A faith-based health system operates PPE manufacturing. | So Good News

OSF HealthCare brings protective mask manufacturing to its network of 15 hospitals and jobs for the local community.

For OSF HealthCare; The pandemic has brought opportunities for self-sufficiency and greater digital transformation. Certain factors arise, such as centralized drug distribution, when the distributor closes the shop without warning. But other factors, such as manufacturing personal protective equipment (PPE) and increasing supply chain visibility through digitalization, may not help the immediate situation but address resilience going forward.

OSF HealthCare is now one of the few direct health systems in the industry. Production of PPE. Early nationwide outages prompted Pinak Shah, OSF HealthCare’s senior vice president and chief supply chain officer, to bring jobs to the health system’s local community and bring manufacturing in-house. “Peoria is an engineering town, and with Caterpillar and others, we saw an opportunity for manufacturing,” Shah said.

Focus on the supply chain: making masks and other PPE.

In the spring of 2021, the health system imported machinery to make masks, and in February 2022, it imported more to make N95 masks. The masks recently received FDA approval to sell them, and Shah hopes to get approval for N95 masks soon. The FDA has allowed the masks to be used internally under an Emergency Use Authorization until the health system receives final FDA approval.

“Everyone struggled during the lockdown,” Shah said. Prices were sky high along with airfares. “That’s where the ROI comes in.” OSF HealthCare currently operates one production shift, producing 5 million surgical masks annually, of which 3 to 3.5 million are used. It plans to sell the initial surplus through its members. Pointcore Supply Chain Services Economy. They can add a second shift to produce more masks.

It took 12 to 18 months to design the machinery and begin production. “For the community, it’s a boost,” Shah said. The Peoria manufacturing facility is in an economically challenging area and offers a training program. OSF HealthCare provides capital and raw materials, and the facility provides property and labor.

OSF HealthCare became a shareholder in isolation gown manufacturing. Premier and DeRoyal. On the pharma side, it invested in OSF HealthCare. Exela Pharma Serviceswith Premier to mitigate the risks of drug shortages and bring pharmaceutical manufacturing inland

Peoria, Headquartered in Illinois, the faith-based health system includes 15 hospitals (10 acute care and five critical access) and has more than 2,000 beds. There are more than 400 clinics in Illinois and Michigan. OSF HealthCare supply chain spends nearly $1 billion; purchase, contract A new distribution center serving the analytics and hospital system as a whole is deployed.

OSF HealthCare owns Pointcore with several healthcare businesses. Some businesses are involved in its construction. Despite being profitable, including buildings and IT services. A supply chain business is not a business that makes money. “On the supply chain side, we’re reducing costs by mass,” says Shah. Pointcore Supply Chain offers regional contracting services and is an authorized reseller of Premier’s enterprise resource platform (ERP) system.

Pinak Shah, OSF HealthCare’s senior vice president and chief supply chain officer. Photo courtesy of OSF HealthCare.

A new focus on pharmaceutical and pharmaceutical/surgical distribution

Since 2019, OSF HealthCare has operated an integrated distribution center (IDC) for medical/surgical supplies. It is now centralizing all pharmacies for its integrated delivery network (IDN). During the epidemic, Pharmaceutical distributor OSF HealthCare has filed for bankruptcy protection and used it for closing physician offices. “We had to deliver the entire pharmacy distribution center to IDC in three weeks,” Shah said.

The IDC pharmacy will be rolled out in December and all hospital pharmacies will be centralized there. OSF HealthCare will begin specialty pharmacy operations in 2023. It will run the health system’s durable medical equipment (DME) project for supplies to patients’ homes. In the past, there was a separate building.

Finally, OSF HealthCare will retain all distribution and transportation, including transportation and logistics services, and move to total logistics management within a few years. This will make delivery more efficient and reduce freight and delivery costs.

Digital projects

In the past few years, The OSF HealthCare supply chain team created “digital towers” to capture supply chain signals and use automation to handle them. The pandemic is causing product shortages, not PPE. “We need to spend a lot of time with clinics to make sure we’re getting the right products, so we’re taking care of our patients,” said Matt McGraw, OSF HealthCare’s vice president of supply chain procurement.

The first application they are developing is a product compliance tower. “In the past, we spent hours queuing up and analyzing data to determine if we were using this widget, but we should be using it,” he said. The new digital application pulls product data from hospitals in real-time and helps them see if the wrong items are showing up at their hospitals. no If they show up in a timely manner, they will be able to “find a needle in a haystack instead of spending a lot of time. McGraw said

Although this system has not been in place for a long time to share data. They are not looking for hard dollar labor savings. Instead, They expect savings in faster product conversions. When the system changes from one product to another, it allows them to view the inventory dates on hand so that they can accurately determine the change date. As a result, they can save on those costs if they can make that conversion faster.

The second tower in development is a Periodic Automated Replenishment (PAR) digital application that will be used at the hospital floor level to restock supplies in the warehouse. Rather than counting items in each supply room daily, the PAR system will make real-time quantity adjustments so they need to be restocked more often. This will save labor costs. The tower is still under construction and will be operational by 2023.

A third digital OSF HealthCare project is computerized reading of purchase orders that arrive via email or fax. While this has traditionally been done manually, the supply chain team is turning it into a machine learning process. The computer will read the emails and confirm when the product arrives.

Practical integration and standardization in the supply chain.

With healthcare costs so high right now, from labor to products; The main focus of the supply chain is to keep costs down to current levels or at least inflation. Both Pointcore and OSF HealthCare are trying to lower prices through consolidation. Most likely it is single source or dual source. They plan to commit 90% to 95% of their inventory to single-source products. They are looking for pricing changes and benchmarking with Premier’s Service Line Analytics tool.

The OSF HealthCare Clinical Integration Team meets weekly. Traditionally, This team is comprised of clinical and business-focused nurses who interface with the OSF HealthCare business side. “We’ve strengthened this team in the last two months by adding a full-time physician to the team,” McGraw said. He thinks this will help peer-to-peer surgeon conversations to reduce product variation.

OSF HealthCare is also transitioning from using value analysis teams at each of its 15 hospitals to having a value analysis team at the overall ministry level. “I think a recession is coming, and we need to prepare,” Shah said.