The era of health system supply chain maturity is upon us.
Last week, Gartner published the Healthcare Supply Chain Top 25 ranking for 2022. What struck us this year, is that the healthcare supply chains are getting more mature. We’ve always thought some health systems in the Masters Group and the Top 25 had advanced maturity compared to any industry. But what is amazing to see is the rapid advancement of many health systems that had ranks just outside the top 25 and even those in the middle. Our industry is doing so much, and we hope it is setting up the golden age of healthcare supply chain. In this blog, we will share some insights on the health systems ranked 26 to 40 – the next 15.
These health systems, ranked No. 26 to No. 40, have strong supply chains. Amazing supply chains, in many cases. Others are on transformation journeys. Some are long-time, foundationally great supply chains who are less inclined to share across the industry. And some have solid supply chains that are strong financially and/or differentiate with exemplary quality-of-care scores. Every health system on this list and in the top 25 has challenges – areas that they are stronger or weaker in. The key for health systems is to keep seeking constant improvement and alignment to value. Over time, and with some industry leadership (a core component of the peer and analyst vote – the doing of great things and the willingness to share them), the Top 25 can be within reach. Some of these health systems are national in scope and some are smaller regionals who run tight operations with depth.
One of the key goals of the HCT25 is to share lessons from leaders. Each of these health systems has lessons to share. Tremendous progress in clinical alignment, ESG focus, risk and resiliency efforts and improving governance over supply chain are hallmarks of the many systems in this group. Many have sustained leadership in supply chain over many years and some are transforming with bold direction and senior management support to drive change. We look for wonderful things from this group and advocate putting them on your watch list for excellence.
This year we had 129 health systems to be considered. Each must have more than $2 billion in operating expense and be recognized as a health system in Merative’s 15 Top Health System Study.
Gartner’s opinion makes up less than 30% of the ranking, with other qualitative metrics being peer opinion (30% of the ranking) and quantitative. That last category breaks down as 20% Merative 15 Top Health Systems performance as a proxy for quality of patient care, 15% bond rating as a proxy for financial discipline with 5% added this year to ascending levels of engagement with the nonprofit Healthcare Anchor Network as a proxy for ESG commitment.
Gartner strives to listen to feedback from leaders on publicly available and auditable metrics and the associated correct weightings and made changes each of the past two years. We are also committed to evolving the ranking even more in the future. For the health systems ranked in the top 25, we share the detailed scoring in each category and we share the specific details of any health system’s performance overall and by the five areas. (See figure shown above.)
On this list of No. 26 through No. 40, six have made our ranking sometime in the past (Johns Hopkins, BayCare, HonorHealth, Parkview, THR and HCA). Getting onto this Next 15 list in 2022 took different paths as indicated in the figure below. Each system had to be consistent in most of the components of the ranking but not all. Health Systems within this group fell short in some areas while excelling in others but their score added up to put them close to the Top 25.
In fact, really close. Inside the numbers of the Healthcare Supply Chain Top 25, we see a tight range in the scoring from No. 26 through No. 40 – on a 10-point scoring scale these health systems are in a tight range from 4.15 to 3.46. Movement up or down in any category can easily mean change of 5 to 10 spots in this part of the ranking.
All this just shows that the ranking is made up of these five components and that excellence can be shown in many ways. Some peer voters look to our previous year’s Healthcare Supply Chain Top 25 to identify who is doing great stuff. We have two invitations. One is to health systems in this group (and lower in the ranking) to do tremendous things in supply chain and share them. And, second, to our peer voters to seek out the remarkable things that other health systems on this list and beyond are doing and help recognize them.
Gartner Supply Chain
The Healthcare Supply Chain Top 25 for 2022 is accessible to Gartner clients.
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