Reducing Avoidable Hospital Days: Supply Chain’s Role

Structural shifts in the healthcare landscape since the pandemic are creating a new challenge for U.S. hospitals: a potential shortage of staffed beds. This challenge also comes with an opportunity to achieve operational savings by reducing the number of avoidable days in the hospital. And, as with many things, there is a supply chain connection. 

First, the problem.

Compared to before the pandemic, there are now 16 percent fewer staffed hospital beds in the U.S.  

The current mean hospital occupancy rate in the U.S. is just under 64 percent. With an aging and increasingly sicker population, we could see that rate jump to 85 percent as early as 2032. At that rate, the U.S. would officially have a national hospital bed shortage. 

On the other hand, according to research by The Advisory Board, the majority of U.S. hospitals (71%) are keeping patients on average one half day too long. This translates annually to more than 9 million so called “avoidable hospital days,” which are defined as the time spent by patients beyond national length of stay (LOS) averages due to clinical or discharge related delays. 

Any unnecessary LOS extension translates to higher labor and facility costs for hospitals. It also increases the risk of patients developing hospital acquired conditions, which increase costs for patient care but without commensurate reimbursement. 

Now the opportunity. 

Reducing the number of avoidable hospital days has great upside potential for U.S. hospitals and the healthcare industry as a whole, not to mention patients who would prefer to be out of the hospital sooner rather than later. As an example, The Advisory Board calculated that a 400-bed hospital that is able to reduce length of stay by one day could realize savings equivalent to adding 65 staffed beds. Extrapolate these figures out to the entire U.S. hospital universe, and it would cover the annual costs of staffing, beds, and other resources for 86 regional sized hospitals. Nothing to sneeze at, in or out of the hospital.

How can supply chain help?

Considering how products selected for patient care can reduce LOS is nothing new for value analysis professionals, but in light of this data, supply chain leaders may want to consider giving it some added weight. Plenty of manufacturers claim their products can reduce LOS, say by reducing infection rates. Perhaps this is an opportunity to explore opportunities where you can control variables enough to tie product pricing to the actual achievement of supplier claims.    

The challenge of avoidable hospital days is sometimes related to reduced bed availability in post-acute facilities. For example, since the pandemic, nearly 700 nursing homes have closed. A possible solution is to discharge more patients to home-based care. As supply chain leaders, consider how you can support your own institution’s home care strategy. For example:

• Do you have the logistical capabilities – in house or through partnerships - to deliver needed supplies to the home?
• Are you able to protect patient data given that shipping information now includes patient home addresses?
• Can patients and/or their caregivers requisition products as needed?

Medical error rates often increase during times of transition from one care setting to another. Supply chain can support these transitions by making sure the right products are available to patients and their new caregivers during the transition. Supply chain can help prepare discharge packages that include the basic supplies and medications that patients will need during and immediately after the transition. Whenever possible, standardizing the products used in the hospital and the next care setting can also increase patient and family member familiarity with the products and how they are used.

These are just a few ideas for reducing LOS and helping make sure the right resources for patient care are available when and where needed. What are you doing in your hospital?   Email me at [email protected].