May/June 2023 | From HIDA's Healthcare Distribution & Supply Chain™ magazine

For one full week in February, sunny Florida was the hub of the medical supply chain industry, as distributors, manufacturers, group purchasing organizations, providers, and government agencies gathered for HIDA’s Healthcare Supply Chain Collaborative conferences.

At the Contract Administration Conference, participants tackled longstanding issues of data misalignment between stakeholders, with the goal of enhancing pricing accuracy. The Supply Chain Visibility Conference advanced ongoing work to effectively monitor the health of the medical supply chain and to create guidelines for releasing product from government stockpiles when needed. Through case studies, roundtables, and working discussions, the conference provided an ideal venue for discussing challenges and advancing collaboration and resilience.

Key Takeaways

  • Government and industry partnerships forged during the pandemic are holding up — and getting stronger.
  • Supply chain challenges aren’t over, and the medical supply chain may never return to pre-pandemic standards.
  • Demand planning must expand beyond historical data to include market analysis and awareness of external factors, such as shortages of raw materials.
  • Emerging technology is enabling progress in contract administration and increasing supply chain visibility.
  • Frequent conversations and collaboration with trading partners — in a proactive as opposed to reactive manner — are vital to understand how one stakeholder’s decisions affect all parties involved.

Data Alignment, Pricing Accuracy Are Top Priorities For Contract Administration

At HIDA’s 2023 Contract Administration Conference, more than 150 contract management professionals tackled longstanding issues of data misalignment between stakeholders, with the goal of enhancing pricing accuracy and reducing rework.

The Contract Administration Conference built on HIDA’s ongoing initiative to improve pricing accuracy. Resources resulting from this work include the HIDA Contract Administration Standards, recommended formats for contract communications, and a new toolkit for GPO admin fee reporting.

Data Standardization

Participants discussed how unique device identifiers such as Global Location Numbers (GLNs) help trading partners accurately share information. Speakers for one session emphasized that standard formats for data sharing allow for greater automation and processes — which is vital, as manually keying in long, cumbersome identifiers often leads to mistakes.

Furthermore, inclusion of customer GLNs in the rebate and chargeback claims process has the potential to significantly reduce discrepancies by more than half — in fact, a joint HIDA/GS1 US Price Accuracy Initiative (PAI) Workgroup Proof on Concept indicated 66% reduction in a test sample. As a speaker stated, one scan could push toward the possibility of three “nevers”: never out of stock, never out of date, and never using expired product on a patient.

Technology Solutions

The conference featured case studies showing how technology can be leveraged to improve contract administration.

In one such presentation, several participants in a pilot for healthcare contract data proposed blockchain as a solution. Speakers elaborated on how this secure technology provides true touchless automation and drives efficiency and cost savings.

Other speakers presented on a variety of tech solutions, from moving data to the cloud to enhance price accuracy to automating the RFP process to drive accountability and improve consistency.

Collaboration With Trading Partners

Most importantly, the conference facilitated face-to-face dialogue between professionals from different types of organizations, helping them to understand how their decisions impact their trading partners. As one panelist noted, the savings from contract agreements “go away really quickly if we have a lot of transaction issues.” Improved communication was a common theme for conference attendees, and one panelist noted the importance of effective communication — sharing the most relevant data, not too little or too much — as it’s efficient for all partners involved.


Supply Chain Visibility Conference Stresses Need For New Thinking

HIDA’s Supply Chain Visibility Conference brought together leaders from public and private sectors to identify ways to increase preparedness and improve medical product availability. The event stressed partnerships and information sharing as key components of supply chain visibility in order to better match product supply and demand and avoid shortages.

Supply Chain Challenges Persist

Disruptions to the medical supply chain will continue. Lars Jensen, one of the shipping industry’s most highly regarded experts, provided a forecast for shipping congestion and transportation delays.

Although global freight rates are dropping, upcoming risks and challenges include:

  • Significant blank sailing, likely with short notice
  • Networks undergoing more changes than usual
  • High uncertainty regarding contractual environment
  • Possible labor action impact on the U.S. West Coast
Demand Planning Must Expand Beyond Historical Data

Historical data about patterns or production and consumption are integral to demand planning, but those aren’t the only predictors of usage for medical supplies. Substitutions can have a major impact — as time goes by without a preferred item, substitutions can then create new demand. This can also change as new products come out, or when physicians with particular preferences retire.

Demand planning should include market analysis and awareness of external factors, such as shortages of raw materials. It’s not sustainable to only monitor supply and wait until a product is unavailable to take action; it’s crucial to be proactive instead of reactive. Data sharing across the entire supply chain ecosystem can lead to more accurate forecasting.

Forward-thinking health systems are embarking on major initiatives to increase resilience by better understanding product criticality and risk as well as identifying clinically acceptable substitutes for key items. Provider supply chain leaders shared how they are collaborating with their suppliers to ensure these initiatives result in fewer back orders and stockouts.

Technology Is Enabling Progress

Conference presentations highlighted ways that tech solutions are increasing supply chain visibility, from tracking shipments as they cross the ocean to sharing inventory levels at various locations. In one case study, presenters shared their experience with a data-driven software company to create a crisis-averting, patient care–elevating healthcare supply chain ecosystem. As a result, they’re better able to anticipate product shortages and make informed decisions on substitutions.

Participants praised the level of collaboration at the conference and the ongoing commitment to maintain the strong lines of communication that were forged between the public and private sectors during the pandemic.