There are several advantages to implementing/maintaining a Clinical Supply Utilization Management (CSUM) Program, especially when you think you already have everything covered. First, there are always more savings to be had beyond price, but you must know where to look to find these savings, as you have already scooped up all the savings you can from contract pricing. That leaves savings beyond price, which a CSUM Program is designed to find and can also give you insights into your contracting program.
Today, we are going to highlight the advantages of implementing a CSUM Program proactively versus having your back against the wall and trying to pick the next best thing under pressure. Let’s face it, when you are under the gun to reduce costs, things get a little crazy and a good amount of savings are thrown against the wall in hopes that they will stick. That is not good supply chain cost optimization – you need a systematic approach that you can control and strategically manage. That is where CSUM comes in with a multi-fold approach.
Always Keep Your Finger on the Pulse of Your Supply Chain – Things are constantly changing in the healthcare supply chain from new products to new procedures to new doctors to new services to a forever pipeline of contracting changes. How do you know the effect of your changes and whether you need to step in to take corrective action or not? The reality is, you really don’t until your spending is going through the roof and someone six months, a year, or even two years down the road realizes that you are overspending in a particular category. CSUM allows you to have that ongoing pulse for all your major and minor categories of purchase, so nothing takes you by surprise. With the ever-growing list of products being added to your existing product mix, it is better to have your tracking on autopilot.
Know About Things You Could Never Imagine Were Happening – There are areas of savings opportunities that are sitting right in your supply chain, but you don’t know about them even though you have procured all your products at the best possible price. These things are waste, inefficient use patterns, feature-rich products, or not using the product to its full life cycle, thus costing you more in the long run. These are everyday things, but you can’t track these with just spending or pricing – you need to marry your product categories to patient volume centric measures to truly understand what is going on.
Finally Have a Total Cost Measurement System – Every supply chain leader and their CFO will talk to you about the total cost of ownership of the products you buy, which is great, but do you truly have a system that can track that for you? The system to do that is not your budget. The budget will tell you if your Cath Lab is running over budget, but what product categories are we talking about here? You need better answers as well as tracking your true cost of ownership of the products and services you buy on an ongoing basis. This will give you the strategic direction you need to move your value analysis teams to further optimize costs and quality – beyond price. Otherwise, you are just guessing, and there is a lot of wasted time and resources that goes with just guessing. Why leave anything to chance and instead go for sure things with exacting CSUM KPI reporting and benchmarks.
The Name of the Supply Chain Game is Strategic
We have been working with clinical supply utilization for years and have not found a more strategic software tool to use as it tells you where all your savings opportunities reside, plus where you are doing good or not so good. Making strategic decisions on what categories of your supply chain need further optimization and knowing this with certainty is the next level of supply chain leadership that your organization is looking for from you and your team. Certainty of focus for a VA team or supply chain analyst is worth its weight in gold when you know that your CSUM is giving you the next level of savings that you can count on.
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