May 2014 Back- breakingworkbreaking · 10 May 2014 | The ournal of Healthcare Contracting HEAltHCArE rEforM NAVIgAtIoN The Affordable Care Act (ACA) is making broad changes to the

Nurses lobby for patient-

handling equipment

and supplies

Back-breakingworkBack-breakingwork

May 2014 • Vol.5 No.3

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The Journal of Healthcare Contracting | May 2014 3

The Journal of Healthcare Contractingis published bi-monthly

by mdsi1735 N. Brown Rd. Ste. 140

Lawrenceville, GA 30043-8153Phone: 770/263-5262FAX: 770/236-8023

e-mail: [email protected]

Editorial StaffEditor

Mark [email protected]

Managing EditorGraham Garrison

[email protected]

Senior EditorLaura Thill

[email protected]

Art DirectorBrent Cashman

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VP ContractingTom Middleton

[email protected]

PublisherJohn Pritchard

[email protected]

Business Development DirectorKatie Brunelle

[email protected]

CirculationWai Bun Cheung

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The Journal of Healthcare Contracting (ISSN 1548-4165) is published bi-monthly by Medical Distribution Solutions Inc., 1735 N. Brown Rd. Ste. 140, Lawrenceville, GA 30043-8153. Copyright 2013 by Medical Distribution Solutions Inc. All rights reserved.

Please note: The acceptance of advertising or products mentioned by contributing authors does not constitute endorsement by the publisher. Publisher cannot accept responsibility for the correctness of an opinion expressed by contributing authors.

CONTENTS »» May 2014

4 Independents: ‘Hear us out’Independents believe they have a good story to tell the supply chain executive whose IDN has just purchased a physician practice

10 Healthcare Exchanges

16 Back-breaking workNurses lobby for patient-handling equipment and supplies

24 The ROI of safe-patient handling

24 Standards for safe patient handling and mobility

26 Numbers talk

28 Equipment important part of pending legislation

30 What Are You Becoming?

32 In the HeadlinesHospital and health system news from across the country

36 Benchmarking Your Way to SuccessEveryone needs benchmarks to up their supply chain expense game

pg16

“In any setting where healthcare

workers are manually lifting patients, they’re

at great risk.” – Jaime Murphy Dawson

May 2014 | The Journal of Healthcare Contracting4

DIStrIButIoN

Distributors get understandably nervous when their phy-sician-practice customers are acquired by a hospital or hospital sys-

tem. After all, hospital supply chain executives don’t know them,

nor are those executives always aware of the cost to serve non-

hospital customers. Challenging as the situation is, independent

distributors believe they can retain the business of newly acquired

physician practices, provided they demonstrate their unique – and

quantifiable – value to hospital supply chain executives.

“Distributors who have been

successful in retaining business

have proactively worked with

the [hospital] system; met with

the appropriate stakeholders,

that is, decision-makers; and

delivered solutions to meet

their unique needs,” says Dave

Rose, vice president, business

development and corporate

programs, National Distribu-

tion & Contracting, Nashville,

Tenn. NDC is a member service

organization providing distri-

bution, logistics, marketing and

other services to more than 300

independent medical, physical

therapy, rehabilitation and den-

tal product distributors.

“In large part, our distribu-

tors have been successful in

retaining business, but not

without selling their unique

value proposition and how it

translates into measurable and

sustainable value for the hos-

pital system,” he says. “Those

who have been successful have

also taken the initiative to un-

derstand and implement GPO

Independents: ‘Hear us out’Independents believe they have a good story to tell the supply chain executive whose IDN has just purchased a physician practice

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DIStrIButIoN

contracts, assist with contract compliance and product for-

mularies for their customers. They have become an anchor

tenant at the facility and positioned themselves as a partner

who can solve problems and provide solutions.”

Rose began his career in the healthcare industry with C.R.

Bard, Inc., holding various sales positions in the Bard Uro-

logical Division. He was also the Southeast region manager

of extended care for General Medical Corp. (now McKesson

Medical-Surgical) and vice president of sales and marketing

for Chester Labs, a manufacturer of personal care products

in Cincinnati, Ohio.

Steps to takePhysician-office distributors understand that the “status

quo” is no more, says Rose. “It goes without saying that de-

cision-makers will be different, and new relationships/part-

nerships will be forged. [Independent distributors] will need

to deliver easy-to-implement, cost-effective, supply solu-

tions to meet the needs of the new business relationship.”

Distributors must realize the new customer will demand a

more collaborative and transparent relationship.

Successful distributors welcome these changes as op-

portunity, and they give IDN/hospital supply chain execu-

tives compelling reasons to do business with them, says

Rose. “Customers need to have confidence they are in better

hands with you than without you.”

One way to start is to demonstrate that independent

distributors can react quickly and decisively to customer

requests, he says. What’s more, independents have a great

story tell about their ability to serve

providers across the care continuum.

“What a perfect time to sell the

benefits of partnering with a region-

al distributor,” he continues. “What a

wonderful window of opportunity

that allows independents to tell their

story of relentless service, and to say,

‘I’m the company who, unbeknownst

to you, has been a viable supply solu-

tion for years.’ What a great platform

to increase your company’s visibil-

ity and expand relationships beyond

your day-to-day customers.”

Tough questionsNon-hospital distributors can expect

some tough questions

about pricing from hospital/

IDN supply chain executives.

They must be ready with an-

swers, says Rose. “It is our re-

sponsibility, as distributors,

to educate the customer

about the cost variances to

serve different market segments. We

need to explain, and more important,

demonstrate, the different costs associ-

ated with serving a physician clinic vs.

the hospital. It is not unusual for the in-

dependent distributor to drive 15 miles

to drop off emergency equipment or

supplies, in low unit of measure, to a

physician office for a community event,

such as a school sports program.

“Distributors will hear the need to

reduce overall cost – not necessarily

“ our distributors have been successful in retaining business, but not without selling their unique value proposition and how it translates into measurable and sustainable value for the hospital system.”

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DIStrIButIoN

at the product level, but to improve efficiency and savings

across the entire operation,” he continues. “They will hear

that the customer will want to be an active participant in

the process, who wants visibility and

some control of the supply chain

decisions and process. Large provid-

ers who buy physician practices will

need the distributor to leverage GPO

contracts and support contract com-

pliance.” Distributors will need to be

prepared to help their customer navi-

gate GPO contracts, compliance and

reporting issues.

What’s more, non-hospital dis-

tributors will need to leverage tech-

nology to provide cost-effective so-

lutions that will give the IDN/supply

chain team real-time visibility to both

process and price, says Rose. “[Dis-

tributors] can expect to assist with

common ordering platforms that al-

low customer input and control. The

independent will position itself as a

partner/consultant who can assist the

hospital/IDN with product formular-

ies and offer suggestions for reducing

overall cost.”

Viable option“Change and uncertainty always

bring opportunity for those who are

flexible and creative,” says Rose. “The

independent distributor is a viable

option for hospital systems to serve

their newly acquired physicians. To-

day, nearly half of the alternate site

market is being serviced by the inde-

pendent distributor.

“The benefits of working with a lo-

cal company are obvious and numer-

ous. They can adapt quickly

to change, make decisions

and do more in far less time

than larger companies.

“Customers will al-

ways want choice. The

independent that is cur-

rently serving the physi-

cian market is very well

positioned to help the

hospital/IDN with their al-

ternate care supply chain

needs. Existing custom-

ers can be a tremendous

advocate for independent

distributors by making in-

troductions and providing

referrals. The hospital/IDN

customer needs their help,

and expertise, beyond the

hospital walls.” <JHC

Selling pointsHere’s what independents believe they have to sell supply chain executives whose hospital or IDN has just acquired some physician practices:

• Ability to understand and implement GPO contracts.

• Ability to serve providers across the care continuum.

• Ability to react quickly and decisively to customer requests.

• Ability to service customers on a moment’s notice.

• Ability to assist the hospital/IDN with product formularies.

“the independent will position

itself as a partner/

consultant who can assist the hospital/IDN with product formularies

and offer suggestions for reducing overall cost.”

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HEAltHCArE rEforM NAVIgAtIoN

The Affordable Care Act (ACA) is making broad changes to the way health insurance will be provided and

paid for in our country.

If you have been paying attention to the news during the

last few months you have certainly heard about healthcare.

gov, which is the federal health insurance “exchange.” Let’s

take a look at what these exchanges intend to do.

The Affordable Care Act created a new way for consum-

ers to purchase guaranteed coverage from private insurance

companies through an online marketplace or exchange.

Similar to how you book travel today

using Priceline.com or Orbitz.com,

these sites aggregate data and give the

consumer several options to choose

from. Here is a quick overview of how

this process works.

Individuals or small employers go

online through their exchange and

enter their personal information into a

web portal. After doing so, they learn

Healthcare ExchangesSupplier success in a post-reform healthcare market depends on a lot of factors, including a fundamental and thorough understanding of the foundation of healthcare reform. This is part of an ongoing series designed to help The Journal of Healthcare Contracting readers understand the implications of reform.



their eligibility status for available insurance programs, such

as Medicaid, CHIP (Children’s Health Insurance Program),

public subsidy options or employer-based insurance. The ex-

change allows them to shop, compare and choose the plan

that is best for them based on their eligibility and needs.

These exchanges are federal- or state-government-run

entities intended to create a more organized and competi-

tive market for health insurance by offering health plan

choices, common rules around plan types and pricing of

insurance, and providing information to help consumers

better understand the options available to them. Some

states have chosen to develop exchanges on their own,

others have elected to fall back on the federal program,

and others have entered partnerships with other states

and the federal government.

Transparency and accountability The goals of the program are simple: Make it easy for con-

sumers to purchase insurance, and provide transparency

and accountability among the insurance companies, using

competition as a way to drive down premiums. With more

patients insured, it is hoped that insur-

ance companies can spread out their

risk and offset the costs of higher-risk

patients on their plans.

Initially, exchanges will serve pri-

marily small businesses and individu-

als purchasing insurance on their own.

There is a large focus on low- to middle-

income families who are between 133

percent and 400 percent of the Federal

Poverty Level. Individuals and families

within this range receive government

subsidies or tax credits to purchase in-

surance through the exchange.

All consumers have four standard

plans to choose from. They range

from the cost-effective “bronze” plan,

which covers 60 percent of the pa-

tient’s healthcare costs, up to the

“platinum” plan, which covers 90 per-

cent of the patient’s healthcare costs.

these exchanges are federal- or state-government- run entities intended to create a more organized and competitive market for health insurance by offering health plan choices, common rules around plan types and pricing of insurance, and providing information to help consumers better understand the options available to them.

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Insurers in the exchanges are not required to offer plans

in all four levels, but they must offer at least one silver and

one gold plan.

All policies offered on the exchanges must cover ambula-

tory and emergency services, hospitalization, maternity and

newborn care, mental health and substance abuse, prescrip-

tion drugs and pediatric care, including vision and oral.

Because of healthcare reform, insurers can no longer turn

away patients with a pre-existing condition. But because

these patients increase a company’s risk, insurers are intent

on gaining new customers – including young people, many

of whom avoid health insurance – through the exchange to

minimize their risk. Also, lifetime and annual spending limits

have been eliminated.

Bottom-line impactSo what will the impact be on the healthcare industry?

For starters, effective March 31, 2014, everyone was re-

quired to have insurance. Those without it will be subject

to fines for non-compliance.

Regardless of how many people purchase insurance,

there may be an influx of newly covered patients into the

healthcare system. Health systems hope those newly cov-

ered patients will help them offset the cost of care they cur-

rently provide to those without insurance or underinsured.

The goal is to drive down the overall costs of healthcare.

How will providers react? They will continue to focus

on “Triple Aim.” Developed by the Institute for Healthcare

Improvement, or IHI, the Triple Aim

describes an approach to optimizing

health system performance by 1) im-

proving the patient experience of care,

including quality and satisfaction; 2)

improving the health of populations;

and 3) reducing the per-capital cost

of healthcare. All while maintaining a

focus on the patient.

Primary care is the new gatewayWith emergence of accountable care

organizations (ACOs) and patient-

centered medical homes, primary care

will become the new gateway to care.

Many of these newly insured will work

to become established with a primary

care physician, while others will wait

until they are hurt or sick to seek care

through a primary care physician or

emergency room visit.

With more insured patients entering

the healthcare system, providers will

need assistance dealing with these new

patient volumes in a changing health-

care environment focused on the Triple

Aim and patient-centered care. <JHC

MDSI – the parent company of The Journal of Healthcare Contracting – has developed the Healthcare Reform

Navigation Series, an online program designed to make the task of preparing your organization for 2014 and

beyond easier. This series will help you and your team with online courses that explain many of the key elements

integral to understanding reform and the transformation from fee-for-service to fee-for-value. The program in-

cludes a 12-month schedule of topics and live sessions with industry experts.

To learn more about the Healthcare Reform Navigation Series, contact Tim Brack, director of training, education

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Nurses lobby for patient-

handling equipment

and supplies

Back-breakingwork

As you walk the halls of your facilities, no doubt you’ve

seen nurses manually moving or repositioning patients. And with research showing the benefit of mobilizing post-op pa-tients as soon as possible, nurses are making an extra effort to do that as well.

But without assistive tech-nology, all that lifting and moving around can be haz-ardous to nurses and their patients, says the American Nurses Association.

Back-breakingwork

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SAfE PAtIENt HANDlINg

Government data backs up the association’s concerns. In 2011,

nursing assistants and registered nurses were among the top five

occupations with the highest number of musculoskeletal-related

injuries and illnesses resulting in time away from work, according

to the U.S. Department of Labor Bureau of Labor Statistics.

It’s time to establish a national culture of safety around safe patient

handling and mobility, says the ANA. Part of that culture should en-

compass patient-handling equipment and supplies. That being the

case, contracting executives may very well find themselves playing a

role in ensuring the health and safety of their nursing staffs.

No such thing as safe liftingThere’s no such thing as safe manual lifting or moving of patients,

says Jaime Murphy Dawson, MPH, senior policy analyst, Depart-

ment for Health, Safety and Wellness, American Nurses Association.

“In any setting where healthcare workers are manually lifting pa-

tients, they’re at great risk.”

The ANA did a survey in 2011 in an effort to assess the occupa-

tional health and safety issues that nurses face in the workplace,

explains Dawson. “One of their top concerns were musculoskeletal-

related disorders.” Sixty-two percent of respondents feared they

would develop a musculoskeletal disorder. In fact, 56 percent re-

ported working with musculoskeletal pain, and 80 percent of those

reported they experienced pain frequently.

Chances are, the real percentages are higher, as nurses don’t always

report their injuries, says Dawson. And the problem extends across the

care continuum, including home care and long-term care.

Standards, legislationLast summer, the American Nurses Association, in collaboration

with a multidisciplinary team of national experts, published sug-

gested national standards for creating, implementing and manag-

ing a safe patient handling and mobility program.

Their efforts to establish a national culture of safety could be boost-

ed by passage of a law by Congress that would establish an occupa-

tional safety and health standard to reduce injuries to patients, nurses

and other healthcare workers by establishing a safe patient handling,

mobility and injury prevention

standard. Such a measure has

been proposed in the past, and

one is currently working its way

through Congress.

Bill H.R. 2480, introduced in

June 2013 by Rep. John Cony-

ers Jr. (D-Mich.) and Rep.

George Miller (D-Calif.), would

require the Occupational Safe-

ty and Health Administration to

develop and implement a safe

patient handling and mobil-

ity standard that will eliminate

manual lifting of patients by

direct-care RNs and health care

workers, and require health

care employers to:

• Develop a safe patient han-

dling and mobility plan,

and to obtain input from

direct-care RNs and health

care workers during the

process of developing and

implementing such a plan.

• Purchase, use and main-

tain equipment, and train

health care workers.

• Track and evaluate injuries

related to the application

of the safe patient handling

and mobility standard.

• Make information about

safe handling available

to employees and

their representatives.

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It’s true that – as of press time – 11 states had enacted some

form of safe patient handling and mobility standard, based, at

least in part, on the ANA proposed standard, says Jerome Mayer,

associate director for federal government affairs, American Nurses

Association. “The problem is, at the state level, each process is dif-

ferent, and language has been changed.” As a result, there is no

program applicable in all states. What’s more, it’s a slow process,

and enforcement varies from state to state. A federal law would

address those concerns.

Patient handling equipmentThe safe-patient handling, mobility and injury prevention standard

proposed by Conyers’s and Miller’s bill calls for healthcare provid-

ers to do a number of things, including train their workers on safe

patient handling and mobility, track and review data relevant to

the facility’s program, and annually evaluate implementation of the

program. It also calls on providers to – within two years of passage

of the law – “purchase, use, maintain and make accessible to health-

care workers such safe patient handling equipment, technology

and accessories as the Secretary [of Health and Human Services]

determines appropriate.”

According to the ANA, research shows that the use of assistive

technology reduces injuries to workers and patients, and lowers

costs attributable to workers’ compensation, lost productivity, and

turnover. Healthcare managers and workers themselves often don’t

realize that these potentially career-ending injuries don’t always

occur as a single event, says the association. The cumulative effects

of repetitive strains result in long-term, debilitating disorders that

often require surgery.

The ANA refrains from recom-

mending any specific products

or services. That said, “there is a

lot of technology available, and

it is evolving by the minute,” says

Dawson. Equipment is available

to help lift and transfer patients;

help patients sit up, stand and

ambulate; and help them bathe

themselves and use the bath-

room. Friction-reducing sheets

can ease the task of moving pa-

tients. Ceiling lifts are the gold

standard for new construction,

but other technologies are

available to help healthcare

workers perform similar func-

tions in older facilities.

“It’s a very innovative field,”

says Mayer. “New things are

coming out constantly.”

Establishing a culture of safety

for safe patient handling and mo-

bility is a paradigm shift, much

like wearing gloves and protec-

tive equipment for all blood and

body fluid precautions was 20

years ago, says the ANA. Health-

care workers routinely practice

universal or standard precau-

tions for bloodborne pathogens.

Similarly, they will get to the

point where they act on the as-

sumption that any lifting is haz-

ardous to workers and patients

alike, and that assistive technol-

ogy must be in place.

“ In any setting where healthcare workers are manually lifting patients, they’re at great risk.”

– Jaime Murphy Dawson

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the roI of safe-patient handlingThere is an ROI for the acquisition of equipment and the time spent training all healthcare workers on it, according to Jai-

me Murphy Dawson, MPH, senior policy analyst, Department for

Health, Safety and Wellness, American Nurses Association. With

a safe patient handling and mobility program in place, nurses

and other healthcare workers can return to work after an injury

confident that they won’t be

injured again. “These are high-

ly qualified healthcare profes-

sionals,” she says. “It can cost

up to $100,000 to replace a

nurse.” A safe patient handling

and mobility program can

help hospitals retain them.

Safe-patient handling and

mobility programs not only lead to greater employee satisfaction,

but fewer workers comp claims, adds Jerome Mayer, associate di-

rector for federal government affairs, American Nurses Association.

What’s more, when patients are moved in a safe manner, certain

hospital-acquired conditions and incidents, such as pressure ulcers

and falls, decrease. “This a big concern for hospitals, because CMS

has said they won’t pay for cer-

tain hospital-acquired condi-

tions,” he says. And the average

cost associated with a pressure

ulcer can reach $40,000; for a

fall, $20,000 or more.

“These are costs the hospi-

tals are eating,” he says. “Get-

ting buy-in to a safe patient

handling and mobility pro-

gram from the staff [provides] a

return on investment.”

Standards for safe patient handling and mobilityUniversal standards for safe patient handling and mo-bility (SPHM) are needed to protect healthcare workers from in-

juries and musculoskeletal disorders, says the American Nurs-

es Association. Addressing healthcare worker safety through

SPHM will also improve the safety of healthcare recipients, that

is, patients.

ANA’s Department for

Health, Safety and Wellness

and a team of national experts

established a uniform, na-

tional foundation for SPHM to

prevent injuries to healthcare

“ This a big concern for hospitals, because CMS has said they won’t pay for certain hospital-acquired conditions.”

– Jaime Murphy Dawson, MPH

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safe patient handling

workers and patients. In June 2013, the association published a

list of eight suggested national standards for safe patient han-

dling and mobility.Standard 1: Establish a culture of safety.

Standard 2: Implement and sustain a safe patient handling and mobility (SPHM) program.

Standard 3: Incorporate ergonomic design principles to provide a safe environment of care.

Standard 4: Select, install and maintain SPHM technology.

Standard 5: Establish a system for education, training and maintaining competence.

Standard 6: Integrate patient-centered SPHM assessment, plan of care and use of SPHM technology.

Standard 7: Include SPHM in reasonable accommodation and post-injury return to work.

Standard 8: Establish a comprehensive evaluation system.

The SPHM standards are

open and voluntary, according

to the ANA. The standards do

not require use of any specific

products or services. Nor do

ANA or the endorsing orga-

nizations promote, endorse,

or recommend any products

or services.

The Safe Patient Handling and Mobility Standards are property of the American Nurses Association © 2013. All rights reserved.

Numbers talkNursing assistants and RNs were among the top five occupations in terms of the number

of incidents involving musculoskeletal-disorder-related days away from work in 2011.

• Nursing assistants: 25,010.

• Laborers and freight- stock- and material movers- hand: 21,700.

• Janitors and cleaners- except maids and housekeeping cleaners: 16,530.

• Heavy and tractor-trailer truck drivers: 13,750.

• Registered nurses: 11,880.

• Stock clerks and order fillers: 10,250.

• Light truck or delivery services drivers: 9,600.

• Maintenance and repair workers- general: 9,300.

• Production workers- all other: 9,250.

• Retail salespersons: 8,550.

Source: U.S. Department of Labor, Bureau of Labor Statistics, http://www.bls.gov/news.release/osh2.t18.htm

C

M

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CM

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CMY

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Scan here for more information plus a free gift!

When choosing IDN standardization of diagnostic cardiology, consider this: Who can offer intuitive solutions in Hospitals, Physician Offices and Clinics? Who has the largest direct field service team specifically focused on Diagnostic Cardiology? Who pioneered interoperability to third party ECG Management Systems? Who builds their products in Milwaukee, Wisconsin? One answer, three brands: Burdick – Mortara – Quinton. To learn about how we can assist you in meeting the needs of your IDN, call us today at 800.354.1600.

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The Nurse and Health Care Worker Protection Act of 2013 (H.R. 2480), introduced in June 2013 by Rep. John Conyers

Jr. (D-Mich.) and Rep. George Miller (D-Calif.), directs the Secre-

tary of Labor to issue an occupational safety and health standard

to reduce injuries to patients, nurses and all other healthcare

workers by establishing a safe patient handling, mobility and

injury prevention standard.

Much of that standard has to do with employee training and

participation in safe patient handling programs. But technology

and equipment are important too. That’s because patient han-

dling technology can reduce musculoskeletal injuries among

healthcare workers, and reduce skin tears, pressure ulcers and

falls among patients.

Among the bill’s provisions regarding equipment and technology

are these:

• “The safe patient handling, mobility, and injury prevention

standard shall require the use of engineering and safety

controls to perform handling of patients and the elimination

of injuries from manual handling of patients by direct-care

registered nurses and all other health care workers, through

the development of a comprehensive program, to include

the use of mechanical technology and devices to the greatest

degree feasible.”

• “[W]ithin 2 years of the date of promulgation of the final

standard, each health care employer shall purchase, use,

maintain, and make accessible to health care workers,

such safe patient handling

equipment, technology,

and accessories as

the Secretary

determines appropriate.”

• “[E]ach health care

employer shall consider

the feasibility of

incorporating safe patient

handling technology

as part of the process

of new facility design

and construction, or

facility remodeling.”

• “Where the use of

mechanical technology and

devices is not feasible, the

standards shall require the

use of alternative controls

and measures, including

trained, designated lift

teams, to minimize the

risk of injury to nurses

and health care workers

resulting from the manual

handling of patients.” <JHC

To read the entire text of the bill, go to http://thomas.loc.gov/cgi-bin/thomas

Equipment important part of pending legislation

You worry about the bottom line...

We’ll take care of your front line.

Approximately 8 million U.S. healthcare workers (HCW) are potentially exposed to hazardous drugs, including pharmacy and nursing personnel.1 These drugs are known or suspected to cause cancer, miscarriages, birth defects, or other serious health consequences.2

At B. Braun, we’re protecting those who dare to care with innovative, closed system devices designed to help reduce the risks associated with admixture, transport, delivery and disposal of hazardous drugs.

For more information on exposure and reducing the risks, visit www.CytotoxicExposure.com

1 US Bureau of Labor Statistics, May 2006 National and Occupational Employment and Wages estimates, Washington DC: United States Department of Labor, Bureau of Labor Statistics; 2007 2 www.invw.org/chemo-mainRx Only. ©2013 B. Braun Medical Inc. Bethlehem, PA. All Rights Reserved. 13-3928B JHC_9/13_KE

B. Braun is committed to

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By Dan Nielsen

“What are you becoming?” This is a critical question every leader should frequently ask him

or herself – and answer in detail. This is also a

question every leader should frequently ask each

and every direct report and team member.

Not only is the question critical to achiev-

ing your potential and reaching your personal

and professional goals and dreams, it is critical

to the future of your direct reports, your team,

and your organization! Just as important, very

seriously and frequently ask-

ing this question sets an im-

portant expectation and

will dramatically and

positively impact the

culture of your team and

your organization.

Frequently and very seriously

asking yourself, your direct

reports, your team, and your entire organization

this critical question will result in the following:

• Every person within your entire organization

will quickly come to understand that this

critical question is a high priority to be seri-

ously considered and answered, if a person

– regardless of their title or level within the

organization – is to remain a part of and suc-

ceed within your organization.

• Asking and seriously answering this question

will dramatically and positively affect corporate

culture throughout your entire organization.

• Your organization, and the people within

your organization will succeed at a much

higher level and rate than they otherwise

would. Of course they will – they know what

they are becoming!

• Many people throughout your organization,

for the first time, will seriously and con-

sistently think about, plan,

and take serious, consistent,

intentional and purposeful

action regarding what they

are becoming.

I suggest you add this criti-

cal question, “What are you

becoming?” to the discussion

of every annual or quarterly

review and evaluation you conduct. And that

you set a policy that this critical question will be

discussed during every review and evaluation

conducted throughout your entire organization.

Not just in general, but specifically, the “who,

what, when, where, why, and how” of “What are

you becoming?”

You will be absolutely amazed at the results.

I guarantee it! <JHC

HEAltHCArE lEADErSHIP

What Are You Becoming?

Dan Nielsen – www.dannielsen.com

National Institute for Healthcare Leadership – www.nihcl.com

America’s Healthcare Leaders – www.americashealthcareleaders.com

CAT SCAN


Washington: Providence Health & Services sees decreased operating income in 2013Providence Health and Services (Renton, WA) reported lower-than-expected operating income

for 2013 due to flat inpatient volume and an adverse payer mix. The system reported $37.7 mil-

lion in net operating income for 2013, ended December 31, which was 81.5 percent below the

$204.1 million it earned in 2012. Revenue increased about five percent to $11.1 billion, from

$10.6 billion in 2012. Inpatient volume was nearly flat, declining 0.1 percent, but commercial

volume was 4.9 percent lower than expected. Providence instead saw a greater percentage of

Medicare and Medicaid patients.

IntheHeadlinesHospital and health system news from across the country

Editor’s note: The following news has been compiled by Major Accounts Exchange (The MAX), health care’s leading provider of real-world intelligence for the supply chain. The MAX serves as a Supply Chain “Community” where senior-level executives can easily Find, Digest, and Act on vital business and mar-ket intelligence. For the latest news impacting the supply chains of over 1,200 IDNs and all the GPOs, visit http://www.uslifeline.com/

Michigan: Three health systems plan mergerBeaumont Health System (Royal, Oak, MI), Bots-

ford Health Care Continuum (Farmington Hills,

MI), and Oakwood Healthcare System (Dear-

born, MI) signed a LOI to form a new IDN. Un-

der the proposal, the three systems would pool

their assets and operations into a single orga-

nization designed to improve patient access to

care and take advantage of economies of scale.

It would function under a unified leadership

structure initially led by Beaumont Health CEO

Gene Michalski. The organizations are currently

undergoing due diligence procedures and the

merger will require regulatory approval.

The Journal of Healthcare Contracting | May 2014 33

Pennsylvania: DLP Healthcare signs LOI to acquire Conemaugh Health SystemDuke Lifepoint Healthcare (DLP Healthcare)

(Brentwood, TN) signed an LOI to acquire Co-

nemaugh Health System (Johnstown, PA). Un-

der the proposed deal, DLP Healthcare will in-

vest more than $500 million in Conemaugh over

the next 10 years, retain its existing employees,

and allow its board of directors to control local

operations. A Conemaugh spokesman said the

acquisition was part of the system’s plan to part-

ner with a larger organization to better position

itself for changes in healthcare delivery. Pending

due diligence and regulatory approvals, the ac-

quisition is expected to close in fall 2014.

North Carolina: Carolinas HealthCare System opens Behavioral Health DavidsonCarolinas HealthCare System (Charlotte, NC)

opened Carolinas HealthCare Behavioral Health

Davidson (Davidson, NC) after slightly less than

two years of construction. The $36 million,

67,000-sq-ft hospital features three 22-bed

units, two dedicated to mood disorders, with

another reserved for patients suffering from

depression and substance abuse. The cam-

pus also features a 10,000-sq-ft medical office

building for outpatient mental health care. Car-

olinas HealthCare expects the hospital to oper-

ate at a loss, but the psychiatric ER

and other services should ensure

patients receive appropriate care

and reduce costs at other Carolinas

HealthCare facilities.

Washington DC: US Naval Hospital Guam begins transition to new $158M facility

US Military Health System (DoD) (Washington,

DC) and US Navy Bureau of Medicine and Sur-

gery (BUMED) (Falls Church, VA) announced the

transition from US Naval Hospital Guam (FPO, AP,

GU) to the US Naval Hospital Guam Replacement

(Agana Heights, Guam) will begin on April 11 and

run through April 20, 2014. The new $158 million,

281,000-sq-ft, 42-bed hospital features four oper-

ating rooms, two c-section rooms, and improved

diagnostic and ancillary services including MRI

and Cat scanning suites.


By Robert T. Yokl

VAluE ANAlYSIS

Benchmarking Your Way to

Everyone needs benchmarks to up their supply chain expense game

If you aren’t aware of it, benchmarking is your key to becoming the best-of-the-best in sup-

ply chain expense management. No longer can we

guess where our savings reside. We need to know,

with clarity and certainty, where our savings are

hidden for the following three reasons:

• No one has the unlimited resources to search

in the weeds for buried savings that might

never result in realizable dollars.

• No one has the visibility that is necessary to ferret

out savings that are obscured from your view.

• No one has the time that is required

to uncover where your next savings

opportunities are coming from.

• Yet, all of these negatives can become

positives, with the right benchmarking system.


VAluE ANAlYSIS

A system in placeBenchmarking, if done artfully and scientifically, can solve

your challenges of not having unlimited resources, unre-

stricted visibility and limitless time to search for new savings

opportunities, because benchmarking pinpoints with near

certainty where your best savings opportunities reside. For

instance, a Children’s hospital client of ours saved $525,233

on their lab reference tests when our benchmarks identified

a 6 percent savings gap with their cohort group. Without this

yardstick this hospital, in our opinion, would have continued

to spend half-a-million dollars a year unnecessarily for their

lab reference tests for many years.

As you know, your department heads and managers

are super busy and often don’t even have the time to at-

tend your value analysis team meetings. So when you get

them to a meeting you had better not have them work on

projects that end up as “dry holes,” or they will surely start

skipping your value analysis meetings in the future. This is

another benefit of benchmarking, it can give the fuel that

is necessary to almost guarantee savings for your value

analysis project managers.

Another advantage of benchmarking is that you can es-

timate your savings opportunities before, during and after

your value analysis projects to ensure that your value analysis

project managers have squeezed the

towel dry on any given savings that

were identified through benchmarking.

Here’s how this works. If your bench-

marking tells you that there is a $127,987

savings opportunity on pulse oximeters,

you then have a targeted savings goal

for this value analysis project. If at the

end of the project your team member

has only uncovered $56,322 in realiz-

able savings then you need to audit this

project to find out what happened to

the other $71,167 that was your

original goal.

We often find that value

analysis project managers miss

their targeted savings goal

because they didn’t dig deep

enough into the data, didn’t

work hard enough to make

savings happen, the data was

flawed or the benchmarks

were calculated improperly. No

matter what the reason, we in-

sist that our clients audit their

value analysis projects if they come up

short on their estimated savings goals.

It just makes sense to do so! This is how

to develop a learning organization,

rather than point fingers at each other!

To recap, benchmarking is the

search for best practices that lead to

superior performance. There are no

shortcuts to this process, but there are

big rewards for those supply chain pro-

fessionals who benchmark their way

to success in turbulent times. <JHC

No matter what the reason, we insist that our clients audit their value analysis projects if they come up short on their estimated savings goals. It just makes sense to do so!

A well-designed apparel programcan help patients feel:

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Safe by making Caregivers easily identifiable

At ease by not beinguncomfortable and overexposed

In control in anuncontrollable environment

A positive patient experience has a directeffect on HCAHPS® scores and reimbursements.

Big things can happen when you focus on the details.

5YOUR TRUSTED GUIDE

In today’s healthcare environment, it’s difficult to anticipate the challenges that will emerge. Relying on an expert guide who has traveled the path and avoided the pitfalls is key. SolutionsTrust leverages “operator experience” to optimize your performance and ensure a successful supply chain journey. Learn more about SolutionsTrust at www.totalcostmanagement.com

“Experience matters. I recommend a TRUSTed partner to help you not only

survive, but thrive.”

Documents

May 2014 Back- breakingworkbreaking · 10 May 2014 | The ournal of Healthcare Contracting HEAltHCArE rEforM NAVIgAtIoN The Affordable Care Act (ACA) is making broad changes to the