Spine and orthopedic leaders discuss their strategies amid the policy landscape.
The 17 leaders featured in this article are speaking at Becker’s 22nd Annual Spine, Orthopedic and Pain Management-Driven ASC + The Future of Spine Conference, set for June 18 to 21 at the Swissotel Chicago.
If you would like to join the event as a speaker, please contact Carly Behm at cbehm@beckershealthcare.com.
As part of an ongoing series, Becker’s is connecting with healthcare leaders who will speak at the event to get their insight on thought-provoking questions within the industry. The following are answers from event speakers, lightly edited for clarity.
Question: How are you strategizing amid changes and uncertainties with the medical supply chain and tariffs?
Michael Boblitz. CEO at Athens (Ga.) Orthopedic Clinic: Unlike other industries, physician groups are in a challenging environment where Medicare pays less and private payers — historically — pay the same. As a result, expense management is mission critical.
Private orthopedic practices, similar to many health care organizations, have the vast majority of operating costs with labor and supplies. While labor management is a constant focus, the healthcare field remains a “high touch” industry that cannot be easily scaled or replaced with technologies and other efforts.
My new tenure as CEO with Athens Orthopedic Clinic is bringing a laser focus on supply chain via best in class inventory management, financial controls and price control.
We are moving our durable medical equipment onto a new automated platform to significantly reduce shelf life, and eliminate what has historically been a very manual and time consuming effort to track inventory.
At the same time we are challenging our current DME vendors to reduce costs per unit by 20% plus while also offering the same cost reduction goals to competing DME vendors. In other words, AOC is open for business with any and all that offer the best pricing.
Looking beyond the practice, AOC operates a strong multisite ASC division. Our ASCs already perform a large number of joint replacement cases each year that include high cost implants. Soon we will open a new ASC that focuses only on spine and joint replacement surgery, so we can backfill the existing centers with additional lower acuity orthopedic cases that currently cannot be accommodated due to capacity constraints.
AOC is working quickly to partner with a leading Group Purchasing Organization that will offer significant savings on high cost implants within our ASCs as well as all supplies that are required to operate our growing practice.
Overall, Athens Orthopedic Clinic has a top priority to drive down supply costs — fast — and will continue to do so regardless of how tariffs play out.
Ernest Braxton, MD. Vail (Colo.) Summit Orthopaedics and Neurosurgery: As spine surgeons in private practice, we are considering domestic options when feasible, and maintain a strategic stock of essential implants and trays. The hospital is leveraging GPOs like Vizient to negotiate bulk pricing to manage expenses.
Paul Bruning, DHA. Neuromusculoskeletal Service Line Director of Sutter Health’s Silicon Valley Division (Sacramento, Calif.): The question of tariffs continues to change daily. As other countries respond with various other tariffs, this issue will become more pressing and unfortunately provide more clarity around the expense and influence on the supply chain. It is very hard to predict what is going to happen. However, consideration of various key supply chain sources of materials is based on the country providing the supplies.
Harel Deutsch, MD. Rush University Medical Center (Chicago): I do not believe tariffs are a big issue for medical supplies and devices. Most devices, implants, and supplies are currently manufactured in the USA and other supplies overall make up a small portion of the overall healthcare cost. While I believe many generic pharma products are made overseas, the actual cost to consumers probably will not be significantly affected by increased import costs.
Kate Gillespie, BSN, RN. Vice President of MSK and Neuroscience, Virtua Health (Marlton, N.J.): It is too early to tell the full impact given how the countries are coming to the table to mitigate the initial announcements by the administration. We are already seeing wealthy countries investing in domestic production of supplies.
2025 supply chains estimate an 8% to 9% gross increases on supplies and devices, a 7% for pharmaceuticals.
Our GPO contracts are protecting us likely through the end of 2025. The very strict compliance of members enables price locks and discourages vendors to pass increases specially based on speculation. Based on our participation in industry and GPO councils, this will keep us in the know over the coming months on where this will land.
Beyond 2025 is where the threat of increases will be material if the high double-digit tariffs occur. Currently we are reviewing our non-GPO contracts, which is where we have the most potential exposure in 2025.
Kimberley Haynes-Henson, MD. Associate professor for anesthesiology, pain management and addiction medicine; associate program director for the pain medicine fellowship; and medical director for the pain management program at University of Nebraska Medical Center: Unfortunately, this is not new territory for medical providers. COVID-19 supply issues were plentiful and our memories still fresh. Similar to the response our institution has taken in the past, we will likely try to replace any unavailable supplies with similar products from other vendors. When it comes to drug shortages, we substituted strength differences when available and appropriate for other drugs in the same class. This actually improved care, as we now always use bupivacaine 0.75% instead of 0.5% for radiofrequency ablations, as we had such good patient feedback from the change. We did have some shortages that did impact care, such as a short-term decrease in epidurals done in pain clinics to preserve kits for the operating rooms. I imagine if that type of severe shortage recurs, we will need to prioritize patient care at that time.
Alexandra Hogue. Director of Operations at Orbis Surgery Center (Houston): Our organization will work with our supply chain aggregator to help source vendors and options for our facility as we approach changes in the medical supply chain market. If there looks to be disruptions in the production of items that are not accessible from other vendors we will work to create a system of ordering these items at a rate that we create buffer stock, similar to how we handled the most recent shortage of IV fluids following the effects of Hurricane Helene.
Michael C. Lewis, MD. Joseph L. Ponka Chair of Anesthesiology, Pain Management and Perioperative Medicine Department at Henry Ford Health System (Detroit), Professor and Chair at Michigan State University College of Human Medicine (East Lansing) and Anesthesiology Professor at Wayne State University (Detroit): Our approach prioritizes proactive supply chain management, strategic partnerships, and data-driven forecasting. We cultivate strong relationships with suppliers to enhance resilience, diversify sourcing, and maintain flexibility in procurement strategies. By leveraging advanced analytics, we detect potential disruptions early and adjust inventory levels accordingly. Collaborating closely with clinical and operational teams, we optimize resource utilization, mitigate cost impacts, and ensure seamless, uninterrupted patient care.
Brett Maxfield. Director of Anesthesia and Surgical Services at Teton Valley Health Care (Driggs, Idaho): With the uncertainty in the supply chain, we have made a conscious decision to increase the amount of stock we have in rotation. The pandemic taught us that while our streamlined purchasing managed to keep our costs low and our expiring product minimized, it also resulted in difficulty acquiring product during the shortage. We took the lessons learned from the pandemic and applied them to our future outlook to make sure we have sufficient supply to last for approximately three to four months in house at all times.
Chhaya Patel, MD. Satellite Boulevard Surgery Center (Duluth, Ga.): 1. Supplier Diversification & Contract Negotiation
- Establish multiple vendor relationships to avoid reliance on a single supplier.
- Negotiate bulk purchase agreements with manufacturers and group purchasing organizations (GPOs) to secure stable pricing.
- Explore direct relationships with manufacturers to bypass unnecessary markups from intermediaries.
2. Inventory Management & Demand Forecasting
- Implement an AI-driven or just-in-time (JIT) inventory system to optimize stock levels while minimizing waste.
- Increase par levels of critical supplies prone to disruption while maintaining cost efficiency.
- Utilize predictive analytics to anticipate potential shortages and price hikes.
3. Cost Containment & Standardization
- Standardize products and brands across all ASCs to benefit from volume discounts.
- Limit vendor variability in surgical implants, instruments, and disposables to streamline procurement.
- Train surgical teams on cost-effective product alternatives without compromising quality.
John Prunskis, MD. Medical Director and Principal at DxTx Pain & Spine (Chicago): I plan on addressing these concerns with the people in Washington DC in the Make America Healthy Again Movement to make sure they understand that any tariffs or supply chain disruption do not inhibit patient access to high-quality care.
Bethwel Raore, MD. Apex Spine & Neurosurgery (Bethlehem, Ga.): Our strategy amidst supply chain and tariff uncertainties centers on maintaining consistent value for our patients. This focus allows us to adapt to market changes while prioritizing patient care. We are also diligently managing our current supplies and closely monitoring the impact of tariffs, ensuring we can respond swiftly to any shifts and uphold our commitment to patient care.
Melissa Rice. Administrator at Loyola Ambulatory Surgery Center (Oak Brook Terrace, Ill.): We are proactively monitoring supply chain trends and tariff impacts to ensure continuity and cost-effectiveness for our centers. By strengthening supplier relationships, diversifying sourcing strategies, and leveraging data-driven procurement decisions, we mitigate risks while maintaining quality patient care. Additionally, we continuously evaluate cost-saving opportunities and operational efficiencies to adapt to market fluctuations effectively.
Allison Roditi, Vice president of orthopedic services at Catholic Health (New York City): In light of potential tariffs and uncertainties with medical supply chains, it is imperative to anticipate the most critical needs for your service or service line. Understanding your timelines, particularly for high-level specialty equipment, will be crucial for planning and budgetary considerations. Formulating a highly specific ROI will be pivotal to ensure that any additional costs associated with especially large specialty equipment can be factored in. While locally manufactured products may be a preferred option, we acknowledge that their prices will likely increase. Therefore, it is essential to prioritize cost-effective, high-quality products and collaborate with suppliers to achieve optimal pricing.
Amanda Ryan, DO. Advanced Heart and Vascular Center of New Mexico (Carlsbad): We are strategizing by doing proactive risk assessments that include identifying potential disruptions, developing contingency plans, staying informed, and learning to utilize data analytics to improve supply chain forecasting. Supplier diversification is also key to success including exploring alternative sourcing and supplies and reducing dependence on a single supplier or region.
Nikhil Shetty, MD. COO at Midwest Interventional Spine Specialists (Munster, Ind.): Managing uncertainties in medical supply chains requires a mix of strategic sourcing, planning, and operational flexibility.
A. Diversifying our suppliers by establishing relationships with multiple providers and avoiding dependency on a single source. Additionally, bulk purchasing orders typically allow for negotiating better terms. This strategy also carries over into logistics. Working with multiple shipping partners to limit delays/cancellations.
B. Long-term pricing contracts act as a hedge against price fluctuations. Open communication with insurers and patients allows pass-through pricing strategies to account for inflation/fees.
C. Digital tools and AI can optimize inventory and scheduling which frees up our staff to attend to clinical patient care needs. This also helps with uncertainties in medical staffing.
Jeremy Stogner, RN MSN. Administrator at Central Arkansas Surgery Center (Little Rock): We have identified a list of “must have” and “frequently used” items. Items on these lists have increased par numbers and we will proactively order extra when there are indications of possible disruptions to the supply chain. Also, we have verbal agreements with surrounding ASCs that allow us to borrow small quantities of items and resupply their stock when our supply shipment has arrived. Being proactive and working together within our community has allowed very few disruptions during this time.