Value analysis and purchased services? Yes.

Purchased services seem to be getting more attention in supply chain circles today. The question is, can the principles of value analysis, technology assessment, and other product-selection techniques apply to services such as landscaping, equipment maintenance, and environmental services?

 

The answer is yes, according to those with whom JHC spoke. But the provider must be able to define its expectations to potential suppliers, measure whether those expectations are being met, and then work with the supplier if actual performance falls short. Tom Lubotsky, vice president supply chain, clinical resource management, Advocate Healthcare, Oak Brook, Ill, calls it shared accountability. To the supplier, the IDN says, “If I contract with you, I want to make sure you won’t simply hand off your services to me,” he says. “I want to make sure you’ll be in my space.”

 

And it’s definitely worth the effort, points out Cindy Christofanelli, RN, MSN, CMRP, corporate director supply chain management, SSM Health Care, St. Louis, Mo., and chair of the Association of Healthcare Value Analysis Professionals committee on value analysis professional practice standards. “In some cases, purchased services actually equal or exceed the total spend for supplies and clinical equipment, but they often don’t get the same level of scrutiny,” she says. Oftentimes, even within the same healthcare organization, different departments or facilities might be paying different prices for the same services. And in many cases, end users aren’t challenged to define what they really need rather than what they want from potential service providers.

 

Providers often lack another valuable tool when it comes to evaluating and selecting suppliers of purchased services, points out Christofanelli. “There’s no clear methodology or easy access to benchmarking data on pricing across the nation,” she says.

 

Traditionally, purchased services have fallen outside the auspices of the supply chain, she points out. “But I see the supply chain getting more and more involved in these initiatives and applying the same fundamental processes that we have applied in clinical and non-clinical supply costs.

 

“I think healthcare organizations will reap similar results from taking purchased-services categories through the same due diligence and applying the same value analysis processes and steps to these types of contracts and agreements.”