The Healthcare Matters Category

U.S. Healthcare Needs Private Equity

The Wall Street Journal is reporting this week that two major hospital systems, Ascension and Providence St. Joseph Health, are in merger talks. If the deal goes through, the combined entity would include nearly 200 hospitals across 27 states with annual revenues of about $45 billion. The combination would surpass the current largest U.S. for-profit hospital operator, Nashville-based HCA Healthcare. Proponents of the deal say the move could add supply chain efficiencies, eliminate operational redundancies and reduce unnecessary spending.

The Specter of Amazon Rx

Shares of Rite-Aid and CVS initially plummeted on rumors of Amazon’s possible move into pharmacy. Surprisingly, however, their stocks prices have recovered of late, trading places with major medical distribution companies McKesson and Cardinal Health. With rumors of Amazon lurking, it was apparently their turn, as McKesson and Cardinal share prices have recently hit the skids. First grocery, an $800 billion business, then drugs, about a $500 billion business, and now medical products?

Old-Fashioned Heuristics: Common Sense Cause and Effect

Regarding the countless examples of reckless government spending we like to mock, I stopped caring a long time ago. Instead, I have turned my attention to the funding of studies designed to confirm things that we should have already known. If you have a sense of humor, there are numerous ridiculous examples where taxpayer money might have been invested more judiciously. Spending more than a billion to confirm that the use of seat belts saves lives comes to mind, as does funding a long-term study to determine whether obligatory handwashing might be a good idea in health care settings. Studying hospital behavior to determine if they might be playing self-serving games with the current reimbursement calculus also strikes a chord.

More on Healthcare’s Saline Bag “Shortage”

The saline bag “shortage” in healthcare has been going on for a few years. I’ve got some strong opinions on the matter, as I have had the pleasure of interviewing the assigned category managers at the nation’s largest healthcare GPOs, health system sourcing professionals and executives at Baxter, B.Braun and Hospira, the nation’s three largest manufacturers and suppliers of the product. It turns out that there are very few resin producers that make the type and grade used to manufacture saline bags. Not only did these producers cut production, but they’ve increased their pricing by more than 300% in the last year. Why?

The Latest Worst Kept Secret: Amazon’s Move into Pharmacy

“I think Amazon getting into the PBM business (pharmacy benefits management) is a bunch of B.S.,” said Vishnu Lekraj, an analyst with analyst firm Morningstar. “I don’t understand how a company that can ship goods to a consumer can take over every single industry.” According to state pharmaceutical boards, Amazon has received approval for wholesale pharmacy licenses in at least 12 states: Arizona, North Dakota, Nevada, Alabama, New Jersey, Michigan, Louisiana, Connecticut, Idaho, New Hampshire, Tennessee and Oregon, with applications pending in other states. In fact, some of the license types go beyond prescription drugs and include approvals for products and devices that fall under the durable medical products category, such as oxygen and other medical gasses.

Can the Latest Supplier Relationship Management Tools Deliver the Clinically Integrated Supply Chain?

On healthcare’s supply side, you’ll meet some of the most sophisticated procurement practitioners you’ll find across industry. On the buy side, talking specifically now about acute care providers, however, you have a group that has carried the reputation of “laggard” for as long as anyone has paid attention.

Take it From a Former Road Warrior: User Conferences Have Come of Age

Eved

Having spent more than 30 years in the software game, I thought I had reached my fill of trade shows and all of the related logistical nightmares. For years, user conferences were saddled with similar baggage (sheep in wolves’ clothing). But not anymore — at least not based on my experience of the last few years. Done well, user conferences bring customers and qualified prospects together in increasingly engaging formats. They have become staged, anticipated events, if not exclusive, peer-to-peer gatherings.  

Amazon’s Healthcare Gambit May Be Taking Shape

It is being reported that Amazon is ramping up conversations with the pharmacy benefit mangers (PBMs). In fact, it’s being reported that Amazon may be already working with several in an attempt to get into various contract arrangements. And while analysts are pointing out that it will take Amazon a few years to get licensed in all 50 states, the banter surrounding Amazon’s potential move into pharmaceutical distribution is all too familiar. Some are characterizing Amazon as a potential partner, while others see them as a direct threat, while others express their skepticism, saying that they don’t think Amazon would choose to move into such a highly-regulated space.

Amazon’s Move into Healthcare: Managing Tail Spend or Redefining its Last Mile?

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Everyone is consumed with Amazon’s widely reported “move” into healthcare. But what does that mean? While the prevailing wisdom suggests that Amazon has an opportunity to displace the group purchasing organizations (GPOs) and major distributors that dominate care provider supply chains, even if that’s true, is that Amazon’s endgame — managing healthcare’s tail spend?

Healthcare Needs More Mud: A Supply Chain Perspective

If ever a layman’s view of the holy war over healthcare reform had a chance to be heard, well, as a guy who’s covered the space for the better part of a decade, here goes nothing. (My disclaimer: I hold both political parties in equal contempt.) From a supply chain management perspective, there’s more fat on the healthcare bone than Arby’s latest pork belly sandwich. Origins of that old adage “doctors don’t make good businessmen” have roots in many places. But their collective decision to fully outsource their procurement and supply chain management needs (in fact, to establish healthcare’s group purchasing organization oligarchy) may be the quintessential example.

Welcoming Thomas Finn to a New Spend Matters Role as Sourcing & Supplier Management Research Director

It wouldn’t be quite accurate to welcome Tom Finn to Spend Matters, given that he has been principal editor of our sister site Healthcare Matters since 2011. But we are excited to announce that Tom is moving into a new analyst role at Azul Partners, the parent company of Spend Matters. He will cover sourcing, contracting and supplier management across industries, including healthcare. And yes, Tom will remain at the helm of Healthcare Matters.

ICYMI: The Rise of Locum Tenens in the Healthcare Industry

locum tenens physicians

In a recent post, Spend Matters’ Andrew Karpie addressed a rising trend in the healthcare industry: the use of contingent workforce, specifically the use of “locum tenens,” or temporary physicians. In his article, Locum Tenens and Healthcare Contingent Workforce Management: An Innovator’s Dilemma (Part 1), which published on Spend Matters last week, Andrew pointed to a Staff Care survey showing 42% of healthcare facility managers are currently looking for these temporary physicians, up from 32% in 2012.