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Five predictions on how COVID-19 will reshape the healthcare supply chain

July 24, 2020

Prediction #4: The healthcare supply chain will step up to support care beyond the hospital setting.

COVID-19 has accelerated the move to deliver care increasingly in sites outside the acute care hospital setting. Mostly notably, changes in reimbursement and patient reluctance to go to the doctor’s office or a hospital have driven exponential growth in telemedicine. Use of outpatient and ambulatory surgery centers, and hospitalization at home is also increasing, especially as health systems resume elective and other non-COVID-19 related care.

The shift in where care is delivered ripples out to the delivery of supplies and other resources. Before COVID-19, some health systems (primarily larger and often with their own health plans) had begun expanding the reach of supply chain to support a more distributed healthcare system. Even some suppliers, especially in the orthopedic world, had developed ancillary services to support the move beyond the hospital.

With the expansion of care into the community, we will see growth in these kinds of programs. There will also be greater investment in data quality, interoperability, and security to support the standardization of products and processes and the increasing number of locations.

Prediction #5: An acute focus on working capital management will lead to more flexible payment options.

With increasing demands for COVID-19 care, a decrease in elective procedures and unanticipated labor and supply costs, providers are facing short-term pressure on cash flow. The pressure will mount if there are future waves of the virus.

To get through this time, providers will tap into their working capital to create more flexible payment options such as short-term lines of credit and expanded use of credit card programs. This will accelerate investments in invoice automation and workflow management, along with tools for payment flexibility. Longer term, the use of payment networks will create more payment options for providers and suppliers to consider.

The value of reflecting on lessons learned
While the COVID-19 pandemic has stressed the healthcare industry, the silver lining is that it also pinpointed opportunities for improvement. Some were a long time coming. Others emerged from the crisis. Many of them will drive positive change, but only if the lessons learned and new ways of thinking become intrinsic to how we work.

About the authors: Bruce Johnson is the president and CEO of GHX. Karen Conway is the vice president of Healthcare Value for GHX, where she works to advance the role of the supply chain as a critical enabler of a value-based healthcare system.

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