Navigating pros, cons of weaving through enduring supply chain crises, disruptions.
By R. Dana Barlow
Editor’s note: The following story originally appeared in the October 2025 issue of The Journal of Healthcare Contracting, a sister publication of Repertoire Magazine.
More than 100 years ago, the United States experienced the Roaring ’20s, a decade of cultural decadence, growth and prosperity that came to a crashing halt and ushered in a sequel decade of austerity, despair and economic turmoil.
A century later, cultural observers, historians and pundits likely envisioned the Soaring ’20s, but those expectations were dashed, if not twisted, as a few global and national crises and disasters so far mid-decade may motivate the more sobering sobriquet the Shoring and Storing ’20s.
For example, at the start of the decade, the COVID-19 global pandemic taxed and tested supply chains throughout all industries and professions, healthcare being no exception. Then cargo container ship mishaps – one blocked the Suez Canal for six days, another slammed into a Maryland bridge – obstructing transport waterways and port access for products. In fact, the Suez Canal incident reportedly delayed transport of billions of dollars in goods by more than 400 ships. Fuel prices, labor disputes among dockworkers and trucking companies, taxes and flip-flopping tariff tactics, terrorist-related activities and a variety of weather-related phenomena only added to the market basket of mayhem.
All these events helped to poke holes in healthcare’s long embrace of just-in-time (JIT), modified stockless and stockless distribution since the 1990s and for many re-justified a return to bulk-buying and stockpiling, making overt and covert stashes a newly gilded badge of honor.
They also exposed cracks, gaps and holes in crisis planning and disaster preparations that grew out of the 9/11 terrorist attacks in New York City, Washington, DC, and Shanksville, Pennsylvania. These attacks resulted in nearly 3,000 fatalities, air traffic, ground transportation and travel grinding to a halt, access to New York City heavily restricted and the emergence of security measures that stressed supply chain fluidity going forward.
So far, healthcare supply chain executives, leaders and professionals have learned that planning and prepping strategies and tactics for geographically specific areas and varying types of crises and disruptions may not be so monolithic and standardized. Global, national, regional/state and local issues may require significantly different solutions or even minor tweaks to accommodate subtle nuances. Further, labor attitudes and workforce redirects – including hybrid scheduling, work-from-home options and automation technology – have emerged front and center to navigate around backorders and stockouts.
From climate- and weather-related crises to regulatory actions and policies to geopolitically motivated and terrorist-incited chaos to unprecedented operational incompetence and negligence, healthcare organizations have experienced – and will continue to face – a plethora of potential hiccups to clog the supply chain.
What they do – whether through proactive policies and procedures or post-event reactions – when the crisis or disruption hits can determine and direct future navigation.
The Journal of Healthcare Contracting tapped several healthcare supply chain leaders to share their observations and perspectives on categories of crises and disruptions from global, national, regional/state and local angles, highlighting potential tangible and useful solutions that sometimes involved overlapping benefits and drawbacks. Each presented viewpoints from different mindsets – one by crisis and disaster category, another by functional process and a third by local context.
Climate- and weather-related crises
This category spans floods, hurricanes, mudslides, tornadoes and wildfires, among others, that can close roads to vehicular traffic as the bulk of distribution to warehouse hubs and facility spokes relies on semi-tractor trailers and vans.
GLOBAL: From a global standpoint, proactive measures are massive and interlinked, according to Steve Downey, vice president, Chief Supply Chain & Support Services Officer, Cleveland Clinic. They include the use of monitoring, disaster warning systems, tracking locations of supplies, centralized alerts and coordination of global stockpiles.
Downey also recommended a “clear lineage of global supply tiers, where manufacturers would disclose origin, and critical component origins down tiers. For example, a sharps container manufacturer would disclose where they make product and where the key plastic components are sourced, and that information would be available to health systems that purchase the container. Then, if a world event happened that affected the key plastic supplier, all would be notified appropriately,” he indicated.
Benefits include improving visibility and preparedness across borders; saving each health system from having to research, triage, and monitor events individually; and preventing each country from having supplies that are rare or hard to source stored in stockpiles vs. in use, according to Downey.
Drawbacks involve requiring manufacturers to disclose information they may consider proprietary and maintaining that information centrally, Downey noted. Other needs include maintaining a central service provider and resolution of data intake and infrastructure globally.
NATIONAL: On the national front, solutions include training for all health systems on the handling of supplies for disaster response, a process that requires submission to a federal agency for manufacturing location, contract manufacturing location and critical raw materials siting, Downey insisted. He also called for a standard definition of “critical” supply and for a national alert system to resolve significant shortages in geographical areas or even nationally for critical supplies.
Benefits include each health system not having to research and triage on its own, according to Downey, and that training would lead to standardized terminology and practices. “More resources would go towards preventing significant shortages if alerts were more widely broadcast,” he added, “and funding and visibility to healthcare product shortages would increase.”
Drawbacks include solutions that would not be specific to individual types of care, systems or geographies; requirements would strain resources at health systems and manufacturers; and any origin disclosures would be considered proprietary and need to be maintained appropriately, Downey noted.
REGIONAL/STATE: These solutions would involve state-level emergency supply caches (e.g., linen, oxygen, personal protective equipment); mutual-aid agreements between regional health systems, and prepositioned supplies based on known risk patterns, interconnected systems or standards that allow for visibility into supply stockpiles, according to Downey.
Benefits include a better understanding of local geography and climate patterns, faster resource sharing between facilities that encourage regional cooperation and shared resources, he said.
Drawbacks center on limited budgets and resources, and shared risks may deplete resources quickly, he added.
LOCAL: Each organization would engage in hospital-level emergency stockpiling and continuity-of-care planning, local contracts with logistics providers and suppliers, staff training and drills for weather-related emergencies and developing and maintaining resiliency plans, Downey recommended.
Benefits include immediate response with minimal delay, greater control over local operations and enhanced staff readiness and patient safety, he said.
But drawbacks include being resource-intensive to maintain reserves with single solutions vs. multiple areas/systems sharing the risk and costs, according to Downey. “Planning must be up to date with regular practices (tabletop exercises) so there aren’t gaps when you need to enact,” he said. There also is the risk of facilities being impacted directly by disasters and dealing with hard-to-rotate perishable inventory (e.g., medications, linens), he added.
Geopolitically motivated and terrorist-incited chaos
This category spans citizen and/or structural attacks, cybersecurity violations and legislative/regularly/tariff-induced trade wars that can impact continuity of data accuracy, pricing and service accessibility.
GLOBAL: Solutions include global cybersecurity data sharing, a repository of country-of-origin data on all supplies and a supplier global cybersecurity standards/badging system, Downey suggested.
Benefits include advanced warnings and threat detection that encourage supplier cooperation and global solidarity, fast impact analysis on tariff scenarios and reduced labor on individual cybersecurity analysis by each health system, he said.
Drawbacks include data sensitivity and political barriers to full transparency, uneven participation among nations, threat actor visibility to preparedness and a reluctance to provide country of origin data due to competitive nature, he added.
NATIONAL: Downey called for national cybersecurity response plans, supplier vetting and promotion of American-produced supplies as solutions to domestic challenges.
Benefits include more control over domestic manufacturing and sourcing, faster federal support in case of cyber or terror attacks and improved coordination between private sector and government, he noted.
REGIONAL/STATE: This level will need state-based cybersecurity task forces and emergency management teams, regional simulations for cyberattacks or physical threats, cross-institutional data protection and sharing and standard risk ranking system across organizations, according to Downey.
Benefits include reducing lag in identifying and responding to threats, building technical capacity at the state level and encouraging collaboration between hospitals and state agencies, he noted.
Drawbacks include varying cyber maturity across regions, overlaps or conflict with federal actions and potential struggles with funding and staffing, he said.
LOCAL: These solutions involve redundant communications and backup power systems, local law enforcement integration in hospital security planning and a single database for organization, all of which provide benefits, he emphasized.
However, drawbacks include limited technical expertise within smaller systems, budget constraints may delay upgrades and that these options require constant vigilance and updates, he added.
Unprecedented operational accidents, incompetence and negligence
This category spans cargo container ship mishaps and navigational errors, labor unrest among coastal and internal ports and warehouse facilities.
GLOBAL: Because this addresses transportation by air, sea and land, the solutions involve interlinked processes that include global supplier mapping and diversified sourcing; real-time logistics tracking using artificial intelligence (AI) tools, trending to determine if risks are becoming prevalent, which types, and what’s working against them; and maintaining a registry of incidents to track each one with specific details, Downey recommended.
Benefits focus on tracking movement. These options help anticipate and reroute around blockages, reduce reliance on single channels or chokepoints, improve transparency in global supply chains, reduce each system having to solve problems on their own that lowers costs and redundancy, track to see which locations, sites, providers, infrastructure or root cause is leading to multiple situations, according to Downey.
The drawbacks translate to expensive tech implementation and a significant amount of data intake and real-time monitoring, he lamented.
NATIONAL: Solutions at this level call for a national contract framework for emergency logistics (e.g., alternate air/rail freight). “Imagine a simple ‘sign me up for this service’ checkbox for emergencies,” Downey posed. Additional solutions include national dashboards for port/logistics congestion and a registry of incidents to track each one with specific details.
Benefits involve shortening response time to major disruptions and reducing the chance of system-wide shutdowns, he said.
But Downey acknowledged drawbacks that include heavy reliance on federal action, a significant amount of data intake and real-time monitoring and a high cost for maintaining readiness,” he added.
REGIONAL/STATE: This level requires designated emergency delivery routes and storage hubs, according to Downey, as well as inter-hospital agreements for supply sharing and state logistics resilience planning, all of which generate and represent benefits for providers.
Among the drawbacks are that not all regions have a robust infrastructure and this involves complex coordination across counties or systems that are still reliant on upstream supply chain reliability, Downey indicated.
LOCAL: Within provider organizations, teams must develop and maintain facility-based surge planning for supply outages, agreements with local vendors for emergency supplies and on-site problem-solving teams that address logistical, administrative and clinical needs, Downey said.
Benefits include enabling continuity of care when outside systems fail and allowing fast, tailored responses, he noted.
Drawbacks include the possibility that resources may be quickly overwhelmed, staff may experience fatigue and burnout during prolonged outages and providers may have limited leverage in supplier negotiations, he added.
Functional awareness for process progress
Another way to examine options is to do it from a different perspective that focuses on functionality and process, regardless of crisis or disaster. For Masai Sung, senior director, Supply Chain Support Services, Stanford (CA) Medicine, potential solutions address contracting, external/third party use, substitute products and mutual aid.
“Stanford Medicine leverages a comprehensive approach to mitigate the effects of supply disruptions through a multi-layered strategy,” Sung told JHC. “Each method has its strengths and weaknesses, but their combined use enhances resilience in securing necessary supplies for patient care.”
Sung acknowledged that combining strengths and weaknesses enables you to bend enough to absorb or maneuver around weaknesses when necessary, which contributes to resiliency.
“However, as you know, nothing is 100%,” he countered. “These strategies used in concert with each other put us in a better position and can minimize the impact for when the disruption [occurs].”
Contracting benefit: “Understanding the historical impact and response to supply disruptions for manufacturers prior to the contracting process allows us a more thorough evaluation, focusing on their reliability and preparedness through business continuity plans and the locations of manufacturing and distribution facilities,” Sung indicated. “This allows for more intentional discussion and language around reliability and supply resiliency during the contracting process.”
Contracting drawbacks: “The market information available may lack specificity, particularly at the SKU level, which complicates the forecasting/visibility of supply issues,” he noted. “Because the supply chain is continuously evolving with M&A activity or cascading impacts within that supply category (e.g., raw materials) or issues with another manufacturer, the supplies related to the contract requires continuous monitoring. Additionally, the absence of Harmonized Tariff Schedule (HTS) codes can hinder the ability to anticipate tariff-related impacts.”
External/Third Parties benefit: “Engaging third-party vendors is a must,” Sung insisted. “They provide access to the required intelligence and consolidated data, along with real-time tracking of disruptions caused by natural disasters or geopolitical events. This external insight can help in making informed decisions quickly. Earlier this year tariff increases were announced; however, understanding the financial impact was a challenge given the variable rates by country and the impacted products. Our third-party partners gave us a better understanding to country of origin. This information then allowed our internal analytics team to model out what the financial impact could be to the enterprise for each hospital.”
External/Third Party drawbacks: “The data provided may sometimes be too generalized, lacking the specific details needed for immediate action, though it can still guide strategic responses,” Sung said. “Other times, the information may not hit the mark, and several iterations working with the third parties is required.”
Substitute Products benefit: “When establishing substitute products, the key is having the right clinical engagement proactively and partnership to ensure that the alternative is truly clinically equivalent,” Sung advised. “By pre-loading clinically acceptable substitute products into the Enterprise Resource Planning (ERP) system, Stanford Medicine can quickly adapt to supply disruptions. Strong clinical partnerships facilitate the identification of appropriate substitutes based on the criticality of the supply. Stanford has established an auto replenishment process.”
Substitute Products drawbacks: “Achieving timely agreement among various stakeholders across multiple hospitals can be difficult,” he continued. “Proprietary products or those closely tied to specific equipment may have limited alternatives, complicating the substitution process.”
Mutual Aid benefit: “Collaborating with local providers, whether through formal county arrangements or informal relationships, can ensure that necessary supplies are available to meet patient needs,” Sung said. “This approach is rooted in a shared commitment to patient care, fostering a spirit of cooperation among healthcare organizations.”
Mutual Aid drawbacks: “The effectiveness of mutual aid often relies on personal relationships and the capability of partner organizations to provide surplus supplies, which can vary significantly,” Sung concluded.
Local context, regional and national coverage
Marietta, Georgia-based Wellstar Health System uses regional and national contracting solutions to fortify local coverage and operations, according to Michael McCullough, senior vice president, Supply Chain.
“We don’t necessarily look at how a disruption happens or could happen, but more at how we maximize supply chain resiliency,” McCullough said.
Wellstar manages a 175,000-sq.-ft. Consolidated Service Center (CSC) that stores approximately 40 days stock-on-hand (DSOH) of its top 3,800 stock-keeping units (SKUs). Due to tariff and trade concerns, Wellstar recently raised its DSOH to 50, according to McCullough.
“At our point-of-use PARS, we stock up to 16 DSOH, via a 2-bin kanban solution that we refer to as ‘Wellbin,’” he explained. “Wellbin is our branded BlueBin solution. We rarely get 8 days per bin, but this would be our target. Space is our greatest prohibitor.
“For mission-critical supplies, we have contracts in place where a vendor will stock 30 DSOH of our key SKUs,” he continued. In this contract, McCullough listed five elements for which the vendor is responsible:
1. Managing the DSOH as defined in the contract.
2. Rotation of stock to ensure no short dating or expiration, where necessary.
3. Will ship the product when Wellstar makes the call.
4. Other key and proprietary criteria.
5. In some cases, the DSOH is 90.
“We have a small team that is responsible for monitoring information, including backorders and other industry news,” he indicated. “This team is also responsible for subs identification and management.”
As all three organizations weather the ongoing turbulence that roils supply chain operations, each encourages other organizations to adopt what’s necessary and adapt when necessary to keep the product and service pipeline filled and flowing as smoothly and consistently as possible.