An article in Modern Healthcare highlights a new Navigant Consulting analysis of hospital supply chains that identified potential savings of $25.4 billion. The study found that the average hospital could reduce supply chain expenses by nearly 18% without impacting quality. Furthermore, savings opportunities could be realized by hospitals regardless of their size, location, or for-profit/not-for-profit status.
Some 2,300 hospitals were compared in the study, which found that by standardizing the use of physician preference items and medications that can produce similar results at a lower cost, hospitals could save up to $11 million each year. That kind of impact on the bottom line could free up more money for nurses’ and doctors’ salaries or for plant improvements or other capital investments.
A Navigant analyst pointed out that in addition to standardizing equipment and supplies, hospitals could standardize their vendor contracts, item sourcing, and bidding processes to realize greater savings. A hospital’s supply chain department can play a key role in providing the right data to the stakeholders to make this happen.