Five Essential Steps to Positively Impact Your Bottom Line with Actionable Analytics

Mark Whitman

By Mark Whitman, Director, Supply Chain Diagnostix Services, Intalere

Everywhere we turn in the healthcare industry today, we hear talk of “big data” and its growing and potential impact on healthcare delivery. The use of data will continue to grow as we move further and further down a path of pay for performance. Let’s look at five ways organizations can properly use data to bring efficiency, savings and enhanced outcomes to their operations.

Take Control of Your Item Master

The item master is your organization’s information source for some of the most important supply chain activities – procurement, charge master comparison and/or linking, data standardization and value analysis. If this data is disorganized and contains errors, then it will be very difficult to improve operations and control costs in your facility. Streamlining the item master will help your organization attain transparency of your supplies and support trending of utilization.

Utilize Best Possible Pricing

Taking advantage of best available pricing for each purchase can really make an impact on your bottom line. Unfortunately, hospitals and health systems miss opportunities for thousands of dollars of savings each day due to variances in pricing and underutilization of group purchasing contracts. Specific items to look at:

  • Total spend per contract.
  • Current versus GPOs’ costs.
  • Standardization status.
  • Product category.
  • Specific tier level applied.
  • Letter of commitment form status.

Evolve Your Value Analysis Committee

Utilizing a cross-functional value analysis team (VAT) of physicians, nurses and supply chain experts offers an essential breadth and depth of perspective that will enhance your supply chain process. This committee is a key factor in helping to manage the never-ending pressure to contain costs and optimize patient care. In order to make best-valued product and service acquisition decisions, a basic VAC should achieve these goals:

  • Integrate the clinicians and supply chain personnel.
  • Standardize on products that are clinically successful.
  • Review objective data criteria and use an evidence-based approach to evaluate new and emerging technology.

 Eliminate Pricing Errors

Up to 35% of healthcare purchase orders contain errors, resulting in overpayments of up to 7%. Resolving these variances consumes valuable time, in addition to $15-$50 per error.

Facilities should look to install a system or work with a software provider that can offer:

  • Master file development and maintenance.
  • Report distribution and analysis.
  • Value report.
  • Customer service.

Benchmark Your Financial Performance

Benchmarking encourages an organization to become open to new methods, ideas, processes and practices to improve effectiveness, efficiency and performance. By benchmarking, you may discover who performs the process best within your own organization or other organizations nationwide. Establish key performance indicators (KPIs) and involve key stakeholders throughout the benchmarking process.

In the pay for performance environment, the key goal for healthcare providers is to deliver data-driven savings through data management and analysis. Providers will need to implement tools and resources, both internally and with the help of external partners, which take disparate organizational data and turn it into workable and actionable information.

To learn more about data analytics and value analysis, click here.

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