Integration vs Collaborative Redesign Strategies of Health Systems' Supply Chains in the Post-COVID-19 New Normal: Cross-sectional Survey Across the United States.

BACKGROUND: Given the widespread disruptions to supply chains in 2020 because of the COVID-19 pandemic, questions such as how health systems are shaping strategies to restore the supply chain disruptions are essential to have confidence in health systems' supply chain model strategies. Plausibly, health systems have an opportunity for redesign, growth, and innovation by utilizing collaborative strategies now, compared to the usual strategies of integrating their existing supply chains to reduce inefficiencies. OBJECTIVE: This study focuses on teasing out the nuance of supply chain integration versus collaborative redesign strategies for health systems in the post-COVID-19 new normal. We focus on 2 research questions. First, we explore the impact of perceived supply chain challenges and disruptions on health systems' supply chain integration (SC-INTEGRATION) and collaborative redesign (SC-REDESIGN) strategies. Second, we examine the outcomes of integration and collaborative redesign strategic choices on growth and service outcomes. METHODS: We used data for this study collected through a consultant from a robust group of health system chief executive officers (CEOs) across the United States from February to March 2021. Among the 625 health system CEOs contacted, 135 (21.6%) responded to our survey. We considered supply chain-relevant strategy and outcome variables from the literature and ratified them via expert consensus. We collected secondary data from the Agency for Healthcare Research and Quality (AHRQ) Compendium of the US Health Systems, leading to a matched data set from the 124 health systems. Next, we used ordered logit model estimation to examine CEO preferences for partnership strategies to address current supply disruptions and the outcomes of strategy choices. RESULTS: Health systems with higher disruptions would choose integration (positive, P<.001) over redesign, indicating that they still trust the existing partners. Integration strategy is perceived to result in better service outcomes (P<.01), while collaborations are perceived to lead to greater growth opportunities (P<.05); however, the role of integration in growth is not entirely ruled out (combined model, P<.001). Plausibly, some health systems would choose integration and collaborative redesign models, which have a significant relationship with both services (combined model, P<.01) and growth, establishing the importance of mixed strategies for health systems. CONCLUSIONS: The cost of health care continues to rise, and supply-related costs constitute a large portion of a hospital's expenditure. Understanding supply chain strategic choices are essential for a health system's success. Although collaboration is an option, focusing on and improving existing integration dynamics is helpful to foster both growth and services for health systems.

Leadership development practices and hospital financial outcomes.

Affordable Care Act legislation is requiring leaders in US health systems to adapt to new and very different approaches to improving operating performance. Research from other industries suggests leadership development can be a helpful component of organizational change strategies; however, there is currently very little healthcare-specific research available to guide design and deployment. The goal of this exploratory study is to examine potential relationships between specific leadership development practices and health system financial outcomes. Results from the National Center for Healthcare Leadership survey of leadership development practices were correlated with hospital and health system financial performance data from the 2013 Medicare Cost Reports. A general linear regression model, controlling for payer mix, case-mix index, and bed size, was used to assess possible relationships between leadership practices and three financial performance metrics: operating margin, days cash on hand, and debt to capitalization. Statistically significant associations were found between hospital-level operating margins and 5 of the 11 leadership practices as well as the composite score. Relationships at the health system level, however, were not statistically significant. Results provide preliminary evidence of an association between hospital financial performance and investments made in developing their leaders.

Do EHR investments lead to lower staffing levels?

A study used FTE employees per adjusted occupied bed (FTE/AOB) as a measure to ascertain the effect of EHR investments on labor productivity. The study focused on three primary questions: Do FTE/AOB decline as the number of EHR applications used in a hospital increases? Is impact on FTE/AOB greater with some EHR applications than with others? Do FTE/AOB decline overtime, as the hospital continues to use the EHR application?

Data envelopment analysis: performance normalization and benchmarking in healthcare.

Healthcare organizations are being impacted by the current economic environment as severely as for-profit firms. As a result, hospital and system managers are being required to continuously assess and improve their operational efficiency, by focusing on productivity, costs and volumes. Benchmarking is one way to compare performance across hospitals, but many benchmarking methods are of limited value because they rely on ratio analysis which is fairly simplistic and does not allow for comparisons across organizations of different sizes, focus or risk profiles. One way to improve benchmarking efforts is an analytical technique called data envelopment analysis (DEA), which performs complex mathematical optimization of inputs (resources consumed) and outputs of healthcare production processes to facilitate comparison of one organization to others making adjustments for scale. This article outlines how healthcare organizations can use a new benchmarking technique to normalize, or standardize performance, using DEA tools.