Healthcare organizations across the continuum of care are continually adapting to changing circumstances and large-scale industry trends. These factors affect the delivery of care and hit hard on functions and workflows in the back office, where keeping clinics and facilities supplied while maintaining a healthy bottom line can represent a delicate balance.
It’s a complex task—one estimate by the global management consulting firm McKinsey & Company places the number of unique SKUs for regional health systems at anywhere from 30,000 to 60,000 for clinical supplies.
Purchasing goods, services, and supplies heavily impacts healthcare organizational finances, and everyone from the back office to the c-suite ideally must be in alignment on factors such as vendor and supplier options, regulatory and compliance shifts and updates, new products and technologies, and cost efficiencies in their various markets.
Emerging factors to watch for in the months ahead include:
- Supply Chain Disruptions and Resilience. Turbulence in healthcare purchasing has been unavoidable in recent years. A forward-looking focus on resilience incorporates cultivating a range of supplier options and spotting organizational trends in purchasing patterns to weather such challenges as winter usage spikes and outages.
- Regulatory and Compliance Changes. Across the healthcare industry, regulation and compliance shifts directly impact purchasing. Challenges will emerge from the Centers for Medicare and Medicaid Services (CMS) and the Health Insurance and Portability and Accountability Act (HIPAA) that will directly impact purchasing decisions. Staying out in front of change is crucial.
- Medical Device and Technological Innovation. The healthcare field is a hotbed of innovation, which doesn’t look to change anytime soon. Wearable tech and remote monitoring devices for clients and patients in evolving quickly, along with surgical robotics, artificial intelligence, and virtual reality training for clinicians. New medical devices are also hitting the market across the continuum of care. Staying up on the latest from a purchasing perspective involves getting clinicians what they need at the best possible market prices.
- Continued Digital Innovation. On the patient-facing delivery side, innovations such as electronic health records (EHRs) and telemedicine continue to trend toward near universal adoption. Anticipating the needs that arise from telehealth and other innovations will impact purchasing in terms of tech support rather than traditional supply procurement.
- Sustainability and Green Purchasing. Many healthcare organizations continue to prioritize environmentally sustainable purchasing practices, which means continued focus and education on the purchasing side both to meet internal goals and keep facilities, clinics, and offices running smoothly.
- Value-Based Healthcare. With many healthcare organizations shifting to a value-based care model, purchasing offices will be asked to place more focus than ever on goods and services that promote demonstrably better patient outcomes while providing financial value. (According to Healthcare IT News, “Added pressures of value-based care and cost-effective population health management are forcing healthcare organizational structures to rethink how they utilize data to support and assess their care delivery paradigm.”)
- Pharmaceutical Industry Shifts. Navigating both the costs of pharmaceuticals, the continual introduction of new products, and the regulatory requirements around them is a constant challenge that will not become less complicated in the coming months and years. A prominent example is the shift in the Drug Supply Chain Security Act (DSCSA) compliance in November 2023 which shifts traceability compliance from lot-based to serial-based transactions.
- Acquiring Automated Solutions. The complicated web of factors around purchasing and the procure-to-pay process is increasingly pointing healthcare leaders to automated solutions. Making smart, informed decisions around this process is a must.
Automated Processes and Data Insights Meet the Challenges
of Short- and Long-term Trends
Getting healthcare purchasing right is always a moving target. Challenging trends will always emerge, but there are also opportunities to meet them with clear, data-driven, and proactive tactics and strategies.
In a 2023 McKinsey & Company survey of health system c-suite and supply chain executives, investment in data and analytics capabilities was singled out as the highest priority for investment over the next year.
Today’s healthcare leaders understand that powerful automated solutions bring the back-office out of inefficient paper-based workflows and procedures into visibility, accountability, and the kinds of oversight and cost savings that promote financial well-being and keep operations running smoothly.
Among the valuable functions and capabilities of P2P healthcare automation are:
- Up-to-the-moment inventory transparency across all facilities
- Flexibility in choosing vendors and suppliers
- Simple, easy-to-use purchasing platforms across multiple devices
- Powerful, customizable reports and alerts to power business strategy, inform forecasts, and respond to crises before they happen
- Data-driven contract management and regulatory compliance to drive savings and efficiencies
- Centralized invoices and AP (Accounts Payable) automation to eliminate duplicative spending and late fees
- Strong training and ongoing support to keep things running amid staff turnover and churn.
The trends for 2024 in healthcare purchasing represent both headwinds and opportunities. Back-office staff and c-suite executives alike can capitalize—when they have the data, the visibility, and the flexibility that automated software solutions provide.
Looking to Reduce Your Annual Spend?
Procurement Partners helps customers reduce their annual spend by more than 10% with an easy-to-navigate procure-to-pay solution where users can place orders and process invoices for all suppliers. Procurement Partners is the leading procure-to-pay management system for post-acute, non-acute, and continuum of care providers and has helped organizations achieve 40% time savings and 95% supplier contract compliance through automating the procure-to-pay process.