Healthcare Driving Sustainable Purchasing Decisions
Jeffrey Brown | Healthcare Purchasing News
Over the last two decades, the healthcare sector has become increasingly aware that how we care for patients, staff and the community, along with the impact we have on the environment, are undoubtedly connected. It's no surprise that caring for the environment has become a natural extension of our work to achieve the triple aim: better population health, improved quality of care and financial savings.
Practice Greenhealth has worked with over 2,500 hospitals committed to improving environmental performance. Together, we've zeroed in on areas where facilities can make significant impact. Over the years, we've found that purchasing is one of the healthcare sector's biggest areas of opportunity and risk.
Green Purchasing Is Smart Purchasing
Today, we know that certain materials and products can have negative impacts on patients, staff and our communities -- impacts that run counter to healthcare's healing mission.
Some products contain harmful chemicals believed to play a role in rising chronic diseases and conditions, including some cancers, birth defects, learning and developmental disabilities, infertility, asthma and neurological disorders. These chemicals can escape from products and make their way into our bodies and the environment.
Others use vast amounts of energy and water and produce tremendous waste, costing hospitals millions of dollars that could be saved through smarter purchasing decisions. Virginia Mason is a powerful example. This Seattle-based hospital saved $3 million in supply costs over three years after instituting a reprocessing program for single-use devices.
Greening The Supply Chain: A Game Changer For The Health Care Industry
Practice Greenhealth's Greening the Supply Chain Initiative was launched in 2011 to accelerate the use of environmentally preferable purchasing practices and drive a shift in the market for safer products. Bringing together suppliers, group purchasing organizations, hospitals and health systems, we've made great accomplishments in four short years.
Identifying Green Products And Suppliers
Our first order of business: Make it easier for purchasers and suppliers to identify, source and purchase environmentally preferable products. We developed Standardized Environmental Questions for Medical Products, Version 1.0, to help drive the contracting process. The questions cover key environmental priorities in healthcare, including packaging, manufacturing, use and the end-of-life impacts of medical products. Next, we created a supplier directory to assist hospitals with safer purchasing decisions. The directory is a great source of information on environmentally preferable products and services.
Measuring More Than Initial Cost
Purchasing decisions can focus too narrowly on the upfront price for medical products and services. Evaluating only the initial purchasing price is not sufficient for controlling costs and delivering better care.
When it comes to purchasing, there are submerged costs -- such as delivery, energy, water usage and disposal fees -- that are not considered during procurement decisions. Hospitals may actually be paying more in the long term for a product with a lower purchase price.
Practice Greenhealth has started developing a new tool that measures the total cost of ownership for healthcare products and services. It will bring this and disposal cost information to the surface, allowing hospitals to make purchasing decisions with a more accurate picture of what a product will cost over its lifecycle. The Total Cost of Ownership Tool will be ready for hospitals and health systems to use in the next year.
Still More To Be Done
As a result of our work, we've seen increased demand for products with reduced environmental and human health impacts while driving efficiencies and cost savings across the entire sector. However, a survey of hospitals commissioned in May, 2017 by Johnson & Johnson and Practice Greenhealth shows there is room for improvement. Nearly 41 percent of respondents said the healthcare sector is doing "poorly" when it comes to leveraging its purchasing power to buy more sustainable products and services.
With 17 percent of the domestic market, healthcare wields major purchasing power. This puts hospitals and health systems in an excellent position to demand safer, healthier, more environmentally friendly products from vendors. But, we can't do it alone. The business community plays a significant role in greening the supply chain.
Collaboration: Key To Driving Change
To continue supporting the healthcare sector in making sustainable purchasing decisions, it's critical that we make it easier to access green products and services. Collaboration is key to our success.
Practice Greenhealth has made significant progress by bringing the business community together with hospitals and health systems to drive change. We proactively engage businesses, large and small, in promoting products and processes that are environmentally safe. We are committed to helping suppliers and manufacturers meet the demand for greener products and services and stay ahead of the curve on the latest environmentally preferable purchasing processes and innovations.
In addition, the Market Transformation Group -- convened by Health Care Without Harm and Practice Greenhealth -- works to leverage the aggregate buying power of participating health systems and accelerate a market shift across the healthcare supply chain towards more sustainable products, technologies and services.
You Can Adopt Greener Purchasing Strategies, Too
Hospitals can improve the bottom line and increase patient and staff health by going green. Environmentally preferable purchasing is a transformative strategy for today's hospital, making operations more efficient and providing visibility for a commitment to environmental and human health.
That's why many hospitals are taking advantage of the environmentally preferable products available.
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