By Erin Yeager, Senior Analyst, Pharmacy, OC Reilly, Inc.
(July 10, 2023) — Every health care system wants to reduce costs. No surprise there.
But decision-makers at these organizations can be surprised when they see how careful, informed, and practical supply chain management can produce not only lower costs but higher operational efficiencies, as well, achieving both budgetary and performance-related success.
In our experience at OC Reilly, focusing on supply chain-managed areas can create meaningful and positive impacts on budgets. But before getting to that level of specificity, every engagement starts with reviewing and assessing existing supply chain-related contracts, terms, and conditions. This requires a tremendous amount of industry knowledge and access to the right information. We use proprietary tools to monitor price and compliance.
Being smart with the careful and consistent application of the most advantageous contract pricing reduces spend, but leveraging relationships – both those long-held by the health care system and its vendors, along with new affiliations brought into the mix – represents another important factor. Maintaining good relationships with indispensable solutions goes a long way in benefiting an organization. Finding a balance among all parties means building on established trust while protecting the bottom line for the health care system.
The OC Reilly team brings the required expertise, institutional knowledge, and first-hand track record to bring disparate vendors together to achieve scope and scale in affiliated products and services. Say a system with multiple facilities contracts with three different vendors for janitorial or linen services. Decision-makers at these separate campuses may not know how those services are contracted or paid for at the other sites. We can serve as the connective tissue, negotiating new contracts to standardize service and reduce costs – a hallmark of insightful budgeting. Such opportunities can be virtually unlimited.
Pharmaceuticals, labor, and supply chain represent the top three areas of spend for health care systems, supply generally gets less attention. Convincing C-suite leaders that significant savings from supply chain management are hiding in plain sight helps drive that perspective deep into the organization, with the resulting actions to follow.
Hospitals have many silos, but bringing people together through relationship building and knowledge of what works can dissolve those silos, win over resistance, and generate higher efficiency and lower costs. At OC Reilly, we know collaboration is key to creating and adhering to well-crafted budgets.
© 2023 OC Reilly, Inc.