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Supply Chain Resiliency Guide MEMBERS AND PARTNERS. ‘The past toe years hve rveales thecal oe of tealthear supply chan management and now esieney satepes ae ecessay for ‘nel costefectve an hgh qualty paint cre. Wile tho dustry has made progress andimprovemets tacking mary bstates, persistent Chalerges and an uncertain climate eran. {uldng on lessons lames. eset to undetetand how supply chain We asked ~and you answered thecal Hundreds of US healthcare lenders rom across the supply chy ‘pera andin cel ols rece provided valuable sights {er Premers 2023 Supply Chain Reclloncy Suey Accordng 1 the ‘worsen or remain he seme over the er yea cng ineeasedabor costs ‘Shortages as top concerns, What foows is Premiers 2023 Supply Chain Reslency Gul, inclusive of key Werds, leamings and recommanded states t tackle today's ‘most pressing supply chain challenges and enable long-term suceeys fr healthcare providers. ‘Survey insights trom a broad cross section of healhcareand supply chain leaders tom thi Yesutce a suppor decsonmaking on sx revetion {nd mitigation srteges and comprehensive recommendations fr Derepectives and dat sets that we as an industry willbe posttioned to drive 4 supply cha requires innovative solaions o adress ily end cost reduction via gree divert of manufacturing lind supplies, actonable data and technelogyenab emer, and lacing {dvccary efforts Atthe same ie, macanng focus and preparedness ‘ort for sasters and lruptons wil be val maneging suply chain ‘Sabin 2023 and beyond Toaay supply chan leaders are focuses on ecision-making that enables rik prevention mitgstion stateses end ‘trough thee ders prapectves and deta set that we willbe postioned {e drve mearingfl are lesing improvements in heathcare Writer and plosopher Grorge Santayana fameusly sald product shortages, bullding heltver markets and tacling cost pressures ‘etn paneeringsaegieeandvalue-rven parneship. Our foros on lions tha makes dference for ou embers, thar pater and fammunties wll never wave, “To rete success, David A. Hargraves ‘Senior Vie President of Supply Chal, Premier ne TABLE OF CONTENTS 04 2023 Premier Data Highlights Supply Chain Challenges, Changing Landscape 09 Solon o Tage Product Avalabilty and Supply Chan Resincy 11 19 “Technology Enablement Healthcare Suply Chal 20 22 lating brug Shortage: Novel leas fran Unprecedented Challenge 24 Disaster Preparedness and Response 26 Navigating Worforce Challonges 27 Leading Advocaey ors 30 ‘stressing Societal esuet 2023 PREMIER DATA HIGHLIGHTS SUPPLY CHAIN CHALLENGES, CHANGING LANDSCAPE ‘What do you anticipate will be the overall largest operational and financial challenge for your organization in the next 12 months? Please rank. Please rank (hi wot risks to healthes st to lowest) the items you see being the ‘supply chains over the next 12 months. ‘survey respondents alo antiipted a broad range of potest ik oreathcre supply chain this yee ~ neat ‘conomle ana mara factor; raw materale cons: ene ansgoraton, geopeltel and cybersecurty tess, See Sorat See meee meee mame ey peeves “Sul ontispate supp chan interaptions. Though godt ad esos nah splay ay wee si expert Bokaders “Nothing has incated a repieve othe constant changes we are ‘oncology therapies has only added to my concern” "aw matt shovtages continue with cto, aluminum and ste! being compromised The aber challenges, sing costs, fan ad shiping ‘lays continue aswell” “Tm concemed shout vendors xting cern supply categories, or exting certain product ines that il stess national aarp “Ceopotcal tensions and contnued infaton are major conces” Trenspartation i laays a wor frm. laity to cost” ‘na manufacturing is nereased ouside of Ai and closer to US sal ‘thre il be supply chan ste. = shortages of hundreds of dfferent product, On average, PCA {F600 unique product ans 200-300 drug ar morth. Thera of product Backorder is cre double he rate pro he panei nat 2020 [Adationaly these shortages have arguably become more challenging to manage, PNG Als data estes that shortages are largely siting tary, multea pervasive issues oan unpredictable set of re Produclaeategaresevey math fn-the op 3 produtcerptone oer thslaet 12 month respondents Provides robust st af hudeode of uniqe tems but with many Siganzatons seing challenges forthe same products alto patent cae Heattheae provers se 25 times more tkaly to experience shortages fon products nureathy markats when ecaegaryhas two ot fener ‘anufacuror representing 80 percent of market shar, aoearding © Top product disruptions inthe last 12 months (Sampling of common responses): Suri touriques Chest bes and drainage contrast med Vatious IV fis, bing and syringes. Phammaceutcas ncludng albumin abut, oncology age and more Ctr recent product categories in daruption include etal sea ‘lectoce, blood and faa warming Wis, and aortic ballon catheters. that downstream clncal an operational mpacts~farter burdens ‘nd werkforce challenges More than 75 pereent of US. heatioate leaders Said her teams ae spending 10+ hours per week mibgntng suppl eta fhallenges ara sharages,eccrdingto Pree’ survey. Thityseten percent sald they are spending more han ZO hours and some organizations ‘ereporing 8 hows spert weekly maragig product Brality concerns How much time is your tem / organization spending on mitigatn Supply chan fk of navigating product daruptons? ° zero bese 041) ‘supply chain chalenges ar also having a tet impact on patient cate ‘early haf of survey respondents (8.6 percent) sid hey have nao {anea or reschedule cases oprocedute least gute h 2022 ue to peduct shortages 1n 2022, how frequently did your organization have to cancel or reschedule cases due to product shortages? 08 Wea pasevewenti Given the crrnt mazoeconomi eitonment~ bth iw andi the ‘tue ~vesitency means more han jst supply avail. also needs to facer inane, Product shortages ave proven cost, Inpharmacy alone, PING Al" data saws $3.1 bllon in nreased hoeptal spend in 2022 edt purchases of substute products. (when te ong product way unavaabe ue to shortage Furth {Ss oted by one survey responcert:"We saw mare than $1 mllon a ‘stated Speational a nares ise fcanceledresehedled eases dueto product shortages n 2022" (Sampling of open-ended responses) + "ack appropiate saing in th department and rgnization” + ‘Managing dug shortages” + ‘Unknoun suppl ruption wt itl tme to react” “another pandemic. + "manca pressures rom aber supply costs technology costs.” + "ack of ivestyin the suppy of products and meteals. The potental fe patie problems to cause a majr asap, special china” + "he bit to more esi forecast a demand problem. ith _greaternatin we cn sch talloate produc but we need fine to mam sttt= + "ing unable to meet the hetcare needs of ur patents IF COWD was any ndcaven, heaved of PPE keep ‘eather providers ste wile roving ear fo hose in ned” SOLUTIONS TO TARGET PRODUCT AVAILABILITY AND SUPPLY CHAIN RESILIENCY ‘The good news? Ther ave been heticare supply chain evluing sonslesmed and notable progress made over the pat thre years ~ and while more workisyet oe done the ge emerging om pander thant was ete US. heateare providers are deploying diverse and innovative strateges to help reduce supply and inflation risks across categories: ‘62 percent are mult-soucing product categories for greater redundancy and percert are geographically divestying the supply sources and contact. ran haf are developing supper key pecformance nesters, erhancig suppl contract ems and conditions, en incressing inventories for :4 SAU rmonalzton (49 porcont, aster preparedness anc response programs (84 percent and leveraging technology and faspercen, DIVERSIFICATION OF OUR SUPPLY CHAIN Heattheae ender survey respondents ranked “assessing the supple’: ‘unerabity ta dstuptons ae themast mporant factor when analyzing suppl rise “The pandemic provided a dramatic casein pont: future forward supply chaln and reduce overrellance on ary sgl suppl, county o” region, Premias conwact portfolio includes ~3480 active contacts with 1460 a parinersn 590+ eategorins that manufacture in dverse atone, cluding the United States, North Aetics South Aerca, Europe Area ana Asin, Overall Premiers commits to coteaeting wth polls that demanstate manufacturing eilancy edundancy sre ‘ual ivsatonts, [Adonally, ado accelerate accesso atic roduc, Premier ‘atablihed an anpedited sourcing process fo fat teck contacting product catepois experiencing sorages. This accelerated sowing Blecaton expected to move ta allcaton or curert i shortage ‘tthe gal rapily increasing aceas to needed supton, [After challenging 3 years, he road to sup Innovative surelng and caneating states ‘oletons that ower bar able supph. chain success cludes crealve partnerships and rst ent suppert cast savings and drive Domestic Manufacturing “Three out of four heathcre and supply chan leaders say domestic {erations sippy chan elleny sates eczordngo 298 ceayingacst . © a0. veringerat . ° Domestic Manufacturing - sampling of responses: “We ra moving ta vendre who manuteture product in North Americ: “eopoteal concerns aa vty el and wil ely be the cause of fare disnptons” “Need mere onshore and diverse suppliers that can provide product without vermng stout shipping east nd delays “We have area started loking to contract wih domes pater. We sre aso chalenging tase parte’ dnng te veting process fo show tho resiioney plan and contingency plans agains fire csuptions ‘Ths includes oth ished products and raw mats needed to mae theproct” “our erganization supports domestic manufacturing: however the "fear the mamenes of 2020 wil fade ard cos wil become the most Premls bel stata successful supply chan strategy includes domes and diverse manufacturing. Our plsopty I ote move al overseas Sversiy For eritalnethcae prots and drugs, ere shoul Be tee or ror lobaleuplors art ast one US-sased ance nearahore source, ‘Sapo enn professional shoul alo cne.ser comming some porton thr annual purchasing volume (2-30 perce to those anshore of nearshore sourees to help este apropte backstop frou patents. Recognizing that canbe cost prohibit for manufacturers who ate competing a mest riers mare, setanable slates for dome Production mast decrease brat ely ~ namely the Une and coat to frter the marktplace realh systems pool eaptal and corm olor tem purasing to wontvie the comes produton a rial product. The Up ‘tor hquaty aggregates demand forecasting and commitments to uy give manufactures the surety needs To expand production, moderne feces and dive lnovetions these natanees Premier ISalso leveraging existing production capa and automaton fra more austanable approach to US-based production that aide pee Sndertng wih chee labor and amore ale approach hat dest [cisncs,Premir andor members are bolstering domestically made ‘medial supplies and pharmaceutias fr providers an patints~ while ‘pporting je creation and stronger lea economies. SS = Via these natives, heticae prover cn very sup sources a 2 pce point competitive wh overoeas anufartuning. nection ese “Suppliers have mereased the prosaton tote protect provie's ftom shortepe= Investments fom Pemer and ts amber serve as replicable adel for ‘thers oncent more geogaphialy diverse and domesteprosucton, id You Know? Manufacturing vestments fam Premier and our members are ding Innovatv and auomates production processes. Frinstance, the ‘Dehoyl parsers state orthe-ar production faciy oui of ‘Krome Tennesse, 'svansormingsvadtionllborinense seems process t automated prosuction wth the ea 10 ‘roduce te gow every second hts ealaboraon, gowns are ‘Secigned to health ayseme speifeat ons, arate parreshp ls ‘xgected a produce more tan milion domestealy manufactured ‘ome annual Investments in automation can help ou nation produce goods and compete wi owecant coustes nen enveonmert whet labors hard to-come by. Automating te manufacturing process helps cea [Sharer suppl chan deving grater elency by nereang production capaci reducing cost and alloning domestic compares te compete ‘more ffetvelyonagobal eae Watch his wdeo for more onthe DeRoyal production fcity and our Iimovaton in setion Direct Sourcing ‘avalabily of wal heslthcare suppl. rom producton to elven healthcare proces ae taking’ hol vio the etre heabheare ‘ale chain ep make more rable and dependable key sategies nclae dvesiteation of supa, production capabilities {and varspotation processes, including etetso-nanufocturrsourng ewarabuye nd apecal astibuton arangemerts and ere athome With dst sarsng, healtwear organizations can {rel beads-upupsates onary issues, rutgatg the sks of shortages Promier’s dec sourcing subsidiary $25 Global enables accesso tp, ‘gh queliy supplies, creating ieuonless and direc relaonship, Between suppers and ther buyers ‘328 Global can alo exccat forward buys ahead ofa shortage stuation 2s the backbone fr our PPE foward buy progta, S25 Global celivred mmorethan Toe milion asks ag esprators and 66 rallon gowns dung supply ode. Going actor rect alsa dosetmsen sacrificing quality All roducts ‘come [rom vated an inspected suppbers an se made acorn ‘urmambersspectieations, bull a ormuly of hglrualy product ‘at meet provider’ stingent rca standard ‘528 Globalis desieated to consistent expanding ts produc offerngs Sipps meatngileos svngr opposes ar re ip ‘828 GLOBAL'S DIRECT SOURCING VISION + Source commodiy products bth domestcaly rd nternatoray for Pamir members + Provse meaningful cot reduction apportion + Provge Premier members wth exlsive global suring and ‘anufacung eapnlity, Prem members willbe alo defi, approve ed refine produc specications (Sourcing to Speciation oF 257) + Establsh the capably to supportlarge Premier members to receive ‘ect colar shames ting adtlora eau out ofthe supply chan. + Negate the riks of product shortages due to eter ‘tor such ae pendemis or govemment shutdowns diet ur deacttoracory relationships amd e-Commerce Capabi Beyond verthing supply capabitis, Premiere streamlining the ay 18 each more than $435 dillon texas for supplies. a Premier survey fom conveniently access high-qualty PPE and other healthcare supplies ~ ye ‘Grough recor procurement channels ter sucht Premle e-Commerce platform created facitate a implied buying experience. Stockd i designed exclusively for Premier tmambers as & convenient oiton fr accensing trusted products and ded savings fom contacted supplrs Stocks goalie simpli the purchasing experince by supplemerting Tradiona GPO purchasing witha conventent ana sect pucnasing plstform From sage heath system toa promde on the ce cornu, 35y access te ect sourcing to help lower purchasing costes ponders Purchased Services ort, urshased secu can account for pt 36 peeent of ‘nen compan thir paty purchased ervices to prosucs he total cost ofthe sence neal ue this hesences market hes been ht partially hard oer the st few years, ether an organizations beginnings purchased series journey orhas Can be age opportunity or bth aheltoare provider ~ and the nations Beriomarc an tpenacan eg rgrion pert and ‘tackling purchased services has been 2 complex challenge decades nthe tore than wort te for, + Alongside the powe of Proms national 6 contrets, ganizations partering wih Premers Conduct pursed senses platerm fave saved as muchas 21 petcnt (ight avscage) across services Etegores dung the pandemic tug combratin of GPOTocs, Sercee-spetfe contact. + conducts enablng shes, compete serves maa ~eeating ‘row oppotities for sma Gers spire and Mlping hosp InvetIecaly aces many ferent catgares of they buess + Historically, puchased services benchmarks have been ard o come by With a comprehensive technology alatfarm, Conduct provides anelts, aly measure purchased sewices usage and span. Addonal ts ‘manage savings targets ~ a tong means courte into, See how Conduct combina a powertl technology platform, GPO fr eles contact and statgie surelng to prove th-paryepend and pli lationship ‘Signitcan Figures: A Practical Guide lo Unprecented Cos Savings in Purchased Series optimize your thss-party sence through cost redution and supper purchased services program journey, ths book guides you success within Order Your Free Copy Today ‘The Power of the GPO prongers operate on faearembusement wth fo abit shift costs to ‘ther payers oreonaumers Gen tis fealy, Prom’ group purchasing ‘rgarlzaon (GPO) s the shel doing everything possi help protect guns nfiaton ith longer a fr aes preg fo sarrats [Alonglde ou committe members and spy chan execatives Premiar’s ‘oureng teams have bee ell waking to erage he sal numberof epreemants fected by sation ae marke! condtons prove, Indio (oinlormaton proved on elialyequvaletproduta {onseraton sates and natal recovery options, ou sommes are as needed to ensue that upcoming RFPs and contracts ae executed atthe Managing more thn $82 billon ingroup purchasing vlune, Prem ‘atolater he colective purchasihg power of out member to algfican {het savings. With one of the songestprtflo nthe nut needing leodtere, pharmacy an thay purchased services contacts we help ‘ou member save on thousands of products and sees. To prove he power ofthe Promier GPO to cotolttal costs andinfiaion, ‘comtacts and offcortrect spend From of 202019 QT of 2022 Prema’ Contact poroliohas observed 815 percent inflationary neease, wrens ‘fhoorzetsperainereased by 52 percent ov! the safe peed — [Sterna of nery 3 (a measured wt Reta ols spent over the {outs of 2020 compared 012022) eee ne eed Pa ae ate a eee ee rarer res ammurcaton wth gba suppl a menor er ks wth spect focus on prosuets eal to care andeatgories with umsethy mae Mak astessmenti embedded nthe ONA of ou correcting aporoech, Irluding data on where prosct an rw materi are sored sfey stock Fequements data on ely tectds and api replenishment capabl tes Heattheste provers expect mae out ofthe GPO todey — delve ‘meaningful sokaions for seis, lngétmresllency and enabng the Premiers GPO ls delivering, Premier resiliency survey respondents ranked GPOs as the ‘most valuable source of information on product shortages. id You Know? _SURBASS* brings together Premier's most commited members 0 {coordinate purchasing decision, conalste vendors and matin ‘Standardznton across ther facies. n return, SURPASS members — and ‘hel afiates ~recrvebestinlass valve based on otal cost of cae, ‘imerhip anor sece “SURPASSY ges us the ably o access bestin class pcingn exchange for ‘lume and buying erty alongside other Promior members This cllectve ‘aang power as anslatd to immedlate resus reducing our upoly ‘upenses whe alo ensuing our ciniians ae engeged ond have acces fo thehghuaiysuppies they need ta bes! veo ou pate “SURPASS? products and services are backed by eine esearch and with ‘members thorough) veting ard ving on th parol which ely speeds {pth proces forus and engenders ust wth our cnians" Alex Hanes, Director of Materials Management, The itovve Hospital, ‘AClinically integrated Supply Chain The supply hain sno eager aniseed transactional purchasing activity helping provider celver bate ear, mprove outcomes and lowe cst. More ogenztons ae tuning to proces improvement and een suetegies {ond savings and sraltaneocst ve strong cliveal outcomes. A lineal tegrated spol cham presets a sigifeat opportu) amid {his backcrop ad with value analyst sa oor operational mindset for ‘ually, potent and sta afr reverue enhancement and rembursement “appropiate ullzation and standerézetion Implementation of cost savings and cost-avedance nites entiation and elation of wast, redundancy andineicincy. Inshort value anaes enables sancarzation and reduced supoW chan Premarand sessing heathare consulting fm, suport members ‘Spportntesforimprovemert Signieat ime ard efor are dees {oconfrming reduc effeacy and crcl outcomes ~ with te coc {tama understanding tat thelr conrbutoneubrmately hep save es. Wire alo leveraging the valve ants process to et and implement new technologies ana ensue the ight ft fr ah otgantzation ands jouey insights to help our members drwve success at every stage ofthe value shatyisjourey. ‘nea nance operational end suply chan ta ve PING AI, Pemex ‘tan eae o support health systems in achieving acliealy iterated Supply chan for efclencles, savings and oong petit outcomes provicers Supply chal, clislans,opertions snd france a hve a seat at Get a Copy of the erase Value Analysis ‘Value analysis, n a post-pandemic world has found renewed purpose, Guide Today ght tne and fe ight pice based on he oid vale care dee. a Seger sete gee come oy ‘Spotght: Supporting Providers Accross the Continuum of Cate ‘Today neatly 90 percent of heslhcare services are deveted outside he {ou wale ofthe hospital Wis great dept: andbredty hs sogment of heathcare~ the cortnaum of ete (COG) ee wil compare of he US heabare ecosystem ‘een the 000 vastness and mutitudeoftouchports along an nda ‘eatheare journey, he cesta hasange connecting the dot for Inotened eficancle rece cote and ber outomes hat beret Danis, providers and suppters ake Premiers supporting healthcare provides onthe care consnuum with { dedested purchasing program ena expert, tecnologyttven 2.90) ‘ham teol, ar nteligence (-backeesuvellance slutons andy dvocling for necessary leglative tort ‘Spotight Driving Improvement in Childrens Healthcare Chivers hospital ean be particu wulreadle to sual ain

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