Facts and figures that highlight key supply chain trends.
Contributed by Access Strategy Partners Inc. April 2023 – The Journal of Healthcare Contracting
By John Strong, Chief Consulting Officer & Co-founder, Access Strategy Partners Inc
>An estimated 3.5 million seniors had difficulty affording medications in 2019. 1
>Why does new medical technology cost so much? In 2023 the “standard fee” for a 510(k) application at the Food and Drug Administration is $19,870, but the cost for Premarket Approval (PMA) and other similar approvals is $441,547.2
>A recent survey of CEOs in hospitals showed that their No. 2 challenge is “financial.” Within financial challenges, most CEOs (89%) reported increasing costs for staff and supplies as most pressing. Now’s the time to treat Supply Chain Management as the strategic advantage it can be!3
32% of the world’s supply of antibiotics is made in China.4
What’s your sourcing plan for 2023 and beyond?
Supply costs per adjusted discharge rose 21% in 2022, according to a report from the Advisory Board Company. Drug costs rose 37% in the same report.5
Health systems are increasingly seeking cross market merger partners, according to Modern Healthcare. More than 50% of 1,500 hospitals targeted by health systems between 2010 and 2019 were located in different commuting zones.6 There are 625 commuting zones in the U.S. Is your supply chain merger-ready?
Orthopedic robotics anyone?
Be prepared for the price tag! $700,000 for some of the most inexpensive to $1 million plus for Stryker’s Mako system.7
Look for more ASCs purchasing these systems as they become the status quo in ortho services.
90% of all purchasing leaders say their strategy for managing and procuring supplies has changed
in the past two years. 72% of hospital purchasing leaders are working closer with suppliers now than two years ago, according to a report from Owens and Minor.8
Is it time for a more collaborative approach to buying?
$56.2B is the expected market value of endoscopy sales in the U.S. by 2030, double the $28.3B in 2020.9
Hospital supply expenses per patient in 2021 rose 31.8% for ICU medical supplies, and 25.9% for respiratory care medical supplies.10
A 2022 Deloitte analysis found that 72% of hospitals have at least one strategy to address social determinants of health and 84.2% of hospitals report screening patients for social needs.11
Supply chain question:
Are you aware of how your suppliers and their subcontractors are dealing with the social needs of their employees? Many contracts have explicit provisions that bar practices such as child labor. Are you enforcing them?
From 300,000 pounds to 150,000 pounds. State and federal agencies have been working with processors to reduce the amount of EtO released into the atmosphere annually between 2011 and 2020.12
About 7 million orthopedic procedures were performed in the U.S. in 2021. 47% were elective.
The market for bioabsorbable implants in the U. S. is expected to grow about 9% annually between 2021 and 2030.13
According to the Kaufman Hall “National Hospital Flash Report” for February 2023, purchased services expenses rose 23% from the same period in 2020.14
1 Keckley, Paul, “The Keckley Report”, February 27, 2023.
2 fda.hhs.gov
3 Becker’s Healthcare Review, January 23, 2023
4 Beckers Healthcare Review “Shot-down Chinese balloon may affect US medical supply chain”, February 15, 2023
5 Advisory Board Company © 2023 “An Industry Under Pressure”
6 Kacik, Alex, “Health systems increasingly seek cross-market merger partners” Modern Healthcare, November 7, 2022
7 Becker’s ASC Review “Robotics in orthopedics isn’t a luxury—it’s a necessity”, February 14, 2023.
8 Owens and Minor, “The State of Hospital Purchasing (Study), Published August, 2022.
9 Strategic Market Research LLP, June 20, 2022
10 American Hospital Association, “Environmental Scan 2023”, © 2023 by American Hospital Association
11
Accenture, Published by American Hospital Association, “4 ways hospitals can reshape their future” AHA Center for Health Innovation, December 13, 2022
12 Modern Healthcare, “A Dirty Business”, September 19, 2022
13 www.databridgemarketresearch.com/reports/us-bioabsorbable-orthopedics-implants-market
14 Kaufman Hall, “National Hospital Flash Report” February 2023 released February 27, 2023