The Canadian health care system has entered an unprecedented era of change driven by the acute impacts of several challenging trends. In order to meet the patients’ requirements and the specific demands of the sector, medical device manufacturers and healthcare providers are responding to these new trends by adjusting many of their core operating areas, one of which is their supply chain. Healthcare providers are looking to attain maximum operating efficiency at the lowest possible cost, however, unlike other industries, the healthcare supply chain can have a direct impact on the patients relying on it. With patients’ lives at stake, it’s vital to ensure that the supply chain’s effectiveness doesn’t suffer as a result of cost savings initiatives, or other external factors. The supply chain must remain constant and reliable.
Here are the top three trends driving new challenges that healthcare organizations and medical product manufacturers are faced with in their supply chain:
Increasing Regulatory Complexity
Regulatory compliance is one of the top concerns among healthcare organizations and is one of the vital tasks for the supply chain professionals managing healthcare products. Each type of product, from pharmaceuticals to medical devices to medical supplies, adheres to specific rules for storage, handling, and transportation. The healthcare regulatory complexity stems from ensuring that every product that touches the patient or consumer is safe, and has not been tampered with in any way; security is a critical element throughout the supply chain. Over the last 5 years, there has been an increased number of changes and new regulations to be adopted and adhered to. Due to the wide variety of medical devices, these products are regulated by a risk-based classification system and grouped into four different product classes. Quality and compliance issues are on the rise due to increased products complexity and heightened regulatory scrutiny. The number of FDA claims brought against organizations has been on the increase as these expanding regulatory standards present new compliance challenges.
Furthermore, new Good Distribution Practices (GDP) regulations on supply chain processes have been introduced in Europe, China, and Canada. In order to keep up with all the changes, it is important to be able to rely on a healthcare regulatory compliance specialist who would be consistently ensuring that every product is handled following the proper procedures throughout the supply chain.
Changing demographics continues to be one of the largest challenges for health care providers. The urbanization of our society has resulted in tremendous growth of population in metropolitan areas, creating increased demand for health care. Furthermore, the aging population is now a global phenomenon and is certainly a challenge in Canada. Therefore, the number of people requiring healthcare services is also on the rise. Health care providers need to plan ahead and invest in the society’s future needs, and the challenge is to support a larger infrastructure, including the supply chain, while containing the costs within the limited budgets.
Overall the progress in the healthcare field with regards to dealing with the supply chain challenges is being made at a rather slow pace, because of the complexity of the system and strict regulatory requirements. In order to ensure that the system functions in the best interest of the patients while being cost-effective and efficient, it is important to engage reliable, accountable partners that help healthcare organizations to be compliant, implement innovative solutions, and leverage shared distribution networks. This includes taking an omni-channel approach to meet the needs of changing customer requirements.
Power of the Payor
The payors (healthcare organizations or medical suppliers’ “clients”) have to continuously grapple with increased demand for health care and the need to adopt new, innovative products and solutions. With constrained budgets, they are increasing pricing pressure and adopting new approaches. This, in turn, has put a lot of pressure on companies manufacturing or distributing health care products to become more efficient so that they can stay competitive. Some of the strategies to meet this challenge and increase the system’s efficiency may include consolidation of healthcare organizations’ procurement function, the shift of healthcare from institutions to community and home care settings and improving the efficiency of the supply chain.
The healthcare industry is also addressing the challenge of decreasing costs by adopting healthcare information systems that allow practitioners and patients to access healthcare information, research medical solutions and products, and even get a remote diagnosis. We have seen telemedicine being leveraged to provide better access in remote communities while keeping costs down. New personal health measurement and diagnostic devices also empower patients by giving them the ability to monitor their own health.
This requires the healthcare supply chain to become more responsive and innovative to be able to deliver medical product to patients’ homes and provide a distribution network that can reach all parts of Canada.
Staying on top of key trends and adjusting your supply chain as required, or partnering with an accountable and reliable 3PL who has already developed the necessary solutions is crucial for the future of many healthcare companies.
Contact SCI today and find out how our configurable custom healthcare supply chain solutions can deliver better outcomes to your organization and, ultimately, the patient.