Rx for smart hospital purchasing decisions: The impact of package design within US hospital supply chain

The purpose of this paper is to examine the impact of packaging design on purchasing decisions in hospitals and to identify inefficiencies in the US hospital supply chain. Recognition of inefficiencies helped to directly relate to the effects on critical factors of operation such as environment, traceability, and logistical ease which significantly add to the cost of health care.

A survey instrument was designed to be completed by purchasing agents in US hospitals and clinics. Statistical analysis was then applied to the survey data to draw inferences. In addition, existing studies of best practices of supply chain and packaging design were considered to determine what may be applied to the US hospital supply chains.

Analysis showed very little correlation between packaging requirements and hospital supply chain design. The data from the survey also supports the supply chain literature that the healthcare industry in the USA has been slow to adopt inventory efficient systems like just in time and lean development, including product tracking through bar coding and radio frequency identification devices; though most US hospitals have the capability to migrate to such a supply chain system.

A small number of respondents were involved in the survey. Such efforts were limited by the availability of participants which were primarily supply chain procurement staff in various large community hospitals in major metropolitan areas across the USA.

There is a substantial opportunity for management of hospitals to educate their purchasing agents on the benefits of collaborating with their suppliers in order to take their relationships to the next level to lower costs of the US hospital supply chain. This has been shown by the responses in support of critical factors of the supply chain. Case studies have shown some hospitals are leading the way towards efficient use of their supply chain strategies.

Analysis of survey data revealed that packaging and environmental friendly suppliers/medical products do not currently play a role in hospital purchasing decisions. Nearly, all of the community hospitals in the USA that participated in the survey do not value packaging as providing a means to a more efficient inventory management program.