What materials management professional doesn’t know the difficulty of gaining the trust and confidence of a busy clinical staff? Now take that clinical staff and scatter it among, say, 400 locations.
That’s the challenge facing Phyllis McCready, vice president and chief procurement officer, Northwell Health (formerly North Shore Long Island Jewish Health System). It is a challenge similar to that facing many materials and supply chain executives today, as their IDNs acquire or enter into joint ventures with physician practices.
“They’re very open to learning about the supply chain,” says McCready, speaking about the typical physician office staff. “But they need the tools to manage it.” Most often, those tools come in the form of data about products, usage and cost.
“How do we help physicians evolve from being in control of their practices for years and making their own product decisions, to convincing them that through standardization, we can not only help their practice, but all of our practices?” she asks.
“It’s not just a matter of selling them on a product. It’s selling them on the quality of the product and selling them on the logistics [of getting the products to the practice]. It’s offering an overall solution to a problem they have. We’re able to show them what we can do in supply chain, and I think they’re impressed by what we can do for them if we work together.”
Opportunity
McCready started her career in materials management as a college student 30 years ago in a small community hospital. She was already working at Long Island Jewish Medical Center when it merged with North Shore Health System in 1998 to form the IDN. Today McCready works with clinicians and materials professionals in each of the IDN’s 21 (and soon to be 22) acute-care hospitals, and she is expanding her oversight into the IDN’s ambulatory practices. She also serves as chief executive officer of the North Shore-LIJ Alliance, a local group purchasing organization that supports the purchasing operations for all of Northwell Health.
Today, McCready and her team manage more than 82,000 SKUs for the health system, some 7,000 contracts, and about $2.6 billion in spend.
Even though the purchasing budget for the 21 acute-care hospitals far exceeds that of the physician offices, McCready takes seriously the need for – and opportunity to – lower costs among the latter. And she feels she is in a good position to do just that.
“I’ve always felt that my connection in healthcare has been to the clinician, whether it be nurses, physicians or someone else,” she says. “And it’s very rewarding to get to know the physicians better.”
Meet and greet
The challenge for supply chain executives is staying in front of the physician-office acquisitions, and getting out and meeting those in the practices as soon as they come onboard, to learn their needs and engage them in the supply chain process.
“Physicians are open to change, but their focus is on their patients and the quality of their services first and foremost,” says McCready. “So how do we help them improve the quality of their patient care while managing their bottom line better, and what tools can we show them?”
Henry Schein Medical plays a strong supporting role in that task, she says. And after Northwell Health and the distributor sign a contact (expected soon), Henry Schein will play an even more vital role in the future. For example, the distributor has placed one of its regional account managers – Ashley Brangers – onsite to coordinate and focus solely on supply chain’s interaction with the physician practices.
Henry Schein as partner
The distributor will work with the IDN supply chain team and the service line leaders in 2016 to develop a portfolio or formulary of products for use in the physician offices. And Henry Schein will service all of the physician practices in low-unit-of-measure from its own facility. Although Northwell Health services its acute-care facilities from its own Integrated Distribution Center, or IDC, which it opened in Bethpage, N.Y. in 2011, it is looking to partner with Henry Schein to service the 400+ physician locations that comprise its ambulatory network.
Henry Schein is also expected to play a key role in outfitting new or recently acquired practices, as it has done with Northwell Health’s urgent care centers. Already, the distributor has proven its value in linking Northwell Health practices with key manufacturers, such as Welch Allyn and Midmark. “Henry Schein gets people talking to each other, to make sure they get the right equipment for their practice, and to help us standardize throughout the system,” says McCready.
Perhaps one of the distributor’s most valuable deliverables (after a final contract is signed) will be providing the IDN with quantifiable information about product usage, cost and performance. With data, McCready and her team can manage the system-wide supply chain from a corporate level. For example, they can identify products coming off of formulary; or if one practice encounters a problem with a product, the supply chain team can alert all others.
“Analytics are critical to support our needs,” McCready says. “The fact that we will have someone here full-time to help us understand and document our usage and savings is critical.”