators to enable informed decision-making.
JHC: What is the most important quality you look for in a supplier partner?
Sandhu: Qualities we look for include a willingness to establish shared goals and open communication; the ability to present a united front to the clinical community; and the ability to value transparency and data sharing that allow for performance measures to be established for both parties.
JHC: What is the greatest change we can expect to see in healthcare contracting in the next five years?
Sandhu: We anticipate a more clinically engaged, formulary-based and evidence-driven approach for procuring healthcare products reflected in product standardization and utilization management-based contracting practices. Global data standards will create transparency to supply chain waste, and our contracts will demonstrate our ability to hold both providers and suppliers contractually accountable to helping lower supply/service costs.