Under the direction of Matt Pehrson, supply chain at Parallon/HCA Dallas has implemented a pharmacy distribution system. Food and nutrition services is next.
By Laura Thill
For Matthew Pehrson, there’s no question: The success of an organization depends on bringing together the right mix of individuals. For Pehrson, chief executive officer of supply chain services at Parallon/HCA Dallas, this means engaging his IDN’s clinicians in supply chain decisions. “For the first 11 years of my healthcare career, I was engaged in management of clinical operations for two IDNs,” he says. “During this time, I had the privilege of overseeing various clinical operations, from neurosciences to oncology. I also had the opportunity to be the administrator of a 170-bed acute-care hospital. With the knowledge and skills I learned managing clinical operations, I became acutely aware of the significance of how supply chain impacts an organization. When I migrated into supply chain, I was keenly aware of what was important to clinicians when treating their patients,” he continues. “From the operating room to the bedside, my experience working with physicians, nurses and ancillary staff has made me a better supply chain executive; I understand care delivery from their perspective.
“As healthcare reform continues to broaden, expense management has never been so critical in our industry,” he continues. “Understanding clinicians’ work, perspective and needs is vital to ensure costs and clinical outcomes intersect to obtain the most effective care our patients deserve. Without this broad experience, I would not be as effective. I view my clinical operations experience to be a major differentiator in being a better supply chain executive.”
Efficient delivery
Since joining Parallon in 2014 – an organization with 21 acute care facilities and $921,111,617 in annualized spend – Pehrson has assumed oversight of all supply chain services, including purchasing, accounts payable, contracting, medical/surgical and pharmacy distribution/logistics for the North Texas and Central and West Texas Divisions for HCA. Armed with ideas from his organization’s clinicians, he and his supply chain team have made strides in developing a more efficient pharmacy distribution model.
Indeed, Pehrson appreciates being part of an organization that values the role of supply chain in quality and expense management, he notes. HCA’s “laser focus” on supply chain, and how that impacts the quality and expense management of the hospitals it serves, has enabled him and his team to focus on building a pharmacy distribution model aimed at reducing costs and distributing medications to the bedside more efficiently. The model – currently being rolled out across the organization – is built on the low unit of measure concept, which involves picking and filling pharmacy orders for each of the organization’s acute care facilities and distributing medications directly to each unique Pyxis unit. “This allows the organization to buy in bulk at our warehouse, reduce/eliminate core stock at our facilities, and drive down the costs of pharmaceuticals for the organization,” he explains. “I have had the privilege of leading the North Texas Division and opening our first Pharmacy Distribution Center.
“Pharmacy costs have skyrocketed the past several years, and setting up this unique model has been one key driver for HCA to mitigate the cost increase landscape with pharmacy,” Pehrson continues. While he believes the opportunity exists to continue to reduce costs and become more efficient in pharmacy distribution, leading and participating in this project has been a “rewarding and exciting” experience for him. “It’s definitely been a highlight of my career in supply chain,” he adds.
“More opportunities and efficiencies are required of our pharmacy distribution project, which will be on-going for years to come,” says Pehrson. “However, over the next year, I will be working with the North Texas Division to take on the management of Food and Nutrition Services (FANS). Typically, FANS operates on its own in the hospital setting, with limited guidance from – and involvement with – supply chain. We want to change this and align FANS with Supply Chain to optimize our operations across our division. By doing so, we can drive standardization to the provision of FANS, ensure appropriate product utilization, improve patient satisfaction, deliver culinary excellence and reduce our overall dietary expense.” Such accomplishments should enable his team to impact hospital operations by continuing to assist with the organization’s expense management efforts, as well as improving the its HCAHPS scores.
A look ahead
In years to come, Pehrson anticipates the relationship between the hospital supply chain and its suppliers will become more important than ever before. “Contracting with suppliers will continue to evolve as healthcare reform continues to settle into our day-to-day normal operations,” he points out. “I expect to see more partnerships formed between IDNs and suppliers, where value can be demonstrated through collaboration.” As bundled payments become more commonplace, the number of suppliers in the operating room will be limited, drug formularies will be more restrictive, and committed supply portfolios will become the norm, he says. Providers and suppliers will have to be agile to navigate through these changes.
“At HCA, we will forge our contracting relationships [more deeply] through our partnership with HealthTrust, driving supply formularies to navigate these changes,” says Pehrson. In doing so, his supply chain team will continue to look for suppliers it can trust will help drive value to HCA’s patients. “Partnerships are forged with open, candid relationships, where both parties can align incentives and efficiencies so that ultimately we can provide excellent care to our patients,” he says. “While I understand this is a broad statement, it cannot be ignored. When partnering with suppliers, we must understand each other’s incentives and needs, so that true partnerships can be developed.” Supplier partners must be willing to collaborate with supply chain, rather than taking actions that lead to conflict between supply chain and their clinicians and physicians, he adds.
Prior to joining Parallon, supply chain CEO Matthew Pehrson served as vice president of supply chain and resource management at Presbyterian Healthcare Services, in Albuquerque, N.M. At Presbyterian, he filled many roles, including that of administrator of Presbyterian Kaseman Hospital and the service line administrator for oncology services.
Today, he serves on the Supply Chain Advisory Board for HealthTrust and is an active member in the American College of Healthcare Executives and the Association for Healthcare Resource and Materials Management.
