Healthcare Supply Chain: 2023 Areas of Focus


Healthcare supply chain leaders have identified their top three areas of focus for 2023:

  • Costs
  • Supply Reliability
  • Operational Efficiency

In a recent survey, 78% of supply chain respondents said they are seeking cost efficiency above all other priorities.1

The pressure to examine dollars spent has procurement reconsidering purchasing decisions that were once easily rubber stamped.
Consider a capital purchase for example. There are typically two options for handling an upgrade or addition to a facility. 

  1. Identify potential options and initiate an evaluation to trial equipment and compare cost
  2. Purchase more of, or the next generation of, the instruments you already have 

For years the status quo of “auto-renewing” an existing arrangement felt sufficient. The surgical teams seemed satisfied with what they had, and if the investment was unquestioned previously then it must be deemed “safe”. 

This approach may have been acceptable in the past, but the increased level of fiduciary responsibility has procurement leaders re-evaluating. 

Capital trials are making a comeback and bringing substantial value with them. Procurement leaders are also becoming more meticulous in their consideration process, digging deep into lifetime costs versus a comparison at face value. 

A 2021 publication in Health Management, Policy and Innovation offered a detailed assessment strategy that can be applied to capital purchases.

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Value-Based Procurement Using Total Cost of Ownership:
A Step-by-Step Financial Assessment of Orthopaedic-Powered Instrument Procurement
Aazad Abbas and Jin Tong Du, Temerty Faculty od Medicine, University of Toronto; Cari Whyne, Division of Orthopaedic Surgery, University of Toronto, and Sunnybrook Research Institute; William Mitchell, Rotman School of Management, University of Toronto; Jay Toor, Division of Orthopaedic Surgery, University of Toronto

In their analysis, the authors express the criticality of a Total Cost of Ownership approach. 

“There is an overemphasis on the importance of acquisition price. This is especially concerning as medical devices’ total lifetime costs to an organization often significantly exceed acquisition price.”

The publication illuminates several gaps in traditional procurement methodologies and offers ways to overcome them. Could this modern approach be a way to uncover cost savings and maximize value at your facility? FIND OUT

1 Advancing Healthcare Through Supply Chain Excellence (2022, August 31). Three Key Areas for Health Care Supply Chain Success in 2023. AHRMM. Retrieved June 29, 2023, from