Suppliers' Role in Achieving a More Sustainable Healthcare System

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By Brian White

As a healthcare professional, you are keenly aware of the need to keep patients healthy. It’s a need that motivates you and drives you to continuously improve in your profession. Now it’s time we, as an industry, use that same kind of passion toward improving the healthcare system. 
It’s time we advocate for true sustainability—both fiscal and environmental—for our hospitals and healthcare system. Working together, we can achieve this needed change. As device suppliers, we must act more as allies and bring solutions that truly benefit you and your hospitals. After all, the obligation to provide quality care and reduce the environmental footprint of healthcare delivery is on all of us.

Healthcare System: Today
The relationship between hospitals and suppliers is evolving in response to a more challenging economy. Reimbursement rates are continuously declining. According to the purchasing alliance Premier, healthcare providers can expect cuts in reimbursement payments of up to 15 percent to 20 percent by 2017. Similarly, participation in group purchasing organizations (GPOs) is up, and more than 50 percent of U.S. hospitals now belong to integrated delivery networks (IDNs) that share savings and improve bargaining power. Many hospital executives use these cost-reduction measures as a critical part of their business plans.

Leveraging the supplier
As suppliers, we also need to change how we conduct business. The definition of success must move beyond financial statements. Instead, we must provide solutions that generate true sustainability—not just short term cost savings.  This means providing solutions that benefit everyone—the hospital, the healthcare system and, especially, the patient.

As a healthcare professional, make sure you work with your suppliers to help solve your toughest business challenges—chiefly, how to reduce costs and serve more patients without compromising the quality of care delivery.
Fixing the healthcare system will not be an easy task. Fortunately, there are joint coalitions of professionals around the healthcare industry working on solving these problems.

One example is Practice Greenhealth’s Greening the Supply Chain Initiative. The initiative engages businesses in meeting the emerging demand for more environmentally preferable products within healthcare facilities, GPOs and in the marketplace. The organization aims to provide a set of common tools for purchasers, suppliers and manufacturers to ensure that environmentally preferable and cost competitive products are available as the industry shifts toward more sustainable purchasing systems. Giving hospitals a framework for smarter resource management will enable the necessary shift to an efficient care delivery system. The framework is still in development, but the initiative’s forthcoming outcomes will offer much-needed solutions for hospitals.
 
Integrated medical device models
In terms of the supply chain delivering holistic value, a specific area that needs to be looked at closely is medical devices. Suppliers of medical devices should focus on providing next-generation devices that will help usher in a new era of sustainability. Hospitals should be wary of contracts that only provide short-term cost savings in lieu of future all-inclusive benefits. Tomorrow’s medical device programs must deliver long-term fiscal and environmental value.

One medical device offering that’s increasingly attractive to hospitals seeking value-based purchasing platforms is reprocessing programs. According to the Association of Medical Device Reprocessors (AMDR), third-party reprocessing programs are employed safely by more than 50 percent of U.S. hospitals and 100 percent of U.S. News & World Report Honor Roll hospitals.

If you are considering implementing a third-party reprocessing program at your hospital, here are some key points to consider as you work toward making your facility not only healthier, but also more sustainable and profitable.

Safety: One of the primary goals of a hospital is to promote patient safety. In the U.S., third-party reprocessors are held to the same regulatory standards as original equipment manufacturers. The reprocessing of medical devices is codified in federal law, requiring FDA 510(k) clearance to assure reprocessed devices are substantially equivalent to the original devices. The FDA oversight is so exacting, Academic medicine researchers at Johns Hopkins University School of Medicine found reprocessed medical devices have a reliable safety record of excellence similar to that of new equipment.

Costs: After patient safety, another significant  concern for hospitals is controlling costs. After all, if a hospital is not able to balance its budget, it may be challenging to provide quality care for patients. Some hospitals enter into exclusivity agreements with medical devices suppliers in an effort to control costs. However, if these agreements prohibit hospitals from participating in sustainability initiatives such as reprocessing programs, they may not only reduce savings, but over time, can cost a hospital thousands of dollars. Take an active role in ensuring the contracts your facility enters into do not preclude your ability to participate in future sustainability efforts. The reprocessing of medical devices has already helped hospitals in the U.S. save  millions of dollars each year. This may sound too good to be true, but it’s not. Reprocessed medical devices provide savings to a hospital in several ways.
First, reprocessed medical devices typically cost about half as much as original manufacturer (OM) devices labeled as “single-use.” Second, hospitals save money using reprocessed devices by diverting operating room waste away from costly disposal techniques. The savings on purchasing the product and waste disposal can be redirected back into the hospital for quality care initiatives. For example, instead of paying for higher-cost devices, you can hire more healthcare personnel; and instead of paying to dispose of additional waste, you can invest in educating that additional staff. By using reprocessed medical devices, the hospital has the potential to save money and create a more sustainable economic system.

 
Environment: It’s no secret we have a problem with waste disposal in this country. And as members of the healthcare industry, we are contributing to the problem. In fact, the healthcare industry is the second largest contributor of waste in the United States, producing more than 4 billion pounds annually. Only food waste accounts for more space in our landfills. Using reprocessing programs helps healthcare facilities reduce their environmental footprint. In fact, AMDR members helped divert an estimated 9 million pounds of medical waste from landfills in 2011 alone.

Healthcare System: Future
As members of the healthcare industry, it’s time we stand up and strive to improve our field. It’s time for a system that drives maximum value for hospitals and delivers the best-possible care for patients. Work together with your medical device supplier to ensure you are making truly sustainable decisions at your facility. Meet with the device purchasers at your facility to talk about improvements and more sustainable product choices. By engaging all stakeholders, you give each person an opportunity to share in the effort of becoming more sustainable.

 
Implementing these changes can decrease costs and increase environmental benefits in your facility. This is the direction the healthcare industry must go—and one that will benefit all of us.

Brian White is president of Stryker Sustainability Solutions, an industry leader in third-party medical device reprocessing and remanufacturing. 

 

 

 

 

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