How do we end healthcare supply shortages?

By Joe Hannan | Fact-checked by Barbara Bekiesz
Published July 6, 2022

Key Takeaways

  • Ending the current supply chain crisis in healthcare will require smarter inventory management, infrastructure improvements, and bringing elements of US manufacturing back onshore, two experts told MDLinx.

  • Taking these steps is critical to ending rolling shortages of supplies such as PPE, anesthetics, and necessities such as IV contrast and IV bags.

  • Providers can focus on improving efficiency at the point of care to lower supply demands and overall strain on the healthcare system, but many of the long-term solutions will need to happen at the levels of industry and government.

First, it happened with personal protective equipment (PPE). Then, propofol and a list of other anesthetics, followed by famotidine injection and doxycycline hyclate injection.

These were just the supplies that dwindled between April and July 2020. The months, and years, ahead would see more such shortages.

These shortfalls were also part of a trend.

According to a 2021 American Journal of Emergency Medicine study, the number of drug shortages increased annually from 5 to 31 between 2015 and 2019. Then, in only 6 months, the FDA announced 27 new shortages in 2020.[]

Two years later, the trend is unchanged. In May 2022, MDLinx broke the news of an IV contrast shortage that rocked the US healthcare system. And in June 2022, even basic necessities such as 10% dextrose injection, lidocaine hydrochloride topical jelly, and 0.9% sodium chloride irrigation made the list of drugs in short supply, according to the American Society of Health-System Pharmacists.[]

How do we keep the US healthcare system supplied? According to two experts who spoke to MDLinx, the solution starts with building more resilient healthcare supply chains—no simple or quick task.

Immediate causes

David Dreyfus, PhD, an assistant professor in the supply chain management department of Rutgers Business School, told MDLinx that healthcare is subject to the same supply-chain pressures as other industries. COVID-19 shifted demand patterns, making it difficult for inventory managers to determine accurate levels of groceries and PPE to order.

Combine fickle demand with congested ports, labor shortages, China’s zero COVID policy shuttering factories, plus inflation, and you’ve got a recipe for a supply-chain crisis.

"Even if things are going well here in the US, we rely so much on the world to supply us different parts and materials that complications can still arise."

David Dreyfus, PhD

Further complicating the issue is the life-and-death nature of healthcare. That’s led some healthcare systems to hoard supplies, and others to contact distributors to request as much as they can receive.

“Then it really falls to these distributors, these manufacturers, to somehow ethically distribute it. They know everybody’s going to be getting less than what they’re asking for because people are trying to hoard,” Dreyfus said.

While providers grapple with this problem in the present, it also has roots that predate COVID-19.

Older causes

Chaodong Han, PhD, a professor of logistics and chair of the department of business analytics and technology management at Towson University, told MDLinx the current supply-chain crisis was actually decades in the making.

For over 30 years, the emergence of China as a player in the global economy has been driven by Western outsourcing of manufacturing. With a highly educated and skilled workforce, China has become the West’s go-to producer of myriad consumer goods as well as healthcare supplies.

The other long-term contributor to the supply-chain crisis is labor, Han said. Just as rising standards of living and wages in other fields lured workers away from manufacturing in the US, a similar trend is happening in China.

"Nobody wants to work in a manufacturing shop. In China right now, a lot of people don’t want to work in manufacturing plants any longer because their salary rate is not that good."

Chaodong Han, PhD

Combine shifting workforce trends with the higher cost of living in former manufacturing hubs such as Shanghai, and now Chinese manufacturing is shifting to the northwest of China, making distribution even more difficult.

Building a more resilient supply chain

Bad news: Just as the current supply-chain crisis was decades in the making, undoing it will also take a comparable amount of time, according to Dreyfus and Han.

Dreyfus said that the US needs to shorten its supply chains. Using PPE as an example, he said that from a distance, it seems like an easy fix: We should make it ourselves. Fair enough, but where do we source the rubber, which doesn’t grow in the US? And while we may produce cotton, we export it for processing, and then import it back for manufacturing.

Providing another example, even as the US makes strides to bring chip manufacturing onshore, building those facilities, hiring the workforce, and then training it will all take years, Dreyfus said.

Some vertical integration will make our supply chains more resilient, but Dreyfus said that for most industries, complete vertical integration is out of reach.

“We still have these long global supply chains where things are criss-crossing,” Dreyfus said. “I think it’s a great idea to shorten supply chains so things aren’t criss-crossing quite as much, but to think that we can become more insular and self-sufficient, especially in the near term, is very difficult to accomplish.”

Han said that manufacturing of essential goods needs to be brought back on shore, which will require time to retrain the labor force and bring suppliers back on shore.

"The government needs to step in with tax incentives."

Chaodong Han, PhD

With China’s labor advantage eroding, companies may begin to consider bringing manufacturing back onshore. And tax incentives just might sweeten the deal.

“There’s a lot of opportunities there,” Han added.

What HCPs can do to help

Much of healthcare supply-chain management takes place in C-suite offices, far away from the point of care. But Dreyfus said there are things providers can do to diminish the impact of the current supply-chain crisis.

He encouraged healthcare professionals (HCPs) to think not in terms of supplies, but processes. Processes move patients through the healthcare system, and the longer they’re in it, the more demand they create for resources, including material goods and provider time, both of which are in short supply.

What can you do to make a follow-up visit unnecessary? Could the issue be resolved with a telehealth call? Could it be addressed in an outpatient setting? And is it possible to send a provider to the patient’s home?

Improving clinical workflows can also ease the overall burden on the healthcare system, and consequently on its supply chains. For example, Dreyfus said, a patient completing paperwork in a portal ahead of a visit could ensure optimal use of the provider’s time during the visit. All concerns are documented in advance, and then addressed during the visit.

Even something as simple as more efficient scheduling will help. Offices need to utilize smart scheduling systems that know how long the average visit takes for specific complaints, and then schedule patients accordingly.

“All of those things add up to providing better care and freeing up more resources,” Dreyfus said.

Han encouraged providers to recognize the drug shortages as a national crisis and to lobby the federal government for intervention, similar to what we saw with the baby formula shortage.

"The market will address it, but in the long run. In the short term, the government needs to step in."

Chaodong Han, PhD

What this means for you

It will likely take years before healthcare’s supply-chain issues are resolved. Meanwhile, providers can strive to get patients through the healthcare system as quickly and efficiently as possible. They can also advocate for government incentives to bring more critical supply manufacturing back onto US soil.

Read Next: Individual actions can mitigate the medical supply chain crisis
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