D-H’s Supply Chain: Helping Employees Purchase Equipment, Supplies and Service Contracts
“Help me, help you,” Tom Cruise famously said in the film “Jerry Maguire.” This line could just as easily be said by a member of D-H’s Supply Chain team when talking to a D-HH employee considering a departmental purchase. The Supply Chain Division helps employees buy the equipment, supplies and service contracts they need at the best possible value. This cost savings work is especially crucial for D-HH; the system spends more than $500 million annually on supplies and services and New Hampshire hospitals receive one of the lowest government reimbursements in the country.
The Supply Chain Division is made up of nine departments—Purchasing, Supply Chain Technology, Printing Services, Inventory & Logistics, Patient and Equipment Transportation and Linen Services, Sourcing, Clinical Quality Value Analysis, Contracting and Purchasing. When an employee wants to purchase or contract for something, they should reach out to the appropriate Supply Chain department, says Supply Chain Vice President Curtis Lancaster. “We will then collect the different options, similar to what travel and hotel websites like Expedia.com or Trivago do, so an employee can make the appropriate selection and get the best possible value,” says Lancaster. As an example, Supply Chain helps to evaluate and negotiate consultant, maintenance and supply agreements.
“Because of our visibility of purchases across the system we are able to consolidate those purchases to get the best value across the D-HH System. If employees deal directly with vendors and don’t use us, the vendor may tell them this is the best deal they’ve offered anyone, and rarely that's the case,” says Lancaster. “By leveraging buying power, reputation and using benchmarking we can get you the best price. We also have insight into upcoming technology changes and company mergers that can impact the flow of products and ensure that we always have access to the latest technology at the best value.”
The departments of Sourcing, Clinical Quality Value Analysis, Contracting and Purchasing can help employees with:
- Identifying customer specifications for products.
- Reviewing current vendor contracts.
- Obtaining quotes.
- Supporting product trials and evaluations.
- Reviewing market share and clinical research.
- Aligning products throughout the system.
- Benchmarking pricing proposals through multiple benchmarking tools.
- Negotiating pricing and contract terms.
- Procuring products.
To benefit from the maximum purchasing power, Director of Clinical Quality Value Analysis Krista Merrihew recommends contacting Supply Chain early in the purchasing process.
Contracting is looking at the fine print of the contract, negotiating pricing and getting you more for the same amount of money “Contact your sourcing specialist or Clinical Quality Value Analysis as soon as you are thinking about a new product purchase or replacement,” says Merrihew. “Contracting will review the fine print of contracts, negotiate pricing and get you more value for the same amount of money. When employees don’t use our service, we pay more for the items we buy and put the organization at risk.”
To speed up the purchasing process and help employees track their requests, D-H recently introduced Lumere, an intranet workflow tool for new product and capital requests. Lumere also allows access to research studies, functionally similar products and the Food and Drug Administration (FDA) product information (including adverse events). “This workflow tool also helps us make sure we’re connecting all the dots because it gets input and information from all the stakeholders, such as Facilities,” says Merrihew. “This will help us prevent cases where products are ordered without input from one of our sourcing specialists and the department later finds out the product can’t be used because the wiring isn’t compatible with our rooms. And then we can’t return these items and have wasted thousands of dollars.”
In addition to Lumere, Supply Chain this past summer launched a software program called MediTract to track D-HH contracts for services like elevator repairs. “We want employees to put their contract requests into MediTract so that when regulatory requests come in, such as Finance needing to know all of the leases that exist in the organization, then we have a library of this information and can quickly access it,” says Lancaster.
Lancaster notes that having standardized products and services helps ensure that D-HH is paying a fair price and limits variation between sites for both clinicians and patients to provide a standard of care and safe product use across the D-HH system.