The Unforeseen Impact: What to do With All This Excess Medical Equipment?

Shipping containers on boat - healthcare supply chain challenges

Significant upticks in medical equipment inventories have been a notable challenge for hospitals in response to peak-demand pressures brought on by the pandemic. With larger inventories, facilities have had their hands full managing the added volumes in an efficient and effective way. Put simply: hospitals are looking at their current staff and resources — both over-taxed from the past year — and wondering, “What do we do with all of this equipment?”

Permanent Shift in Thinking About Supply Chain Strategy

The challenge of managing larger inventories isn’t likely to fade away anytime soon, as the pandemic shifted the way many healthcare organizations think about their resource availability and supply chain strategies. It’s a similar story across many other industries: The unpredictable surges in demand unfortunately exposed gaps in supply chain processes, leading organizations to move from the “just in time” supply chain model toward a “just in case” model. This trend is growing more acute with ongoing raw material shortages and extended shipping and delivery times.

Moreover, the uncertainty of ongoing COVID surges and variable elective procedure volumes have put hospitals in a challenging position to predict demand moving forward. So, many healthcare organizations have opted to keep larger medical equipment inventories on-hand (owned or rented), so they can be prepared for whatever comes next.

Wasting Millions on Disconnected Processes

The price of larger medical equipment inventories goes well beyond the acquisition cost and increased overall spend. Hospitals can spend millions of dollars each year on unneeded capital and rental expenses.

Why?

Few organizations have dedicated, onsite logistics processes and resources focused on medical equipment. As a result, there is often a snowballing effect that drives up costs and labor. For example, devices are not readily available as there is not a system to ensure they are where they need to be – in patient-ready condition. As a result, caregivers can’t find equipment when they need it and have to spend time away from their patients searching for a device. Repeated incidents create a perception that there is not enough equipment to meet patient demand. This triggers additional requests to rent and purchase more equipment, which contribute to growing inventories and service costs.

And that’s just for one hospital. Imagine those undesirable affects cascading and multiplying across an integrated delivery network (IDN).

Now add the elephant in the room — recent staffing shortages due to burnout, turnover and other factors continues to stress hospital operations. As facilities, biomed and other departments struggle to fill vacancies on their teams, the prospect of building and implementing an unbudgeted, equipment management and logistics process becomes even more daunting.

Big Challenges Raise the Need for Strategic Equipment Management Across IDNs

COVID-19 shined a spotlight on a problem that has been overlooked for years: fundamental mechanisms — data, visibility, logistics, storage, standardization and sharing equipment between facilities — are lacking in the management of essential medical equipment. Even when utilization data is known, many hospitals and IDNs have a difficult time standing up a strategic infrastructure that optimizes the use of owned equipment. As a result, individual hospitals continue to make discrete equipment acquisition decisions with little or no standardization, making it difficult for IDNs to efficiently mobilize and maintain the tens of thousands of devices across their systems.

It’s essential for hospitals and IDNs to create or enhance their management of logistics — storing and moving equipment where and when it’s needed — all while maximizing the useful life of equipment. By falling behind on any one of these areas, health systems may find themselves with equipment not readily available when it’s needed, care delays that frustrate patients and clinicians and potential patient safety risks.

To add insult to injury, each hospital is now paying more for these negative outcomes, as the additional purchased or rented equipment sits unused for extended periods of time at an individual site.

Hospitals Have the Opportunity to Build a Roadmap

Right now, hospitals are looking forward to a post-pandemic world — and Agiliti is working with organizations across the nation to develop and implement strategies that address their ongoing medical equipment management challenges. We’re helping hospitals build a roadmap for how they plan to manage larger inventories, how they will optimize the equipment lifecycle and how they can create logistics strategies that prepare them to respond to peak-demand pressures. Download the playbook to learn more.

 

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