- Case Study About Arnold Palmer Hospital S Supply Chain Related To Chapter 11 Supply Chain Management Page 468 In The 1 (22.6 KiB) Viewed 70 times
- Case Study About Arnold Palmer Hospital S Supply Chain Related To Chapter 11 Supply Chain Management Page 468 In The 2 (69.95 KiB) Viewed 70 times
a Arnold Palmer Hospital's Supply Chain Video Case Arnold Palmer Hospital, one of the nation's top hospitals dedi- a goal of better medicine while achieving economic targets. For cated to serving women and children, is a large business with over instance, the heart pacemaker negotiation by the cardiology sub- 2,000 employees working in a 431-bed facility totaling 676,000 committee allowed for the standardization to two manufacturers, square feet in Orlando, Florida. Like many other hospitals, and with annual savings of S2 million for just this one product. other companies, Arnold Palmer Hospital had been a long-time Arnold Palmer Hospital is also able to develop custom prod- member of a large buying group, one servicing 900 members ucts that require collaboration down to the third tier of the sup But the group did have a few limitations. For example, it might ply chain. This is the case with custom packs that are used in the change suppliers for a particular product every year (based on operating room. The custom packs are delivered by a distributor, a new lower-cost bidder) or stock only a product that was not McKesson General Medical, but assembled by a pack company familiar to the physicians at Arnold Palmer Hospital. The buying that uses materials the hospital wanted purchased from specific group was also not able to negotiate contracts with local manu- manufacturers. The HPA allows Arnold Palmer Hospital to be facturers to secure the best pricing creative in this way. With major cost savings, standardization, So in 2003. Arnold Palmer Hospital, together with seven blanket purchase orders, long-term contracts, and more control of other partner hospitals in central Florida, formed its own much product development, the benefits to the hospital are substantial. smaller, but still powerful (with $200 million in annual purchases) Healthcare Purchasing Alliance (HPA) corporation. The new alli- ance saved the HPA members $7 million in its first year with two main changes. First, it was structured and staffed to ensure that the bulk of the savings associated with its contracting efforts went to its eight members. Second, it struck even better deals with ven- dors by guaranteeing a committed volume and signing not 1-year deals but 3-to 5-year contracts. "Even with a new internal cost of $400,000 to run HPA, the savings and ability to contract for what our member hospitals really want makes the deal a winner," says George DeLong, head of HPA Effective supply chain management in manufacturing often focuses on development of new product innovations and elficiency through buyer vendor collaboration. However, the approach in a service industry has a slightly different emphasis. At Arnold Palmer Hospital, supply chain opportunities often manifest them- selves through the Medical Economic Outcomes Committee. This committee (and its subcommittees) consists of users (including the medical and nursing staf) who evaluate purchase options with