Healthcare Value Analysis: Steps for Achieving Better Results

Healthcare Value Analysis: Steps for Achieving Better Results

There are many different iterations that value analysis has morphed, evolved, and emerged into leading up to 2022. Value analysis is predominantly applied to products, services, and technologies in the healthcare supply chain. The primary focus of value analysis practitioners is working with hospital and/or system-based value analysis teams that are assigned categories of products and services to review. The main goal is to validate the efficacy of these products and services but also to assist with the selection of the right product used in the clinical environment. Lastly, healthcare value analysis should be a catch point for savings and quality improvements while performing various reviews, studies, and evaluations on an ongoing basis.

What Should VA Program Goals Look Like for 2022 and Beyond to Get Better Results?

I thought I would just outline what health systems should be targeting with their value analysis teams and practitioners in 2022 and beyond to make the most of their value opportunities and not leave any dollars on the table or miss quality improvement opportunities.

  • Your Value Analysis Program Should Have Goals. If you are a value analysis or supply chain leader then you should have goals for all your programs from contract to inventory, and yes, to value analysis as well. Without solid goals, your teams will just be running as they always have and historically this is when value analysis programs tend to sputter out altogether. Setting savings goals by team or establishing better objectives for improved review times for new products are two simple examples of value analysis goals that can go a long way.
  • You and Your Teams Should Have Training At Least Two to Three Times a Year. Yes, you may be an outstanding practitioner/leader of value analysis, but you should never underestimate the fact that your teams are ever evolving and require training too. If you want to have the same results, then just keep doing the same things repeatedly, but if you want your program to grow and evolve then train your team members in newer and more advanced value analysis skills.
  • Let Technology Make Your Job Easier. Let’s face it, value analysis is a sub-section of supply chain. VA procures millions of dollars in supply chain purchases but normally does not incur many budget expenditures. CFOs like this aspect of supply chain which many times limits supply chain to spreadsheets. Spreadsheets are very versatile tools but are also very limiting with roll-ups of large purchase/inventory data, and new product request information is far too vast for the common spreadsheet in 2022 and beyond.

The solution is to look to the value analysis software on the marketplace today to take the burden off your VA and Supply Chain Analysts that support VA. Yes, they are going to worry that the new software will somehow replace what they do, but the reality is that instead of your VA Practitioner and Analyst spending 80%-90% of their time crunching data, they can now free up their valuable time to spend on true value analysis with the end customers instead.

  • Get Back to Core Value Analysis Reviews. Back when I started in the healthcare supply chain 30+ years ago, value analysis was commonly used to review existing contracted product categories to reduce costs further. With the evolution of the group purchasing program and new product evaluations and recalls, value analysis teams and practitioners have gotten away from these cost and quality reviews. It is time that value analysis take a step back and open up 20% to 40% of their agendas to these major category reviews again to further reduce costs beyond contract price. There are big dollars sitting there, but without any formal review these dollars will be lost forever year after year. Remember, you could have the best price on a Rolls Royce but your costs to maintain it are always going to be extremely high. There are lower cost alternatives that will not only reduce costs dramatically but also improve quality. You just have to initiate looking for these now in order to gain the results today and in the future.

Value Analysis Is the Game Changer in 2022 and Beyond

Value analysis in healthcare is just scratching the surface of the great value that can be brought to the healthcare supply chain and the organizational bottom line. Many don’t realize this because it has been pigeon toed into only handling new product requests and recalls at many organizations. The organizations that start to think differently and take the next step with their value analysis program are going to reap huge benefits beyond the contract savings they are getting. Don’t overlook the added value that value analysis can achieve today!

About Robert W. Yokl, Sr. VP of Value Analysis & Supply Chain Solutions
Robert is the Program Leader for SVAH Solutions that provides value analysis, clinical supply utilization, and savings validation tools to help organizations to gain the next level of savings beyond price and standardization.

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