please do question after reading Arnold Palmer Hospital, one of the…

Question Answered step-by-step please do question after reading Arnold Palmer Hospital, one of the… please do question after reading   Arnold Palmer Hospital, one of the nation’s top hospitals dedicated to serving women and children, is a large businesswith over 2,000 employees working in a 431-bed facility totaling 676,000 square feet in Orlando, Florida, Like manyother hospitals, and other companies, Arnold Palmer Hospital had been a long-time member of a large buying group, oneservicing 900 members. But the group did have a few limitations, For example, it might change suppliers for a particularproduct every year (based on a new lower-cost bidder) or stock only a product that was not familiar to the physicians atArnold Palmer Hospital. The buying group was also not able to negotiate contracts with local manufacturers to securethe best pricing.So in 2003, Arnold Palmer Hospital, together with seven other partner hospitals in central Florida, formed its own muchsmaller, but still powerful (with $200 million in annual purchases) Healthcare Purchasing Alliance (HPA) corporation. Thenew alliance saved the HPA members $7 million in its first year from two main changes. First, it was structured andstaffed to assure that the bulk of the savings associated with its contracting efforts went to its eight members. Second, itstruck even better deals with vendors by guaranteeing a committed volume and signing not 1-year deals but 3-5 yearcontracts. “Even with a new internal cost of $400,000 to run HPA, the savings and ability to contract for what ourmember hospitals really want makes the deal a winner” says George DeLong, head of HPA.Effective supply-chain management in manufacturing often focuses on development of new product innovations andefficiency through buyer-vendor collaboration. However, the approach in a service industry has a slightly differentemphasis. At Arnold Palmer Hospital, supply-chain opportunities often manifest themselves through the MedicalEconomic Outcomes Committee. This committee (and its subcommittees) consists of users (including the medical andnursing staff) who evaluate purchase options with a goal of better medicine while achieving economic targets. Forinstance, the heart pacemaker negotiation by the cardiology subcommittee allowed for the standardization to twomanufacturers, with annual savings of $2 million for just this one product.Arnold Palmer Hospital is also able to develop custom products that require collaboration down to the third tier of thesupply chain. This is the case with custom packs that are used in the operating room. The custom packs are delivered by adistributor, McKesson General Medical, but assembled by a pack companythat uses materials the hospital wanted purchased from specific manufacturers. The HPA allows Arnold Palmer Hospitalto be creative in this way. With major cost savings, standardization, blanket purchaseorders, long-term contracts, and more control of product development, the benefits to the hospital are substantial.Discussion Questions1.How does this supply chain differ from that in a manufacturing firm?2. What are the constraints on making decisions based on economics alone at Arnold Palmer Hospital?3. What role do doctors and nurses play in supply-chain decisions in a hospital? How is this participation handled atArnold Palmer Hospital?4. Doctor Smith just returned from the Annual Physician’s Orthopedic Conference, where she saw a new hip jointreplacement demonstrated. She decides she wants to start using the replacement joint at Arnold Palmer Hospital. Whatprocess will Dr. Smith have to go through at the hospital to introduce this new product into the supply chain for futuresurgical use?Image transcription textArnold Palmer Hospital, one of the nation’s top hospitals dedicated to serving women and children, is a largebusiness with over 2,000 employees working in a 431-bed facility totaling 676,000 square feet in Orlando,Florida. Like many other hospitals, and other companies, Arnold Palmer Hospital had been a long-… Show more… Show more  Business Share QuestionEmailCopy link Comments (0)