I often hear Supply Chain and Value Analysis Professionals saying that their Value Analysis Program is very mature. This is great to hear but what does that actually mean? Having been in the healthcare value analysis world now for over 32 years, I know there is a bit of subjectivity that comes with that maturity statement. I want to bring you clarity and assist you with your goals and objectives for your program moving forward. The key here is that even though you have reached a high level of maturity you will still want to push the envelope further in a quality and cost centric way to ensure that your Value Analysis Program does not just become a redundant “have to do” every month.
Below are some advanced strategies that you can use to move your Value Analysis Program forward.
Advanced Strategies for Your Value Analysis Program
Trust but Verify with Savings Validation – Most organizations handle their projects and then move on to the next new product request, recall issue, contract conversion, or value analysis initiative. What is often forgotten is that there is a before, during, and after effect that normally is never tracked. Tracking what happens after is vital to tell you exactly what results you have achieved versus just the projected outcome that you documented on the table. Did you reduce your Davinci robot supply expense costs by 33% per case or not? This would not be just a spend tracking either, it would be a patient volume metric. In the case of the Davinci robot, this would be DaVinci robot cost per case.
The bottom line here is that there is a projected result and then there is the actual result. What is more important to know in this cost-conscious age? You need to know the exact increase/decrease in order to ascertain whether your value analysis project met expectations or if you need to go back and do a little review/rework to figure out why it did not happen and then make it happen.
You Always Need to Know Which Way the Wind is Blowing – Integrating clinical supply utilization management (CSUM) is about going beyond contract price and standardization and looking at your total cost using a patient volume metric comparison. For instance, cost per surgical case on sutures, cost per cath lab case on stents, cost per adjusted patient day on IV sets, and all of your major and minor categories. This will let you know which way the wind is blowing by running just a few reports like year over year, three-year average, or 6-quarter historical best practice. Quite simply, every organization has optimized their contracting and standardization. What is missing is when things happen that you don’t realize are happening, like when an organization’s cost per surgical case on surgical energy products increased from $32.20 per case to $55.55 per case or a 43% increase in the current fiscal year as compared to the previous.
On average, 65% of all of your product categories are fine. The other 25% to 35% are the ones you need to be aware of or they will sneak up on you later.
Train Your People in Advanced Methods – Last on my list is something that is totally overlooked at 98% of healthcare organizations and that is training of value analysis teams. Millions of dollars go through these teams every year and the expectations are always on the rise, but we forget that in order to up the bar for results from our teams, we must give them the advances skills they need to take it up a notch. Training must be focused and on point so that it will keep everyone on the same page while taking them to a new level of savings you never thought was possible before.
I could go on and on with this list as there are many areas that would be considered advanced for your mature value analysis program. Keep in mind that even if you have reached a high level of operation, you can still seek out new best practices, tools, strategies, and methods to make your program even better. The worst thing for any value analysis team is to deem your team “mature” and thus do nothing further thinking you are leading the field when perhaps there is still much more that you can do. It is better to keep pushing the envelope than to do nothing!
Below are some similar articles that you may find interesting.
5 Easy Steps to Integrating Advanced Savings into Your Value Analysis Program
Healthcare Supply Chain: 3 Simple Ways to Save Majorly and Not Create a Bunch of Work Doing It
3 Reasons Why You Should Be Taking Advantage of Value Analysis Strategic Planning