1st Edition
Advancing Strategic Sourcing and Healthcare Affordability Our Discovery of the Lacuna Triangle
The United States spends more than 17% of its GDP on health care, while other developed countries throughout the world average 8.7% of GDP on healthcare expenditures. By 2028, that percentage in the United States is projected to be 19.7% of GDP.
Yet all this spending apparently doesn’t equate to value, quality, or performance. Among 11 high-income countries the United States healthcare industry ranked last during the past seven years in four key performance categories: administrative efficiency, access to care, equity, and healthcare outcomes. This book centers on ways to bring down skyrocketing healthcare costs and improve comparatively low patient outcomes by focusing on the second highest cost after staffing in U.S. healthcare: the supply chain. The authors present strategies for aligning the healthcare supply chain, leadership, physicians, and department budget owners to achieve evidence-based value analysis (EVA) and effective strategic sourcing. The key to bringing alignment to where it needs to be is understanding the art and science of EVA and strategic sourcing and reorienting the health systems toward productively and gainfully accomplishing them both. Within healthcare the biggest opportunities for a quantum leap in affordability and quality directly tie to improving the product and service selection process through EVA and greatly advancing hospital and health system supply chain sourcing strategies. The book outlines what the authors call the Lacuna Triangle—three lacunas (or gaps) that occur in hospitals and health systems that prevent them from pursuing effective EVA and strategic sourcing. The authors explore the three effects of those gaps, which keep the Lacuna Triangle walls tightly closed so that the oligopolies, irrational markets, and irrational pricing that those gaps create can continue to thrive, and where many healthcare organizations remain trapped. The goal with this book is to pluck the supply chain and health system executive and clinical leadership out of the chaos and irrationality they are caught in and give them tactics and strategies for reengineering the alignment of these processes to serve their enterprises’ needs.
The book does this by a deep exploration into strategic sourcing, a way of doing business that has been embraced and employed effectively for decades in supply chain management in various industries and in healthcare supply chain in other countries.
Preface. Dedications and Acknowledgements. About The Authors. Foreword by Samuel Greco. Foreword by Michael O’Boyle. Introduction. Chapter 1: Healthcare Challenges and the Supply Chain. Chapter 2: What is Strategic Sourcing? Chapter 3: “Strategic Sourcing” in Healthcare Today. Chapter 4: The Lacuna Triangle: Gaps Form Barriers to Strategic Sourcing. Chapter 5: A Best Practice Strategic Sourcing Model in Healthcare. Chapter 6: Strategic Sourcing Advanced Strategies. Chapter 7: Gauging the Benefits and Results of Healthcare Strategic Sourcing. Chapter 8: The Future of Healthcare Strategic Sourcing
Biography
Michael Georgulis, Jr., and Mark C. West together have nearly 70 years in supply chain and more than 50 years in the healthcare industry, including experience within the largest commercial payer (UnitedHealthcare), world-renowned health systems (Cleveland Clinic and UnitedHealthcare Global), the most influential healthcare group purchasing organization (Premier Health Alliance), and one unprecedented joint venture (SharedClarity). They are the authors of Implantable Medical Devices and Healthcare Affordability: Exposing the Spiderweb, released in March 2023 by Routledge, Taylor & Francis Group.
“Can you think of any industry that defers its supply decisions to third parties the way some healthcare provider organizations do with GPOs and suppliers?” “The time has come for a book like this. In fact, it is overdue.”
Samuel A. Greco
Senior Instructor, Business of Healthcare at University of Oklahoma, Price College of Business
Former Senior Vice President Financial Operations, Columbia/HCA
“I fully believe in, and endorse, the combination of evidence-based value analysis and strategic sourcing presented in this book and the benefits they provide. Why do I believe this? Because I’ve seen it work.”
Michael O’Boyle
Retired CEO of Ventra Health
Former COO & CFO of Cleveland Clinic
“Mark and Mike provide a proven roadmap for overcoming US healthcare supply chain gaps (“lacunas”), thereby empowering providers toward self-reliance and exceptional results. This book is a must read for healthcare leaders!”
Austin T. Pittman
Co-Founder & CEO of Suvida Healthcare
Former CEO of OptumCare
"Finally, a book willing to honestly confront, and provide real-world solutions to address, the unsound, unsustainable, and oftentimes unsafe supply chain practices that have devastated the healthcare industry for decades, impacting patients & caregivers alike.”
David Gomez CRNA
CEO/CTO of Infinitus Medical Technologies LLC
