Becker's ASC Review

43 Executive Briefing: How to Benefit From Supply Chain Partnerships A large portion of any ambulatory surgery center's budget is focused on implants and supplies used per case. The implant selection and use affects case cost and supply chain efficiency can make an immediate impact on a facility's bottom line. That's why it's so important for ASCs to work with suppliers who are valued vendors at their facility. ASC owners and operators run into several supply chain man- agement issues throughout the year. The biggest headaches can include: 1. Inventory management. Materials managers must track in- ventory coming into the surgery center to ensure clinical staff are prepared for their cases everyday and avoid cancellations. The administrator also needs ordering data to keep the budget balanced and ensure supplies don't expire on the shelves. It's easy to lose track of inventory and nurses may hide materials around the ASC so they'll always have a few extra supplies avail- able if the main closet runs low. 2. Physician preference items. Individual physicians may insist on using certain tools because they have experience with spe- cific brands and a relationship with their vendors. However, if those tools aren't in the ASC's current contracts, they could cost a premium price. ASC operators want to work with surgeons to make the ASC comfortable, but also need to cover their expens- es, especially if they could lose money on high-cost implants with low reimbursing payer contracts. 3. Inaccurate price points. ASCs don't always obtain the best price for implants and supplies based on the volume and type of product ordered. In some cases, ASCs can achieve savings by purchasing in bulk or standardizing to achieve the bulk rates. Other times the invoice for materials doesn't match the negoti- ated price and ASCs pay more than initially thought for certain products. 4. Last-minute shipping costs. Just-in-time ordering and ship- ping costs for implant systems and other devices burden the ASC. Whether it's because the ASC ran out of materials with- out replenishing fast enough or a surgeon decides to bring in a complex case at the 11 th hour, the freight expenses these items takes a huge toll on the center's bottom line to avoid a prevent- able cancellation. 5. Product shortages. There are some products, including im- portant pharmaceutical drugs, the ASC needs but are in short supply. Shortages drive up the cost of products, forcing ASCs to purchase from different vendors or find alternative supplies. ASCs can limit the economic impact of these shortages by en- gaging the alternative options when the need arises instead of hunkering down with the same company and suffering high prices or cancelled cases. There are several strategies ASCs can take to overcome supply chain management issues. First, appoint a materials manager who will keep an eye on all inventory, ordering, contracted rates and invoices to ensure the centers is running efficiently and cost-effectively. This person is responsible for scheduling regu- lar audits, identifying discrepancies and recovering lost inven- tory or profits from overpayments. The second step for ASCs is automation, which often means partnering with an outside vendor. Automating the inventory management system to check-in and check-out supplies keeps a digital record with easily-run reports on the ASC's progress. The process also helps materials managers avoid ordering du- plicates. The administrator and materials manager can also see ordering trends to make sure they aren't over- or under-order- ing at any point during the year. Finally, working with physicians to standardize materials and im- plants can make a huge impact on materials costs. There may always be a few items purchased on consignment or special or- der for unique cases, but if the bulk of the procedures come from one or two vendors the ASC can incur savings. The savings are especially big when the surgeons choose to partner with the lowest cost implants that don't compromise quality. Hillsboro, Ore.-based Acumed is a medical device manufactur- ing company that partners with facilities to improve the ASC overall. The company was founded as a small family business in 1988 and launched its first arthroscopy screw line for ACL liga- ments in 1991. Now products include implants for the elbow, foot and ankle, hand and wrist, hip and pelvis and shoulder pro- cedures. As a partner, Acumed offers industry expertise and benefits beyond the typical provider for outpatient surgical facilities, including: • Supports surgical cases • Works with administrators for the best pricing • Identifies opportunities to bring more cases into the center • Works with centers to generate profits from new cases How to Overcome 5 Big ASC Supply Chain Headaches & Leverage Partnerships for the Future By Laura Dyrda Sponsored by

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