Supply Chain Resilience: Lessons Learned from Recent Healthcare Challenges

The field of healthcare has seen its fair share of challenges in recent years. The system faces staffing shortages, rising costs, and the pressing need for system modernization amid financial difficulties. Healthcare is also adversely affected by larger economic trends like rising inflation.

To combat these challenges, a resilient supply chain is critical. In this blog, we’ll cover the challenges the healthcare industry faces and how responsive, adaptable supply chains, proactive measures, and strategic partnerships with Group Purchasing Organizations (GPOs) contribute to stability, cost-effectiveness, and improved healthcare outcomes for all.

Healthcare Industry Challenges

Because the healthcare sector must respond to patients’ needs in real time, there’s often a lag time between the type of care needed and the type of care provided. These effects are complex and far reaching, with consequences sometimes rippling far into the future. A few of the most recent crises impacting healthcare include:

  • Global pandemics: Outbreaks like the COVID-19 pandemic placed extreme stress on healthcare supply chains, leading to widespread supply shortages and steep price increases that continue to impact patients and providers alike.
  • Natural disasters: Often unpredictable and catastrophic, natural disasters like snowstorms or hurricanes can damage infrastructure and block roads, disrupting transportation and halting the delivery of much-needed medical supplies.
  • Increased demand for medical supplies: An aging population, material scarcity, and disparate sectors competing for technological resources contribute to an increased demand for medical supplies—further raising costs and straining supply chains.

Importance of a Resilient Supply Chain

A resilient supply chain can be defined as strong, reliable, and responsive to changes. Resilient supply chains allow for rapid crisis management and quick deployment of medical supplies in the face of natural disasters and other challenges. When supply chains are disrupted, the impact can be disastrous and long-lasting. Poor supply chain management affects patients especially, resulting in delays to critical care and increased healthcare costs.

In the face of such far-reaching issues, proactive measures are a must. In contrast to a reactive supply chain, a proactive supply chain addresses potential disruptions and gaps in visibility before they arise, rather than after. This level of flexibility allows suppliers to adapt quickly to unpredictable changes, with protective measures and forward-thinking fail safes in place to ensure medical supplies are still delivered in emergency situations.

Role of Group Purchasing Organizations (GPOs)

Group Purchasing Organizations (GPOs) play a crucial role in enhancing supply chain resiliency. These entities, formed by healthcare providers to leverage collective purchasing power, contribute significantly to the efficiency and stability of the supply chain—reducing supply costs by up to 13%. Through membership with GPOs, healthcare organizations can adopt more strategic procurement approaches, benefiting from economies of scale and negotiating power.

GPOs streamline the procurement process by aggregating the purchasing needs of multiple healthcare entities, fostering collaboration among stakeholders. This collective approach not only ensures a stable supply chain but also promotes cost-effectiveness, as GPOs negotiate favorable terms with suppliers on behalf of their members.

By centralizing procurement activities, GPOs enable healthcare providers to focus on their core functions, enhance resource allocation, and ultimately improve patient care. GPOs serve as integral facilitators in fortifying the healthcare supply chain, fostering collaboration, and optimizing procurement strategies for the benefit of the industry at large.

SourceMark’s Contributions to Healthcare Resilience

SourceMark is committed to ensuring our supply chain remains steady and reliable, especially in times of crisis. For over 20 years, SourceMark has acted as master supplier to over 3,000 clients including hospitals, health systems, pharmacies, and physician offices throughout the United States. As a recognized leader in providing innovative solutions, SourceMark has set precedent and led the way when it comes to protecting against risk and disruption. To address challenges to supply chain resilience, SourceMark has taken several proactive measures, including:

  • Strategic partnerships with GPOs: SourceMark teams with leading GPOs to bridge the gap between the operational and clinical sides of healthcare, reliably delivering patient-centric products while ensuring they remain accessible and affordable for patients.
  • Technology-driven solutions: Our products are driven by innovation. We aim to increase efficiency, accuracy, and optimization, allowing for streamlined inventory management and quicker delivery of essential medical supplies.
  • Advanced Demand Planning:  SourceMark prioritizes clients with advanced demand planning, dedicating inventory to committed clients and allocating 50-80% of historical usage. This enables staff to focus on patient care, not supply availability.

Insights and Best Practices

In our ever-evolving healthcare landscape, challenges like COVID-19, rising costs, and unprecedented staffing shortages have underscored the critical importance of resilient supply chains. These challenges highlight the need for healthcare organizations to prioritize flexibility, diversification, and agility in their supply chain strategies.

To mitigate the impact of unforeseen disruptions, healthcare organizations should leverage strong partnerships with suppliers, maintain strategic stockpiles of essential medical supplies, and leverage advanced technologies including real-time tracking systems, predictive analytics, and automation.

Collaboration is key, internally and externally through partnerships with GPOs and other stakeholders. These collaborations foster a collective approach to problem-solving, resource sharing, and risk mitigation. Information sharing, transparency, and open communication within the supply chain network are crucial for building resilience. Healthcare organizations can navigate uncertainties more effectively by implementing these insights and best practices, ensuring a robust and adaptable supply chain that can withstand challenges and safeguard patient care.

The imperative of resilient supply chains in healthcare cannot be overstated—particularly in the face of challenges like global pandemics, natural disasters, and increasing demand for medical supplies. SourceMark, with over 20 years of commitment to healthcare resilience, stands at the forefront by fortifying our supply chain against risk and disruption. Through strategic partnerships with GPOs, innovative technology-driven solutions, and a dedication to advanced demand planning, SourceMark has consistently demonstrated its leadership in the field.

We invite you to explore SourceMark’s contributions and discover how our proactive measures and collaborative approach reinforce the healthcare supply chain, making it more resilient and adaptable to disruption and the ever-evolving needs of patients. Get in touch with us for more information about our innovative solutions.