In this quarter’s newsletter we’ll touch on Premier’s Spring 2023 Economic Outlook, take a look at regional inflation, freight rate and trucking updates, as well as U.S. diesel fuel prices by region, and regional warehouse pricing trends. We are also announcing a virtual Supply Chain Forum we’re hosting on April 26. We dive deeper into a new strategic relationship with SpendMend who has a complete suite of cost-cycle solutions that has delivered over $2B in bottom-line savings and recoveries to its clients. And finally it’s that time of year to talk about Premier’s Breakthroughs Conference, this year we’ll be traveling to Nashville, TN. Read more here…
Premier’s Spring 2023 Economic Outlook
As we enter Spring, we’re encouraged to see a slow, yet positive supply chain recovery. In Premier’s Spring 2023 Economic Outlook publication, its noted that the 2021-2022 global supply chain disruptions with empty shelves, longer lead times and higher prices proved challenging to every sector of the U.S. economy, including healthcare. There is good news of global transportation and freight indexes showing downward trends heading towards pre-COVID-19 rates, and a stabilized demand for supplies and ample inventory. However, the supply chain worldwide remains fragile with ongoing disruptions, workforce challenges and elevated inventory levels. All of these need to be addressed to support a recovery to “normal” pricing.
UISS/Premier vows to continue to implement innovative solutions to address resiliency, product availability and cost reduction through greater diversity of manufacturing and suppliers, actionable data and technology enablement, and leading advocacy efforts.
Below is a snap shot of regional supply chain metrics for the Northeast which shows a positive downward trend and the link to Premier’s 2023 Spring Economic Outlook of national data The 2023 Spring Edition of Premier’s Economic Outlook.
Regional Inflation:
Source: U.S. BLS
- 12-month percentage change (Jan 2023), CPI for the Northeast was lower than the South and West regions in the U.S. It was equal to the Midwest Region.
- When reviewing peak CPI from 2021-Present, the Northeast Region reported more favorable CPI / inflation rates.
February 2023 Freight Rate and Trucking Updates:
Source: TCI Business Capital
- U.S. Freight Rates for Vans, Reefers, and Flatbeds were the lower in the West region and highest in the Midwest.
- The Northeast was under the national average by $0.09 for van rates.
- The Northeast was under the national average by $0.10 for reefer rates.
- The Northeast was over the national average by $0.07 for flatbed rates.
U.S. Diesel Fuel Prices by Region:
Source: TCI Business Capital and the U.S. Energy Information Administration
- Diesel Fuel for the New England region is currently $0.46 higher than the U.S. National Average.
- The New England region has had the least amount of price change when compared to a year ago.
Regional Warehouse Pricing Trends:
Source: Warehousequote
- National warehouse storage rates remain elevated but unchanged (-/+%) in Q4’22 versus Q3’22 at an index reading of 109.
- At a regional level, the 3-quarter rolling average shows Northeast with the highest percentage increase at 12 percent relative to the baseline of Q1′ 2022.
- The Midwest and West Coast regions also saw increases of 8 and 7 percent, respectively.
Resources:
CPI Comparison by Region – includes Northeast, New England, and Middle Atlantic
CPI Northeast
EIA Gasoline and Diesel Fuel Update
TCI Business Capital
Warehousequote
April 26 Supply Chain Forum
UISS will be hosting a Supply Chain Forum on Wednesday, April 26th that is open to all IHA Supply Chain Executives where our speaker will be providing deeper insight into the global supply chain environment and discussing macro trends related to sourcing and operational logistics.
Additionally, IHA will be providing Supply Chain Executives with a summary of the state budget and implications for upstate healthcare financial impact
We hope you will join us for this informative webinar. Click here to learn more and register.
Purchased Services Management – SpendMend
As reported in the Winter newsletter, UISS has remained focused on helping its members with managing purchased services expenses which represent approximately 16% of a hospital/health system’s total operating expense. To that end, in addition to partnering with Conductiv, a comprehensive purchased services GPO, in February, UISS announced a strategic relationship with SpendMend.
SpendMend’s complete suite of cost-cycle solutions has delivered over $2B in bottom-line savings and recoveries to its clients. Cost cycle improvement consists of a comprehensive analysis of all non-labor spending to identify areas where healthcare systems can optimize costs across their entire ecosystem. With this approach, SpendMend has helped hospitals and health systems create cost-saving strategies that yield measurable results.
Currently, four UISS members have already contracted and begun work with SpendMend, and several more are expected to start shortly. The initial scopes of work have focused on reviewing and reconciling IT spend; equipment services and maintenance; software and maintenance. Based on strategy sessions with the contracted members, SpendMend will be expanding beyond this IT focus to help the members with other areas of purchased services spend such as record storage, reference lab, clinical outsourcing, etc.
UISS recognizes the unprecedented challenges faced by hospitals and healthcare systems due to the supply chain disruptions, inflation, and the lingering impact of the COVID-19 pandemic. These issues have significantly impacted the financial stability of healthcare organizations, and many have struggled to maintain their operations while continuing to deliver high-quality care to their patients. As a total cost management solution for supplies and purchased services, UISS is committed to helping its members navigate these challenges and achieve their operational and financial goals.
The partnership with SpendMend is one of several offerings towards achieving this goal. By leveraging SpendMend’s expertise and comprehensive suite of cost-cycle solutions, UISS can help its members identify areas where they can optimize their operations and reduce costs without compromising on the quality of care. UISS is excited to see the positive impact of this partnership and is dedicated to providing its members with the best possible solutions to help them succeed in these challenging times.
Premier’s Annual Breakthroughs Conference
Lastly, UISS is pleased once again to offer sponsorship to its UISS-Premier GPO members to attend Premier’s Annual Breakthroughs Conference in June 2023. The conference is a wonderful educational event and opportunity to network with peers across the country for shared learnings and best practices.