Reimagining Regional Hospitals’ Approach to Supply Chain Management

Updated on December 5, 2022
supply chain in health care

The unique components that make regional hospitals the cornerstones of their communities – localized care and independent management, the ability to attract new businesses, and higher employment rates – can also be a detriment for the hospitals themselves as they face higher material costs, supply chain difficulties, and technology access hurdles.

With the global supply chain facing constant pressure since the onset of the pandemic, the impact on healthcare has been crushing. Regional hospitals continue to demonstrate strength and ingenuity in the face of adversity, but the ever-present possibility of supply chain volatility threatens the viability of these hospitals. However, regional hospitals can flourish by employing a strategic, collaborative approach to today’s dynamic healthcare environment.

Community-Based Hospitals Create New Purchasing Pathways 

With deeper roots in the community, regional hospitals often focus on long-term, preventative care to keep their communities healthy and foster engagement between patients and providers. The intangible, but invaluable, benefit of community hospitals is the undercurrent of human connection.  

According to the American Hospital Association, 32% of community hospitals are independent rather than system-affiliated. Many of these hospitals are up against a complex supply chain environment without the resources to navigate ever-shifting cost structures and technology.   

Despite this unforgiving reality, regional hospitals know there is strength in numbers. Alone, they might not have the buying power of a large hospital system, so community-based hospitals developed the pioneering idea to come together as regional purchasing networks, offering a much stronger negotiating position to drastically reduce supply costs. This type of innovation and foresight is just one of the many unique qualities that make regional hospitals such valuable assets to our local economies and our communities.

Supply Chain Complications Put Pressure on an Industry Already Under Strain

While large hospital systems typically have stronger purchasing powers to offset a massive uptick in supply costs, it’s much more difficult for regional hospitals to negotiate cost increases. 

A recent study from the American Hospital Association found that medical supply expenses grew 20.6% through the end of 2021 compared to pre-pandemic levels. 

The entire healthcare industry is at the mercy of the variable global supply chain, but fluctuations in material availability, transport times, and costs disproportionately impact community-based hospitals. The Health Industry Distributors Association found that transportation times for medical supplies are now 440% longer than pre-pandemic times, which causes widespread delays.

Staff at community-based hospitals are stretched razor-thin, and asking them to continue managing through supply chain delays and materials shortages will only add to their burnout. These supply chain and cost disruptions have a devastating domino effect that can disrupt or eliminate access to healthcare in community-based and rural settings. 

Opportunities to Optimize the Supply Chain for Community-Based Hospitals

Supply chain issues will happen; it’s an unavoidable side effect of an interconnected global system. However, hospitals (especially regional organizations) can focus on logistics solutions that mitigate those challenges while providing cost-saving opportunities.  

By collaborating with a supply chain partner with industry connections and the expertise needed to negotiate beneficial solutions, regional hospitals can focus on what they do best: providing top-level, personalized care. Solutions like logistics and supply chain management can relieve the pressure from community-based hospitals and offload the responsibility of supply chain logistics to a team of experts.

The emphasis on human connection that sets community hospitals apart is also what makes a great supply chain partner. While technology and data can put the spotlight on opportunities for growth and evolution, true change comes from a partner’s deep understanding of the hospital staff’s day-to-day processes. In the constant unpredictability of a hospital environment, it’s difficult for the team to take a step back to see where outdated processes might be costing time and money, which is where a supply chain partner can also be a valuable resource.

Community-Based Hospitals Are Poised to Innovate

Regional hospitals are the foundation of countless communities. By providing patient-centered care, employment opportunities, and community engagement opportunities, these hospitals have a lasting impact on the areas they serve. 

With the right systems, technology, and, most importantly, a team that understands each hospital’s unique needs, regional hospitals can build on their deeply rooted tradition of serving local communities while looking ahead to new possibilities. 

Courtney McDermott serves as Sales Executive at TRIOSE®, where she excels in generating new business opportunities specifically geared towards small to mid-sized healthcare facilities. McDermott began her career at TRIOSE as a Client Support Specialist and was shortly after promoted to Implementation Supervisor before making the transition to a TRIOSE Sales Executive. During her 11-year tenure at TRIOSE, McDermott has built a thriving customer portfolio by placing a special emphasis on the unique needs of regional, independent, and critical access healthcare facilities across the county. Notable accomplishments include winning the TRIOSE Sales Excellence Award twice throughout her time at the company. McDermott is passionate about providing innovative supply chain solutions to her prospective healthcare clients so they can focus on caring for their local communities.