OpScoop Chapter II Issue XXIII: Logistics Problems In Healthcare

Healthcare remains one of the most profound industries that caters to individuals in their hour of need. Like any other industry, supply chain management remains a challenge to them. In healthcare, managing the supply chain is typically a very complex and fragmented process. Not only do they need to cater to the patients but also to the doctors in order to provide a seamless operational state of affairs without being visible to both.

Healthcare supply chain management involves obtaining resources, managing supplies and delivering goods and services to providers and patients. To complete the process, physical goods and information about medical products and services usually go through a number of independent stakeholders including manufacturers, insurance companies, hospitals, providers, group purchasing organizations and several regulatory agencies.

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Complexity in Hospital Supply chain

Optimizing this chain would have significant cost benefits for any organisation. For example, healthcare supply chain decisions are taken in the context of requiring and providing the right quantity at the right time. In order to do this, a lot of supplies are pre-ordered, which results in unnecessary hoarding of costly inventory, thereby nullifying the objective of the entire process. How can this be tackled?

Since the supply chain touches every department of the organisation, utilizing the data from them accurately, would help in understanding the usage better. This data can then be then utilized to make decisions on the consumption patterns rather than the purchasing patterns. In order to do this, hospitals need to be focused on an integrated supply chain, which would ensure greater transparency, by ensuring product availability, reducing storage costs and area, increasing patient care area and reducing material handling time. This can only be achieved when the clinical and non-clinical operations are all accounted for, and an umbrella view of the entire process is considered. During this process, another important resource which needs to be considered is the time spent in completing this process, as time effectiveness is as important as cost effectiveness, particularly in this sector.

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Flowchart of Supply Chain Management in Hospitals

In India, since a lot of data related to patients and hospital is either lost or is available in physical format, it not only makes data retrieval difficult, but also makes it difficult to have a universal repository and formats of data to optimize it and get meaningful insights. Another classic problem of the Indian healthcare space is the perception of “out of responsibility” zone, which is a result of departmentalization mindset of government and private organisations alike.

Better transparency, both in maintaining and utilizing data, for patients as well as organisations, would go a long way in improving the results. Also, the focus shift from understanding the difference between providing quality service to providing quality care would hold the organisations in good stead in understanding the decision-making mindsets of the customers and patients, and thereby understanding the need-based approach better.

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