Developing a value-based supply chain system

Supply chain transformation is being viewed as a strategic enabler for health system improvement. Therefore, hospitals these days are moving from a fee for service model of operation to a more value-based model when it comes to their supply chain systems. In this panel discussion, Sojwal Vora, Group Supply Chain Head, Manipal Hospital( moderator); Manoj Ahlawat, General Manager-Supply Chain, Max Healthcare; Rakesh Kumar, Supply Chain Head,Indian Spinal Injuries Centre, Delhi and Neeta Pawar, Pharmacy, In-charge, Godrej Hospital examined ways and means on how organisations can align their supply chain processes in this direction and how they can benefit from it.

The panellists primarily deliberated on the focus and purpose of value-based supply chain, understanding the pre-requisites to develop a value-based supply chain, developing capabilities needed for the same, use of automation and technology and its impact on cost and profitability.

The discussion began with Vora asking hospitals to identify the kind of value their supply chain unit wants to bring to the business matrix, internal stakeholders, patients and partners. He spoke about the two areas through which a supply chain unit can bring value — through its suppliers which can be passed on to their business outcomes and by improving internal efficiencies. Pawar cited examples of how her organisation focusses on quality products while maintaining low costs. He said that at her pharmacy, they strictly follow the quality norms and ensure that at all level inefficiencies are negated. She further went on to say that focussing on patient-first approach, helps them to ensure the best quality and lower costs. This also becomes profitable to the business. “Even low-cost products have to be diligently checked for quality. Patient safety is of primary importance, be it the healthcare industry or the pharma industry,” she said. Pawar also mentioned the need for good GMP practices within the supply chain domain.

Sharing his perspective from the procurement side, Kumar spoke about how it is important to lay stringent rules on QC/QA while procuring medicines, devices and medical supplies. “It is important to look for products that have FDA, DCG(I) and CDSCO approvals. While procuring medical implants and devices, it is important to conduct metal quality approval testing as well,” he firmly said.

Ahlawat spoke on how organisations can create value with capital expenditure management. He informed the capital expenditure management has many dimensions. “Good capital expenditure management while balancing patient-centric values entails bringing the supplier on the same page and investing in technology that lasts long,” he said.

The panel also delved into understanding how can hospitals systematically line up their contracts, inventory and other functions to ensure there is no wastage. They highlighted that inventory should be updated yearly, if not in every six months. In the end, experts reiterated that India suffers from a lack of regulation in the healthcare sector, therefore a quality conscious supply chain system is essential. They urged the audience to be self regulated and put patients at the heart of everything.

Highlights

• Even low-cost products have to be diligently checked for quality. Patient safety is of primary importance, be it the healthcare industry or the pharma industry
• Good capital expenditure management while balancing patient-centric values entails bringing the supplier on the same page and investing in  technology that lasts long
• Supply chain in the healthcare industry is less regulated than the pharma industry, so it is even more important to be value-conscious
• Always look for quality, statistics and certificates while selecting a product, especially when it comes to medical consumers
• Patient feedback should be given ample importance
• Put quality first always, it doesn’t matter if you have to compromise on the cost
• Inventory should be updated yearly, if not in every six months