How to Use Data to Achieve a Clinically Integrated Supply Chain



Debbie Schuhardt, MHA, FACHE, Principal, Clinical Advisory Solutions

Clinical-supply integration (CSI) centers on ensuring that supply and device decisions reside with physicians and provides a vehicle to drive out unwarranted clinical variation. To do this, physicians must be informed by verified, accurate data. And, though data alone cannot integrate your supply chain, you cannot clinically integrate your supply chain without it. That’s because it’s the foundation of CSI and also the driver that sustains it. The keys to CSI success involve sharing reliable information in a meaningful, actionable way and having a structure that places physicians in a position to take action. I realize that’s easy to say but not so easy to do. Here’s how it can work.

First, your data needs to be accurate and credible. Likewise, presentation of data should be transparent and verifiable. For example, there’s a difference between being able to show a physician the cost of her implant on an actual vendor invoice and trying to explain that her cost is a reflection of the hospital’s cost-to-charge ratio. That’s why you need to present the material in a way that speaks to your clinical audience.

Using data to tell the story

If you want to change physician behavior, then you need to provide data that’s relatable to them. A “data dump” is neither manageable nor meaningful. You need to provide more than the cost of devices and supplies. You will want to link the physician, patient and outcome data in a storyline that shows the economic and clinical impacts of a physician’s decisions. In this way, both the cost of devices and supplies as well as unwarranted clinical variation can be addressed.

Let’s take that same clinician with the implant. You could show her the cost of the devices and supplies she uses in comparison to other physicians. In doing so, she’ll have a better understanding of where she stands related to her peers from a cost perspective. That’s good, but better yet, expand the story. Show her how much her selections impact her overall cost for the procedure, the financial impact she has, and her outcomes. What is the best way to share? Provide her the total economic and clinical perspectives in relation to her internal and external peer groups.

Determining an accountability structure

Data shared in a vacuum without the ability to hold people accountable is often a fruitless activity. It may start out well, but a lack of structure often leads to a lack of focus and priority. Who hasn’t had a project that began with a lot of momentum, only to see it drag on or fizzle out completely? Structure and governance empower people and hold them accountable in ways that are visible, tangible and culturally aligned. Organizationally, structure and governance are a strategic commitment to processes and outcomes that are supported by executives. 

There are formal and informal arrangements of structure, and both support physician engagement. Co-management agreements, directorships, gainsharing, employment and other types of contractual relationships are examples of formal arrangements. Informal arrangements tend to rely more on good citizenship and can be very effective, sometimes even more effective than formal arrangements. Structures themselves can also vary, from less complicated episodic governance for specific projects to more complex structures including service lines, performance improvement programs and complex governance related to value analysis.

A focus on service line structure

Let’s look closer at the service line structure. It provides an ideal forum to transform a cost-reduction opportunity that’s typically seen as a supply chain project, into one that’s driven by clinicians. Service lines are strategic structures that integrate care across the continuum around a specialty, medical condition or population. Service lines strive to provide patient-centered, cost-effective care with superior outcomes. Often led by both physicians and administrators, service line structures support and require physician direction and decision-making, particularly around clinical issues including use of supplies and devices, and unwarranted clinical variation. This dyad is ultimately responsible for the economic and clinical success of the service line. As a result, you’re more likely to find accountability, visibility, priority and alignment across an organization that utilizes a service line structure.

Service lines are more likely to have access to financial data and physician-level case data, making it easier to evaluate the clinical and financial performance of their programs. In other words, this structure provides a way to obtain relatable data and then transform it into a story that is meaningful to physicians. Not surprisingly, reducing cost is typically one focus of this structure, and service line leaders often have cost reduction goals, frequently at the cost-per-case level. The ability to marry cost and physician-level case data with a structure that promotes responsibility and accountability, can make service lines an integral part of achieving CSI.

For organizations that do not have service lines or other formal structures in place, episodic governance is a good option. It requires executive support and active participation to establish project priorities and to appropriately resource them. Episodic governance needs physician leadership or a champion to guide and direct clinical decision-making, and it requires accurate, credible data delivered in a meaningful and actionable manner. Over time, as more and more projects are executed in this way, a structure will most likely evolve that stands on its own and fosters clinical integration of your supply chain.

Clinical-supply integration is designed to ensure that device and supply decisions reside with physicians and to drive out unwarranted clinical variation. To accomplish this, physicians must be informed by actual costs, followed by an understanding of how their device and supply decisions impact cost and quality. When a supply chain is clinically integrated, an overarching structure, either formal or informal, connects data from a physician and case or procedure data with clinical and financial outcomes. The results are lower costs and higher quality, two benefits worth the efforts of clinically integrating your supply chain.

About the author. In her current role, Debbie Schuhardt leads the service line optimization team at Vizient, where she helps health care organizations drive changes that improve service line performance. A Fellow of the American College of Healthcare Executives, Schuhardt’s breadth of experience includes change management, service line development and management, supply chain improvement specifically in the areas of orthopedics and spine, utilization management, performance improvement, ambulatory care, physician practice management, women’s services, oncology, and training and mentoring.

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