Developing a Data-Driven Prioritization Pipeline to Cut Costs and Reduce Variation

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As new payment models take hold and inpatient admissions continue to flatten, hospital executives are feeling ever-mounting pressure to contain costs. This pressure is inevitably passed on to the supply chain leaders who’ve already exhausted the traditional cost-cutting levers and are hard-pressed to uncover additional savings.

Even some of the most forward-thinking health systems struggle to look beyond these traditional savings opportunities. Often, renegotiating vendor contracts leads to a frustrating cycle of reaching for the same low-hanging fruit and realizing only meager savings in the end. Instead, health systems should focus their strategic planning efforts on building a data-driven initiative prioritization pipeline that is purposefully aligned with the organization’s clinical, operational and financial priorities.

Developing a data-driven initiative prioritization pipeline entails systematically analyzing spend and usage information across medical device categories and then developing a strategic work plan for tracking and scheduling actions throughout the year. This kind of shift in planning doesn’t just happen; because the support of both clinical and administrative leaders is needed, it requires a broader cultural realignment within the organization. Below we highlight three collaborative strategies for administrative and clinical leaders.

  • Foster strong physician alignment
    Physicians obviously play a huge role in the selection of devices used to treat patients. They can also be supply chain’s strongest advocate for developing and acting on utilization and sourcing strategies. By nurturing strong clinical leadership and physician champions throughout the organization, health systems can forge deeper partnerships with doctors to address cost and quality of care. Lumere Chief Medical Officer John Cherf, MD, has offered his insights on what health systems can do to forge stronger physician relationships.
  • Use clinical evidence to build understanding across teams
    Physicians tend to perceive supply chain as focused primarily on cost containment and management. Because supply chain doesn’t have access to clinical evidence and research, physicians can rely on clinical arguments to push back on pricing or cost discussions. By providing the supply chain team with access to, and an understanding of, relevant clinical evidence, organizations can establish a common fact base that enables collaboration aligned around patient outcomes and value—not products or price.
  • Uncover opportunities with analytics
    Looking more broadly at savings opportunities requires time-intensive compilation and analysis of disparate data, research and education sources. While supply chain uses multiple tools to aggregate their data, they’ve historically lacked the ability to link clinical evidence to spend and utilization patterns. The right analytical resources do more than just save time; they enable health systems to uncover actionable, evidence-based opportunities within their data to unlock the greatest amount of savings.

Remember that change doesn’t take place overnight, and every journey has a few bumps. But by actively seeking out physician champions, incorporating clinical evidence into device selection discussions and creating transparency into current use patterns, health systems can shift toward a collaborative, data-driven approach that unlocks new value and stronger partnerships.