OC Reilly Blog: Very Good and Totally True

By Bill O’Connor, President and CEO, OC Reilly Inc.


(Aug. 10, 2015)–“If something sounds too good to be true, it usually is.” We’ve all heard, and have probably said, that familiar phrase. Most times, the sentiment is accurate – but not always.

In the world of health care administration, a very good thing (lowering costs) can co-exist with another very good thing (maintaining a high quality of care) harmoniously and successfully. Too good to be true? No, it’s more like, very good and totally true.

But it doesn’t happen without insight, planning, communication, and cooperation among vital players in the process. The July/August 2015 edition of Supply Chain Strategies & Solutions features an article by John Willi, vice president of Supply Chain Management at the NYU Hospitals Center in New York City, in which his organization has achieved the “very good and totally true” goal. 

“Previous studies demonstrated that more than 75 percent of hospital expenditures for total joint arthroplasties are derived from three main sources: 1) the hospital room cost; 2) operating room cost; and 3) implant cost. In an economic analysis performed by our surgeons and supply chain management, it was demonstrated that efforts to control costs in these three areas can lead to significant cost, quality, and outcomes resulting in improved overall economic health of our patients and hospital,” Willi writes.

“In addition, the adoption of newer, more costly technology should be based on demonstrated likelihood of benefit and not be routine until clear evidence suggests it is appropriate,” he continues. “This implies that any increase in cost must be accompanied by a clinically proven improvement in outcome.”

Identifying areas where a more careful and considered examination of resources can lower costs while maintaining high quality of care is not that difficult. The challenge comes in reaching a shared mindset among administrators and physicians that achieving this goal must be a priority.

It’s the classic win-win scenario. Patients receive the top-level care they expect and deserve. Doctors retain the freedom to practice medicine, safe in the knowledge that quality will not suffer. And administrators enjoy the best of both worlds – lower costs and high quality of care.

Too good to be true? No way. Very good and totally true. And completely attainable, through optimizing supply chain management tools and techniques.

Copyright 2015 OC Reilly Inc.