A way for reducing drug supply chain cost for a hospital district: A case study
Abstract: This work aims at
providing insights to optimise healthcare logistic of the drug management, in
order to deal with the healthcare expenditure cut. In this paper the effects of
different drug supply chain configurations, on the resulting average stock,
service level and Bullwhip effect, of the studied supply chain, is
quantitatively assessed.
Design/methodology/approach: A case study of an Italian district has been
studied, taking into account three echelons: suppliers, central stock, and
hospitals. A model of the various supply chain configurations has been created
with the use of the simulation. Specifically, 24 supply chain configurations
have been examined, stemming from the combination of several supply chain
design parameters, namely: transshipment policies (Emergency Lateral
Transshipment or Total Inventory Equalization); re-order and inventory
management policies (Economic Order Quantity or Economic Order Interval);
required service levels (90% or 95%); the number of available vans (one or
two). For each configuration, hospital average stock, service level and a
“Bullwhip effect” analysis are computed. To know which input variables are
statistically significant, a DoE (Design of Experiments) analysis has been
executed.
Findings: The output of this paper provides useful insights and
suggestions to optimize the healthcare logistic and drug supply chain.
According to the developed DoE analysis, it can be stated that the introduction
of transshipment policies provides important improvement in terms of service
and stock levels. To reduce the Bullwhip effect, which results in a service
level decreasing, and in a managing stock costs increasing, it is worth to
adopt an EOQ re-order policy.
Practical implications: This research gives practical recommendations to
the studied system, in order to reduce costs and maintain a very satisfactory
service level.
Originality/value: This paper fulfils an identified need to study which
combination of transshipment policies, re-order/inventory management policies
and required service levels, can be the best one to reduce costs and maintain a
very satisfactory service level, in the specific logistic system.
Keywords: healthcare logistic,
drug management, supply chain design, discrete-events simulation model, design
of experiments
Author: Leonardo Postacchini,
Filippo Emanuele Ciarapica, Maurizio Bevilacqua, Giovanni Mazzuto, Claudia
Paciarotti
Journal Code: jptindustrigg160007