In March 2020, the World Health Organization (WHO) alerted industries and governments that they would need to ramp up manufacturing by at least 40% to meet surging demand for personal protective equipment (PPE) in light of the COVID-19 pandemic.
Supply chain disruption — caused by a range of factors, including rising demand, widespread panic buying, hoarding, and misuse – is placing lives at risk. Today, it’s abundantly clear that large healthcare organizations need a more resilient supply chain – and should make it a priority. How do we achieve this?
The drastic shortages of PPE and other critical and safety material (including an array of emergency equipment used in healthcare) have persisted throughout the pandemic have made one trend increasingly obvious: a systemic failure in long-range emergency planning for major crises. Large healthcare organizations of all kinds need to be better prepared to operate effectively when future devastating emergencies strike. LAC Healthcare Solutions (and our client’s experience) is that a more cooperative, proactive approach to securing supplies is the key to managing future events.
Nevertheless, the healthcare equipment and supplies industry is under greater strain than ever before. The PPE shortages, in particular, were a great shock, affecting operations throughout the private and public sector and even bringing destabilization to the power grid in some regions. LAC Healthcare Solutions has data-based evidence on how healthcare organizations can adapt, partly based on the US Supply Chain Task Force’s efforts to understand the causes of nationwide shortages last year. We have also been tracking the ongoing work conducted by federal legislators over the last year or so.
It is essential for healthcare organizations to embrace a strategy of shared self-sufficiency if they are serious about securing adequate supplies of PPE and other critical items. The equipment referred to here includes air filtration technology, plexiglass sheeting, generators, fuel, water, communications equipment, and temporary facilities to quarantine patients. It is paramount to look inward and commit to substantial improvements in organizational capacity to anticipate and react to health emergencies and establish networks that can proactively secure critical supplies.
The pandemic threw doubt on many companies’ JIT supply chain practices and demonstrated the necessity of detecting novel risks, tracing supply networks, and identifying multiple sources. Organizations should never rely on a single company or country for supplies. Large companies should engage in 24/7 monitoring of their international suppliers — which is certainly helped by recent technological advances, including artificial intelligence (AI) and natural-language processing. Rigorous supplier monitoring is more cheap and accessible than ever before.
The good news is that the crisis seems to have triggered a move to greater innovation in the PPE field. Organizations desire solutions that go much further than giving a basic level of protection — and PPE material suppliers have upped the ante, developing lighter and thinner equipment. Gloves or sleeves that are too thick or clumsy are becoming a memory. Another clear trend is the stronger focus on American-made products, partly due to a perceived over-reliance on imports.
Above all, there is renewed interest in superior healthcare equipment and services. That’s a promising sign. However, bigger healthcare supply chain concerns still affect the PPE field — particularly the high cost of raw materials, converting, and freight or shipping, which took off dramatically during the pandemic. That appears to be stabilizing and slightly declining at present, but it’s unclear whether these costs will return to pre-COVID rates by next year.
It must be recognized that some supply chain issues around PPE are outside the control of healthcare organizations. Still, it’s a good time to cultivate a more long-term, proactive approach to PPE supplies and how and where to go about securing them. Conveniently, one local company is now manufacturing over 20 million masks monthly at its Virginia Beach plant.
At present, we are advising Northern Virginia healthcare organizations on how to make this change. If you would like to know more, please get in touch with LAC Healthcare Solutions today.