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What Do Major Hospital Centers and Retail Distribution Centers Have in Common?

When you think of a traditional retail distribution center, the image is vivid: a warehouse stocked with inventory for a brief period before it’s sent out to retailers, wholesalers, or consumers. Products include everything from clothing and furniture to consumer electronics.

Close your eyes and imagine a major hospital system operating like a retail distribution network. It’s not a daydream; it’s a reality for healthcare providers with a robust final mile logistics strategy. Pharmaceuticals, surgical supplies, lab specimens – everything necessary for hospitals to deliver top-tier care – all flow and move within a final mile delivery network. The list of items needing to be distributed between medical facilities goes on seemingly forever: masks, patient gowns, specialty medical devices, heart rate monitors, blood pressure cuffs, sterilized equipment, janitorial supplies, and more. The final destination for these products may be a hospital, outpatient center, pharmacy, or an individual patient’s home within the health network’s ecosystem.

While hospital systems and retailers don’t have much in common regarding getting items where they need to be and when they need to be there, their final mile logistics are remarkably similar. Let’s draw parallels between two of the largest industry sectors in the United States to see how the same efficient logistics processes that move apparel, automotive parts, and packaged goods can also apply to life-saving medication, equipment, and daily supplies that arrive on time and, above all, safely.

A Smart Approach to Logistics in Healthcare

It’s no secret that the healthcare industry has changed in recent years, with cost pressures and compliance changes permeating every corner of the industry—especially logistics. Amid a global pandemic, labor shortages, and rising costs, healthcare systems have been eager to find new opportunities to cut costs and streamline their operations without sacrificing quality of care.

In many cases, inefficiencies in the logistics network cost health systems millions annually. To save on costs, many hospitals have been shifting away from the supply distributor model and moving towards a diversified distribution approach with a final-mile delivery partner.

A Three-Pronged, Integrated Final Mile Logistics Model 

Like retail, the optimal last-mile solution is an integrated distribution strategy powered by a robust network of scheduled and on-call deliveries.

1. Central distribution from a non-clinical location

The greatest number of similarities between retail and medical final mile logistics is in this tried-and-true model. More and more medical groups and hospital systems invest in regional non-clinical cross-dock distribution facilities. Imagine everything required to ensure a hospital runs smoothly and safely, all stored in one place off-site. As mentioned, this extends beyond medication to many other products, including masks and cleaning supplies, technology like iPads for care providers, monitors for administrative staff, and everything in between.

In the central distribution model, bulk shipments from suppliers and current inventory not in use are kept in one regional location. Accommodating this high product volume calls for spacious facilities; the average healthcare distribution center is now more than 170,000 square feet.

From this hub, a final-mile delivery partner ensures that products are safely delivered to the right location according to regulatory requirements.

2. Facility to facility 

For large health systems that consist of multiple sites—hospitals, out-patient centers, doctors’ offices, etc.—there’s a need to transport medicine and equipment from one facility to another. Like retail distribution, inventory may need to be redistributed if one facility has excess inventory of an item in demand at another location. For example, a hospital may have excess hospital gowns or masks that could be immediately used at a nearby outpatient operating site. Skip the centralized distribution center and simply move items between facilities.

Other use cases for this model include sterilized equipment and blood samples. Due to the high cost and specialization of sterilization processes, satellite offices often send equipment to a nearby centralized location to be sterilized and then redistributed back to those same offices and many others as needed. Similarly, blood samples taken at an off-site facility may be sent to labs inside the nearby hospital. In contrast, medicine needed for chemotherapy treatment may be sent from a hospital pharmacy to a more patient-convenient satellite location.

3. Facility to patient

With the growing trend of bringing healthcare directly into patients’ homes, many health systems have designed at-home treatment programs, including home delivery of medication and equipment. Final mile delivery partners enable same-day and next-day Rx home deliveries and transport small devices like blood pressure machines, oximeters, and medical IV poles directly to patients’ homes. The facility-to-patient model also encompasses deliveries to long-term care (LTC) facilities, senior communities, and contract providers such as home infusion professionals. Multiple essays could be written daily on the current state of at-home healthcare delivery and its potential in the future. But for now, we’ll leave the subject alone and simply illuminate final mile delivery logistics as the key to these programs’ successful implementation.

The Holistic Benefits of a Final / Last Mile Partner

Creating a resilient last-mile logistics network – utilizing all three approaches mentioned above – requires experience, expertise, and an understanding of compliance. With USPack, you can rely on:

1. An impressive track record with world-class hospital systems

After more than three decades working in the healthcare sector, USPack has accumulated an impressive client list that includes two of the largest hospital systems in the Metro-North area, one of the most prestigious research hospitals in the country, and many more notable multi-location healthcare networks. While working with these distinguished medical institutions, USPack’s last-mile services have matured over many years to mirror the standards and expectations of the healthcare services professionals provide in each hospital and clinic location.

2. A HIPAA and OSHA-compliant fleet 

Supporting the needs of the healthcare community and their patients is a responsibility that we take very seriously. We bring an in-depth understanding of the industry and strict HIPAA and OSHA standards compliance. USPack drivers are trained to understand regulations, mitigate potentially hazardous situations, and are updated as regulations evolve. For example, in the case of radiopharmaceuticals, drivers may be required to receive special badges to demonstrate they were not exposed to dangerous activity (film badge dosimeter). In special cases, USPack supplies a logistics manager on-site to manage the last mile network and coordinate directly with hospital staff.

3. A mature driver recruitment process and 30+ years of experience

USPack has been in the final-mile medical transportation business for over 30 years. Our network of over 6,000 experienced drivers is supported by a mature driver recruitment and onboarding process that ensures all drivers adhere to our and our clients’ rigorous standards for safety, excellence, and professionalism.

The stakes are high regarding logistics in a highly regulated, expensive, and life-saving sector. Trust a final mile provider proven to deliver value—for 30 years and counting. Contact USPack to learn why top healthcare systems nationwide trust us most regarding final mile logistics.

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