In the “old days” of health care, supply chain management was largely an operational issue. Today, we’re scrutinizing our supply chain—and basically every other aspect of health care—to ensure we’re reducing costs to deliver the best possible value and care to our patients.

In 2011, orthopaedic surgeons at Howard County General Hospital felt the medical center was paying more than it should for hip and knee implants. So they performed a systematic team review of the implants, vetting them to verify their quality, determining their value to the hospital and what they felt the hospital should pay for them. Then they told the vendors that the hospital would no longer pay more than a capitated price. The vendors agreed to the price cap.

A couple of years later, the Johns Hopkins Joint Clinical Community, a group made up of orthopaedic surgeons from across the health system, applied the same group evaluation process to total joint implants, resulting in a capitated price program estimated to save the Johns Hopkins Health System $1.5 million a year.

Through efforts like these systemwide, supply chain already has saved about $50 million of a targeted $80 million to $100 million. Ron Werthman and his team have taken the normal business process of buying supplies and converted it into a very powerful, impactful strategic tool.

Our self-scrutiny is playing out in other ways too. In the “old days,” Kim Sherbrooke, the new chief operating officer of the Office of Johns Hopkins Physicians, would have been hired to manage the necessary operations of the practice. Now, we look to our chief operating officers not only as excellent managers of our work processes and systems, but as our strategic partners in building new capabilities to manage unprecedented change in virtually all that we do. And so, yes, excelling in change management will be the key to our success as we all maneuver through this time of reform and transformation. Johns Hopkins has maintained an excellent reputation for well over a century. But health care demands that we continually redefine ourselves to be more valuable. I look forward to sharing new highlights with you in the next issues. 

Patricia Brown
President, Johns Hopkins HealthCare