Hospital supply chains face shortages, long delivery times amid inflation

After COVID-19 led to a reduction in the supply of personal protective equipment, the effects of the pandemic have led to a chronic shortage of a wider range of medical supplies.

Health systems stockpiled masks, gowns, gloves, face shields and other personal protective equipment that were in short supply at the height of the pandemic. But now they are dealing with continued shortages across the supply chain, a problem that is expected to continue amid the war in Ukraine and related gas supply restrictions, slowdowns in transportation and labor problems.

According to David Hargraves, senior vice president of supply chain at Premier, a group buying and consulting organization, stocks in short supply are now about five times what they were before the pandemic. In January, the amount of scarce products was 10 times higher than the pre-pandemic level.

“Each of them requires the work of identifying a replacement product and changing the item master data in the enterprise resource planning system. This means that supply chain leaders are not wasting time on other cost reduction strategies,” said Hargraves. “We have heard from supply chain leaders in a number of healthcare systems that this has resulted in a huge waste of resources.”

Health care systems such as the Tampa General Hospital, the 1,040-bed inpatient hospital with 21 affiliated imaging centers in Tampa, Florida, and the University of Utah Health in Salt Lake City face a constant shortage of contrast used for imaging. GE Healthcare, a leading supplier of contrast agents, announced in April that it was rationing orders after its manufacturing facility in China was temporarily shut down due to COVID-19.

Tampa General Hospital did not have to restrict procedures because it kept supplies and found an alternative manufacturer. While the market has improved, the hospital must remain vigilant, said President and CEO John Kouris. “We had to move some of our contrast margin to image the heart,” he said.

China’s zero-tolerance policy on COVID-19 could lead to more shortages as GE Healthcare hasn’t significantly changed its manufacturing model, said Erin Fox, senior director of pharmacy at the University of Utah Health. “What we saw earlier this year could happen again,” she said. Local anesthetics like lidocaine and epinephrine have been frustratingly short, Fox added.

According to Premier’s predictive analytics, which predicts shortages based on the execution data of approximately 5% of the country’s acute care hospitals, shortages of contrast media are likely to remain for the next month. Roughly 15% of MRI and X-ray contrast agents are likely to be in short supply for the next three to six weeks, according to a Premier report provided to Modern Healthcare ahead of its release on Thursday.

More than 20% of surgical automated tourniquet systems are expected to be in short supply. Manufacturers of contrast agents and automated tourniquet systems are vulnerable due to restrictions on oil and natural gas in Eastern Europe.

Over the next month, there will be a shortage of 15% of emergency medicine products such as needle stabilizers and catheter stabilisers, and more than 10% of interventional specialty diagnostics, although none of these categories are being impacted by European energy providers.

A total of 120 categories of frequently used hospital supplies are likely to run into shortages soon, according to Premier. “It looks like a Whac-A-Mole issue across a wide range of products,” said Matt Bossmeier, Premier’s director of supply chain analytics and IT services.

For pharmaceuticals alone, the Food and Drug Administration lists about 125 medicines that are currently in short supply. One is the widely used antibiotic amoxicillin, which is difficult to obtain due to the rise in respiratory illnesses among children.

Predictive analytics can help supply chain leaders and physicians prepare for shortages. A week’s notice may allow them to test alternative providers and integrate them into their systems. But deficit forecasts could also spur hoarding, Fox said. Not all hospitals can stock up on groceries, she said, and some will be aware of shortages before others.

Fox said the FDA is working on a rating system that will evaluate the reliability of a manufacturing plant’s quality system and reward high performance. “We need a functioning supply chain with more transparency so that we can assess risks and potential fixes more,” she said.

Meanwhile, disruptions in supply chains will cut into the finances of hospitals that are already facing high labor costs and inflation, said David Dobrzykowski, assistant professor of supply chain management at the University of Arkansas and director of the University of Walton College of Health. Health systems and hospitals often have to pay higher prices for substitute products, he said.

As of the end of August, the producer price index had risen to 14.3%, but according to a white paper written by Dobrzykowski and colleagues, manufacturers passed on only 4.2% of that cost to hospitals. In the coming months, supply producers will likely roll back those higher costs, he said.

“There is still a lot of pent-up inflation in the supply chain. So far, a very small percentage of higher producer costs have been passed on,” Dobrzykowski said. “Despite the fact that health care systems have been financially tight, there are no signs of relief.”

Source link

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to top button