Methodist Le Bonheur Healthcare

Rusty Parker

Backorders, limited raw material availability, manufacturing plant closures, staffing challenges, transportation barriers, and inflation all influence the health care supply chain at any given point in time

Over the past 24 months, all these factors descended on the industry simultaneously.

Historically, disruptions are usually restricted to one product or only felt regionally and only for a short period of time. The disruptions over the past two years are unlike any other in history. Much like the COVID-19 virus itself, the supply chain impact reached all areas of the world; however, unlike current virus trends, these disruptions continue to escalate.

Every healthcare system is experiencing the same supply chain challenges, making us attempt to solve the same problem with incredibly limited resources. For example, pre-pandemic, a backorder might affect a product line or a small number of SKUs, and the impact might only affect a quarter of the U.S. In response, the healthcare system would work with the supplier or distributor to shift product from other areas with less demand. If that was not operationally feasible, clinically equivalent substitutions were available to be sourced in the place of the desired product. We could manage a disruption like this with only temporary frustration and then quickly move on to the next challenge.

Today is wildly different. Now, disruptions are company-wide and affect entire product categories. Alternative vendor support is only available to healthcare systems that are interested in making whole category conversions to the vendor providing the support, with no guarantee a product will be available. Substitutions are not offered as the entire industry is on allocation and how can you have an allocation if you don’t have an order history?

These challenges are not new for industry leaders, but are now multiplied by record levels of inflation, soaring shipping costs and shipping delays. Many of us thrive in the complexities of our industry. To be clear, never have we been more tested in innovation, collaboration and sheer determination as we seek solutions to provide the best care for the patients we are privileged to serve.

“Instead of sitting idle waiting for the disruption, we are proactively preparing to meet the needs of our clinicians and patients”

As we evolve through this pandemic, we’ve found new opportunities to further engage with the global supply chain. For example, we follow the product from early stages of production to dock delivery for better understanding of the logistical pain points. We are improving inventory management and forecasting to better meet future demands and COVID-19 surges. We are cultivating new supplier relationships with domestic partners to shorten the supply chain. We’ve also found cost savings in areas that historically have been unsuccessful.

Instead of sitting idle waiting for the disruption, we are proactively preparing to meet the needs of our clinicians and patients. For healthcare, supply chain failure is not an option. Solutions and results are what we do, and we’ll take all the lessons learned from the past two years to spring forward into the next unknown

When I stop to think about the insurmountable challenges we’ve faced since early 2020, I’m truly inspired by the resiliency of our industry. Together, we’ve suffered through the longest of days and worked to creatively solve the most complicated issues together. We continue to stand tall as we face the ripple effects of this epic crisis, and must retain that level of agility as we establish our new normal.