Hospitals Could Save $23 Billion Annually by Streamlining Supply Chain Operations, Product Use

Transportation Monitor Worldwide

September 15, 2017

Hospitals nationwide could reduce annual supply expenses by approximately $23 billion in aggregate through improvements in supply chain operations, processes, and product use, according to a Navigant analysis of more than 2,300 hospitals. This represents a 17.8% average total supply expense reduction opportunity, or up to $9.9 million a year per hospitalan amount equivalent to the annual salaries of 150 registered nurses, or the cost of 4,000 cardiac defibrillators or five Da Vinci robots.


The analysis also shows lower supply spending does not have to reduce quality, as hospital-acquired condition and value-based purchasing scores are slightly better at top-performing supply chain facilities. Moreover, the chance to realize savings may exist for all types of hospitals, with opportunities relatively equal across such characteristics as size, regional location, and whether the facility is urban or rural, for-profit or not-for-profit, or system-based or standalone. To view these results, visit www.navigant.com /SupplyChainAnalysis.


The pressure on hospitals and health systems to reduce costs and maintain quality will only intensify, no matter the outcome of healthcare reform, said Christine Torres, system VP of supply chain management for Philadelphia-based Main Line Health. The supply chain represents close to a third of the average hospitals overall operating expense, and its predicted to surpass labor as a hospitals greatest expense by 2020. Opportunities exist for all organizations, even top performers, to improve supply chain efficiencies while continuing to offer the highest levels of care to the communities we serve.


Provider best practices


The study found that the top 24% of 2,331 U.S. hospitals analyzed spent $23 billion less a year than other facilities on supply chain products and related operations, processes, and procedures. Savings could be achieved if the remaining 76% of hospitals perform at the level of top performers for supply chain budget efficiency.


Top performers consistently leverage evidence-based protocols and data analytics to reduce variation in pricing, product use, and clinical outcomes. This information better equips supply departments to:

  • Reduce the number of suppliers and contracts for like items, particularly with products needed for routine procedures.
  • Optimize the type and frequency of products used based on specific patient circumstances and cases.
  • Engage physicians to standardize use of implantable devices proven to produce clinically equivalent outcomes at a lower cost.
  • Automate requisitions, purchase orders, invoices, and other manual supply chain processes that can lead to documentation errors.


Its clear that some hospitals have the appropriate strategies and processes in place to efficiently manage supply chain budgets while maintaining high-quality outcomes, said Rob Austin, associate director at Navigant. For example, we have found, somewhat counterintuitively, that the highest-performing providers are simultaneously able to decrease cost and improve quality, in part by reducing clinical variation. Lower-performing supply chain departments need to leverage these types of proven best practices to drive care delivery improvements.


Benchmarking data is also essential, but providers must look outside their organization to obtain a true snapshot of performance.


In-hospital benchmarks and year-over-year improvement goals are valuable in monitoring internal supply chain performance, but these measures dont reveal an organizations true improvement potential, said Paul Weintraub, director at Navigant. To accurately uncover efficiency opportunities, providers must look beyond their facilitys four walls and leverage industry-wide benchmarking data that compares their supply performance against that of their peers.


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Home Depot Charged $5.7 Million Civil Penalty for Knowingly Selling Recalled Products

Mondaq Business Briefing

September 15, 2017

The U.S. Consumer Product Safety Commission (CPSC) announced on August 29 it has provisionally agreed with Home Depot U.S.A. Inc. to a $5.7 million settlement of allegations that the retailer unlawfully sold recalled products over a four-year period. The settlement will almost certainly become final once The Commission considers public comments as required by its rules.


The CPSC staff alleges in the settlement agreement that Home Depot knowingly sold or distributed approximately 2,816 units of 33 different recalled products from 2012 to 2016, in violation of Section 19(a)(2)(B) of the Consumer Product Safety Act (CPSA). Under this provision of the CPSA, knowingly means the retailer knew or should have known of the sale of a recalled product. Indeed, CPSC staff do not allege Home Depot intended to sell any recalled products, but rather that it failed to accurately identify, quarantine and prevent the sale of the recalled items essentially, an allegation of negligence.


Notably, CPSC and Home Depot had issued a joint press release in November 2015 notifying customers of the post-recall sales, but CPSC staff asserts that Home Depot sold additional units of some of the same recalled products (as well as other recalled products) after the press release. While it is not clear from the settlement agreement, it seems reasonable to assume that the large size of the agreed penalty may have been at least in part due to the post-press release sales.


As is typical in recent civil penalty settlements, the settlement agreement also requires Home Depot to maintain a compliance program to prevent future sale or distribution of recalled products.


The Commission voted 4 to 1 in favor of the proposed settlement. All Commissioners believed a penalty to be justified, with Acting Chairman Ann Marie Buerkle voting to accept a $1 million penalty rather than the $5.7 million penalty that her fellow Commissioners including Republican Joseph Mohorovicvoted to approve.


This penalty is not the first penalty for the sale of recalled products. In 2014, Meijer paid a settlement of $2 million for selling approximately 1,700 units subject to 12 recalls. In addition, one of the claims by the government in the pending U.S. v. Spectrum Brands Inc. case is for the sale of recalled products. Retailers obviously need to take their obligation not to sell recalled products seriously, as should manufacturers. The law may also create challenges for manufacturers as retailers impose requirements on manufacturers (like changes in product SKUs for products that are recalled) designed to ensure retailers do not inadvertently sell a recalled product.


The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.


Original headline: United States: Home Depot Agrees To $5.7 Million Civil Penalty To Settle Allegations It Sold Recalled Products


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Federal Probe Finds Tesla’s Autopilot Contributed to Fatal Crash

CNNMoney.com

September 14, 2017

A federal investigation has found that Teslas Autopilot is partly to blame in the fatal crash of a Model S last year.


Joshua Brown was killed in May 2016 when his Tesla crashed into a tractor-trailer in Florida while the self-driving software was active. Brown had not tried to control the car in two minutes, and the Autopilot didnt brake to avoid the collision.


The Tesla Autopilot wasnt designed for the road Brown was driving on, and drivers are expected to watch the road and take control as needed. Tesla Autopilot is not designed to handle the entire job of driving.


The investigation by the National Transportation Safety Board (NTSB) criticized Tesla for allowing Autopilot to be activated on roads it cant handle, and for how it determines whether drivers are engaged. It monitors wheel torque, and a driver could have a hand on the wheel without paying attention to the road.


The NTSB researchers noted that decades of research has shown humans are bad at monitoring automation systems. They may be lulled into complacency, and trust the Autopilot too much.


Weve found limitations with Teslas system, but we think we find limitations with other systems, NTSB researcher Robert Molloy said Tuesday at a board meeting. We think its an industry-wide problem.


Tesla said in a statement that it will evaluate the NTSBs findings.


We will also continue to be extremely clear with current and potential customers that Autopilot is not a fully self-driving technology and drivers need to remain attentive at all times, the company said.


The NTSB finding conflicts with a report from the National Highway Traffic Safety Administration (NHTSA), which found in January that the crash was not the result of any defect. The report also found a nearly 40% reduction in crashes after Tesla autosteer installations.


But some safety experts have doubts about that finding. Its not clear whether NHTSA accounted for a Tesla software update that added safety features, including emergency braking. NHTSA declined to comment.


In no shape or form does the NHTSA document pass for a scientific assessment, Missy Cummings, a Duke professor and director of its Humans and Autonomy Laboratory, told CNN.


Quality Control Systems, an organization specializing in data research, filed a lawsuit this summer to get the data from the NHTSA study.


1.25 million people are killed on roads every year, and human error is overwhelmingly the reason. Fully autonomous vehicles are widely expected to save lives, but it will be dangerous if automakers rely on partial autonomous systems in the meantime.


Until we get there, its going to be painful, NTSB chairman Robert Sumwalt told reporters afterwards. But ultimately the utopia will be when everything is automated.


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AI Could Be a Game-Changer for Physicians and Their Patients

Indian Health Care News

September 14, 2017

Automation might make some physicians nervous. But even as the debate rages over whether machines could or should replace doctors, artificial intelligence (AI) continues to gain ground in the healthcare industry.


AI could change the way medicine is practiced and ultimately free up doctors to spend more time with their patients, said Paul Balagot, chief experience officer at Precisioneffect, a California healthcare marketing and advertising agency that focuses on scientific advances in some of its campaigns.


Its an ever-evolving field. Theres a huge opportunity for artificial intelligence to transform healthcare.


While the most dramatic possibility is the development of robotic doctors powered by AI, there are many ways AI can help, rather than threaten, doctors.


Companies such as Amazon, Apple, Alphabet, IBM, Microsoft and others are investing in the healthcare AI space and their advances in innovation and technology aim to help with tasks from patient charting to decision support.


Ironically, AI could even help fix some of the problems created by technology that can lead to poor physician satisfaction, including time spent on electronic health records, payer requirements and government regulations.


I think AI is uniquely positioned to help streamline that business side, Balagot said. AI could eliminate some of that administrative burden by finding ways to establish prior authorizations, make work flow more efficient, take patients initial medical histories and help doctors mine data.


There are 8,000 new research papers published each day, and AI can mine that information faster than any individual physician ever could, he says. If doctors are better informed that will lead to better patient care. So, for instance, an oncologist could find information on new viable treatment plans that might work for a specific cancer patient that are not among the usual options.


AI could then help the physician get access to that therapy and help navigate the payer landscape to ensure the treatment is covered by the patients insurance. Thus, AI could speed up the adoption curve for new therapies, he said.


The biggest enhancement AI has to offer is around patient support. With its speed, AI holds the potential to allow doctors to discover other, and possibly better, treatment options for patients.


Increased use of AI in healthcare would improve both decision-making and clinicians ability to determine the best possible course of action, but the goal of such advances is not to replace human caregivers.


Envision a future where voice-activated technology and software-based dictation services help physicians cut the time they spend on EHRs.


And the future is now. An AI platform that is widely recognized by the public is IBM Watson, which is being used by healthcare systems including Memorial Sloan Kettering Cancer Center and UNC Lineberger Comprehensive Cancer Center.


For instance, Kettering said its clinicians and analysts are partnering with IBM to train Watson Oncology to interpret cancer patients clinical information and identify individualized, evidence-based treatment options that leverage its specialists decades of experience and research.


Original headline: Dont fear the robot: Artificial intelligence could be a game-changer for physicians and their patients


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