For more than 100 years, Medline has delivered essential medical supplies to healthcare providers, from exam gloves and surgical gowns to environmental services products. And like others in the industry, Medline was tested in the early months of the COVID-19 pandemic as global supply chain shortages and bottlenecks transformed business operations.
Andy Mills, president of Medline, says the company not only weathered the storm, but even strengthened relationships with provider partners. Medline’s core principles — transparency, honesty and sharing in financial risk with customers — have served the company well during the pandemic. Now, as the industry comes out of COVID’s fog and faces other immense pressures, including severe workforce shortages, tight profit margins and still, supply chain concerns, Medline continues to walk alongside their provider partners, helping them address their most pressing issues and prepare for the future.
During a conversation with Andy Mills at Medline’s sprawling headquarters in Northfield, Illinois, he shared how Medline is working with providers to achieve strategic priorities, including access and affordability, as well as emerging opportunities for care delivery innovation such as home care and digital tools. He also discussed the biggest lessons the industry learned from COVID and his vision for healthcare delivery going forward.
Access, affordability, and quality came up as major strategic priorities for the executives who were brought together by Medline at Modern Healthcare’s recent Leadership Symposium. How can Medline help healthcare organizations achieve these strategic goals?
Care delivery models are expanding in complexity, and many healthcare systems are taking on greater ownership and responsibility for a wider range of care settings. We have had more and more systems come to us looking for a holistic solution that supports their entire network. Not just the ability to serve all of their points of care, but to optimize quality and affordability across an increasingly complex care network.
We recently launched our Omni-Serve program to pull together all of Medline’s capabilities to best serve health systems in light of the expanding points of care they have to manage. That begins with access to any care setting, with consistent products and services no matter where the patient is within their care journey. Omni- Serve enables health systems to operate consistently across their entire footprint, whether that includes hospitals, ambulatory surgery centers, physician offices, assisted living, nursing homes, care delivery into the home, or any combination of those settings.
This program offers a menu of innovative capabilities that align with health system priorities to continuously improve quality, to make healthcare easier for the patient, and support strained clinical staff. It enables consistency of products and provides pricing parity into any channel, yet enables supply chain execution that is tailored to the unique needs of varying care settings, including direct to patients in the home. Standardization of products and clinical offerings reduce variability, which can improve outcomes.
By leveraging products, supply chain operations and clinical programs that enable the same performance and service expectations regardless of care setting, we can drive down costs while simultaneously improving quality. Medline’s history has been built around delivering value through high quality products and services, while driving down costs at the same time. We see it as our responsibility to help healthcare providers deliver the best care in the most financially sustainable way. I’m excited about our ability to provide what health systems need to enable their entire network of care.
What role does Medline play in working with healthcare organizations to expand the transition to more care provided at home?
We realize that shifts in where care is delivered will continue going forward. It’s the future of healthcare, partially because economics and the cost of capacity require that care be focused on the lowest cost care setting. Moving more aggressively to home care is still in the early stages, and many healthcare systems are in the midst of figuring out what that model looks like and how they will execute it.
Medline is involved in this process because of our understanding of the home care model. We’re the largest med-surg supplier in the home care space, which is helping us marry those logistical requirements with the needs of the acute care model. Looking at requirements like two-hour delivery and triaging pharmacy, x-ray, infusion and durable medical equipment (DME) are exciting challenges that will help progress how and where care is delivered.
Hospital-at-home in the right markets will provide the additional beds needed in a setting that most patients would prefer.
We are actively expanding our partnerships and services to meet the needs of these new models. We’ve continued to invest in supply chain infrastructure, and we’ve expanded our delivery fleet to support parcel trucks for home delivery. But we’re also advancing technology as we consider other needs in this area, like improvements to enable more comprehensive discharge management.
COVID-19 exposed the flaws of the fee-for-service model. How does Medline encourage the transition to value-based care?
We’ve been working to deliver the best economic value for our customers for as long as I can remember, but our business model continues to evolve in how we support value-based care. Certainly, the growing breadth of our clinical programs that are designed to minimize infection, prevent the breakdown of skin, or prevent fall risks are all examples of that.
Medline has taken a serious approach to risk share, where both the provider and Medline sit at the same side of the table and collaborate, share skills, and make decisions to get the best possible outcome. This is a true change to traditional relationships, moving us from a supplier to an integrated partner. Risk share agreements that align objectives around provider and supplier ownership of results is one of our most exciting progressions as it truly does align everyone to deliver the best possible outcomes.
How we structure our partnerships with healthcare systems can be a valuable tool for them as well. The traditional product-for-a-price agreement can move to a risk-share agreement. Risk share programs can further evolve to other alternative structures, like goods provided on a flat cost, per patient, per day basis.
One benefit of COVID was the innovation we saw. There are concerns that innovation is now dissipating. Where does the industry still have opportunities to innovate?
There certainly was a lot of rapid innovation during COVID. By necessity, it was sought out and adopted more quickly, but I don’t think it’s dissipating. If anything, COVID highlighted the need for continued innovation and showed the industry that we can make things happen quickly with the right focus.
Given the staffing challenges that most healthcare providers are experiencing today, I believe there are huge opportunities in innovation to drive efficiency, not just with products, but also in process innovation. There are ways to enhance the efficiency of clinicians’ jobs, minimize the amount of time spent on non-clinical activity and make their jobs easier. We have already seen some tremendous successes in the ability to take time out of many clinical activities through innovative bundling and kitting, as well as with organization and stocking strategies.
Like we saw during COVID, innovation can be rapid with the right alignment. One key factor is that reimbursement models must align with, and support, the areas of need and incentivize innovation that can deliver improvements.
Digital is going to be a big part of the future of healthcare. How is Medline adopting digital tools and solutions in their partnerships with healthcare organizations?
Today, we’re seeing digital tools play a role in many of our partnerships with healthcare providers. For example, Medline has a program that improves the surgical experience by connecting pre-surgical preparation kits directly into the EMR. This utilizes digital tools to automate direct shipments to patients with needed products and information and provides automatic digital communication with clearer instructions through texts and video. We’re also investing in more advanced technology to help better coordinate discharge management. These are innovations that help further engage patients in their care, require no intervention from the clinician and provide better patient loyalty.
We’re going to continue to aggressively apply technology to innovation and efficiency improvements that can enable improved outcomes. For us, those are often developed through external partners, or in conjunction with our healthcare partners as we develop new solutions together.
In your opinion, what was Medline’s biggest lesson from the pandemic?
The value of transparency was a learning experience for Medline a long time ago. Way back in the ‘90s, we had a company-wide conversion to a new computer system that didn’t go well. When it started up, the system crashed. We told our employees the scope of the issue, and that to get orders out to our customers, everyone was going to have to work on weekends until it was fixed. And the results weren’t what I expected — I don’t think morale was ever higher. Everyone got engaged in helping to solve the problem. That taught me if you’re open and transparent with people, you create engagement. And we never looked back after that. That was 26 years ago.
Without question, over the last two years, we have seen the value of consistently open, transparent communication. It was especially important to healthcare providers during a time of such uncertainty. The regular discussions about availability of supplies reinforced the importance of always being as open and transparent as possible. At a time of industry-wide shortages, being honest about our situation — what we could do and what we couldn’t — was critical to enabling healthcare providers to make informed decisions. We could have tried to avoid difficult conversations and only share an optimistic outlook, but that approach would have been a detrimental one for everyone over the long-term.
Beyond that, we saw the value of agility and diversification. These have long been a part of Medline’s approach, but our ability to change course rapidly and have the infrastructure and relationships to do so was critical to supporting our healthcare customers as effectively as possible. Examples like starting up U.S. manufacturing of face masks in only four weeks, or being able to use our global footprint to identify and develop alternative products, meant we could serve our customers better.
What’s your vision for the future of the industry?
We’re going to continue to see a changing model of where care is delivered, with greater coordination required among all participants across healthcare. As a part of that, hospital relationships with partners in other care settings, and relationships between providers and their suppliers, are going to have to be more collaborative in the future. Different groups are going to have to work more closely together.
Click here for the recap of Medline's roundtable discussion with C-suite executives at Modern Healthcare's 2022 Leadership Symposium.
