Supply chain costs are one of the largest expenses for both hospitals and health systems, and can account for up to one-third of total operating expenses at some hospitals. These costs include not only necessary medical and surgical supplies like pharmaceuticals, medical devices, and personal protective equipment (PPE), but also purchased services like food preparation and laundry or linens.
Supply costs can be impacted by external factors like rising pharmaceutical prices, but internal expenses like physician preference items (PPIs) can also have a significant influence on overall supply chain spending. Though PPI spending and supply costs are more discretionary than other hospital expenses, supply chain spending has been on an upward trend since at least 2014. According to Definitive Healthcare data, U.S. hospitals spent a combined total of $36 billion on medical and surgical supplies in 2018—with an average of $11.9 million per hospital.
Below, we've compiled lists of the top 25 hospitals by medical and surgical supply costs, and the top 25 hospitals by laundry and linen expenditures.
Which U.S. hospital has the greatest total medical and surgical supply costs?
University of Texas MD Anderson Cancer Center has the greatest overall medical and surgical supply costs—with just over $974 million in medical and surgical supply costs reported as of July 2020. It's unsurprising that a specialized research facility might report the highest supply costs, especially given the type of expensive, cutting-edge new treatments that a cancer center like this one is likely to provide.
In fact, almost all of the top 25 hospitals by medical and surgical supply costs are either cancer centers or academic medical centers. Both of these facility types focus on providing advanced treatments and therapies to patients with often highly complex conditions. Due to the nature of the care that these facilities provide, they're more likely to spend more on necessary medical and surgical supply costs than other community hospitals might.
Which U.S. hospital has the highest total linen costs?
As of July 2020, NewYork Presbyterian/Weill Cornell Medical Center had the highest total linen costs—with a reported total of over $14.2 million. Though there is a strong correlation between total number of staffed beds and total linen costs, NewYork Presbyterian does not have the highest total bed count of the hospitals on this list. This hospital did, however, report the greatest number of patient discharges—which likely explains the facility's high linen cost.
Interestingly, Ronald Reagan UCLA Medical Center and Loma Linda University Medical Center reported both the lowest number of staffed beds and the lowest number of discharges. Despite this, both hospitals report greater total linen costs than other facilities with more staffed beds or discharges. This could indicate an opportunity to optimize laundry and linen expenditures as a way to control overall supply chain spending.