There is vast room for improvement concerning the efficiency of healthcare supply chain management, or the process of making, distributing and providing healthcare essentials such as pharmaceuticals, supplies and devices. However, due to the cost of the technology upgrades necessary to bring about such improvements, many hospitals remain tethered to siloed legacy systems, which require lengthy, manual processes that prevent those involved in the supply chain—manufacturers, distributors, and providers—from raising the performance bar.
This also prevents hospitals from seeing significant cost savings. According to Bruce Johnson, CEO of healthcare supply chain management organization GHX, $5 billion is lost annually in the healthcare supply chain due to such things as waste, inefficiency and lack of visibility.
Despite the damaging financial effects of poor supply chain management, governments and insurance payers are continually working to cut budgets, making costs one of the top challenges preventing hospitals from improving their supply chain workflows. In fact, “financial challenges” was listed as the top concern by hospital CEOs in a new survey conducted by the American College of Healthcare Executives.
While it’s clear that hospitals struggle to fully modernize their legacy systems due to finances, they can start small by integrating business process automation into their existing solutions, enabling them to capitalize on impactful, cost-saving benefits such as:
- Reduced supply chain costs in the form of improved product selection and distribution, and an increase in overall supply chain efficiency.
- Enhanced daily workflows and processes that lead to reduced patient wait times, accelerated billing cycles and reduced hospital readmission rates, among other improvements. Furthermore, hospitals can automate their electronic health record (EHR) systems, eliminating manual, error-filled data entries that can lead to higher costs down the road.
- Automated and accelerated patient service; for example, consider a hospital that creates an electronic form for patients to fill out online before they arrive, decreasing patient wait times and ensuring all necessary information is gathered. Said patient information can then be automatically input into the hospital’s EHR system, where the hospital’s insurance carrier can then be notified of the new fees awaiting approval.
Although automation enables hospitals to manage their supply chains and daily processes in a way that significantly improves their bottom line, the capital and payroll required can still be too expensive for hospitals, returning healthcare execs back to square one.
Yet, it doesn’t have to be this way. Hospitals don’t have to be confined by finances to fragmented, cost-draining supply chain processes when they partner with a trusted IT vendor. Research shows that hospitals are increasingly outsourcing operations, like lab and clinical services, to strategic IT partners to fully optimize their budgets. In fact, the global healthcare IT outsourcing market is estimated to be worth $50.4 billion by 2018, driven by greater demand among hospitals and insurance payers to automate patient care processes and track billing and medical data.
Outsourcing business process automation enables hospital execs to keep up with the changing, fast-paced demands of the healthcare industry—all while ensuring they meet compliance regulations—and at a price point that satisfies their budgetary requirements.
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