As healthcare reimbursement models evolve, Providence, a non-profit entity, must adapt to various payer models while adhering to its mission and quadruple aim. Unlike for-profit insurers, Providence’s decision-making is grounded in mission-driven principles rather than competitive profit margins. This requires a strategic approach to procurement and inventory management, especially amidst challenges such as drug shortages.

Current Challenges

Lack of Centralized Inventory System: Unlike supply chain management, which benefits from centralized systems, pharmacy procurement currently lacks a similar tool. The complexity of pharmacy regulations necessitates a specialized inventory management tool to balance system coordination with regional oversight.

Manual Knowledge Acquisition: Pharmacy buyers currently rely on manual processes, such as walking the shelves, to gain knowledge. This inefficient method is driven by limited tools and is not data-driven, leading to challenges in maintaining accurate inventory levels.

Pharmaceutical Waste: Fragmented ordering processes and reliance on spreadsheets contribute to significant pharmaceutical waste. With over 50 locations, the manual oversight process becomes a major barrier to identifying and capitalizing on savings opportunities.

Transformation Opportunity

To address these challenges and continue generating savings, Providence is implementing automated tools to gain a comprehensive view of inventories across the system. By integrating hardware and software from two vendors, we aim to:

Enhance Drug Shortage Management: Better management practices will ensure the availability of necessary medications, reducing shortages and improving patient care.

Optimize Inventory Levels: Technology will enable us to maintain inventory levels that align with anticipated utilization, minimizing waste and inefficiencies.

Improve Caregiver Workflows: Automation will streamline workflows and eliminate manual processes, enhancing the efficiency of pharmacy operations.

Projected Benefits

The implementation of this two-vendor solution promises substantial benefits:

Cost Savings: Conservative financial estimates project significant savings over seven years, with a potential to lower overall costs.

Improved Patient Experience: Enhanced drug shortage management and perpetual inventory management will lead to better patient outcomes.

Optimized Caregiver Experience: Caregivers will benefit from improved workflows and reduced manual tasks.

Enhanced Oversight: Better inventory oversight will decrease reliance on workarounds and alternative therapies due to medication shortages.

Implementation Plan

The complex implementation plan spans two years and involves staging in over 50 locations. This plan is strategically designed to align with existing projects, such as EMR go-lives or other IS conversions, to mitigate additional risks and complexities.

Elie Bahou

Chief Pharmacy Officer / SVP | Pharmacy Operations

As Chief Pharmacy Officer and Senior Vice President at Providence St. Joseph Health, Elie Bahou leads with a focus on advancing pharmacy services through innovation and strategic management. His commitment to healthcare excellence drives initiatives aimed at improving patient outcomes and enhancing the overall patient experience within Providence.

For more information about our initiatives or to discuss how these changes could impact your organization, please contact us directly.