Events of Sept. 11 test just-in-time hospital supply network

October 17, 2001

Radiology departments that rely on just-in-time (JIT) inventory programs scrambled to make sure supplies were adequate in the aftermath of the attacks on the World Trade Center and Pentagon, which shut down the nation’s airline industry and

Radiology departments that rely on just-in-time (JIT) inventory programs scrambled to make sure supplies were adequate in the aftermath of the attacks on the World Trade Center and Pentagon, which shut down the nation’s airline industry and temporarily closed international borders. Suppliers of consumables and radiopharmaceuticals had to find ground transportation for products normally shipped by air, and radiology managers closely scrutinized on-hand supplies.

Radiopharmaceutical companies were challenged the most. The supply of molybdenum, used in about half of nuclear medicine procedures, was greatly affected, according to Randy Watt, marketing manager at Mallinckrodt in St. Louis.

“The restriction of air transportation created a crisis for nuclear medicine in the U.S.,” Watt said.

Most raw materials used to produce nuclear medicine imaging agents are sent by air either to specialized nuclear pharmacies or to hospital nuclear medicine departments. Radiopharmaceutical companies had problems with both receiving raw materials and shipping imaging agents to customers.

Immediately after the attack, Mallinckrodt pulled together a team from its distribution, marketing, manufacturing, and legal departments to begin planning a solution to the crisis. They reviewed the government’s guidelines for transporting vital medical supplies and spent hours on the phone and in person with federal officials and representatives from the Federal Aviation Administration, airlines, trucking firms, and law enforcement agencies.

“People pulled out all the stops to continue supply, but even planes that had clearance to enter U.S. airspace were ordered to fly into airfields in Canada,” Watt said. “They had to stay grounded (in Canada) until we were able to get them recleared.”

Business rivals had to become allies to provide vitally needed radiopharmaceuticals to hospitals and clinics.

“Not only did we support each other to voice our needs to the necessary governmental agencies for getting medical products distributed, we also serviced each other’s customers, when necessary,” Watt said.

With air transport canceled or severely curtailed, Mallinckrodt chartered special line-haul trucks to carry products from St. Louis to Los Angeles, Chicago, Dallas, and Atlanta. From these cities, local carriers were able to reach customers for final delivery. Nearly three weeks passed before operations returned to normal, but problems remain. Some commercial airlines still are not accepting cargo on passenger flights.

Mallinckrodt and other imaging agent companies were able to meet most customer needs, but the extra effort carried a hefty price tag. In the week after the attack, Mallinckrodt’s cost of supplying product to its customer base exceeded 500% of normal.

“Our fiscal year ends Sept. 30 and we had a very good year, so we were able to absorb these costs,” Watt said. “Had it been the start of the fiscal year, we would have spent several months trying to recover from these costs.”

Vendors and users of other consumables had similar, if less problematic, concerns. In the aftermath of the World Trade Center attack, Kodak focused on healthcare providers in New York City. The company sent customers there an 18-wheeler loaded with film, developing chemicals, and laser printers. Kodak also sent technical support staff to each trauma center to ensure that its equipment remained in good working order. But facilities in New York City and Washington, DC, were not the only ones affected by the attacks.

Providers nationwide were stressed when federal authorities shut down air travel. Efforts by vendors to ensure supply were boosted by hospital plans to conserve. At Dartmouth-Hitchcock Medical Center in Lebanon, NH, radiology department team leaders worked to maintain inventory without affecting patient care.

“Normally, we keep four to five days’ worth of supplies on hand, and we were fortunate in that we had just received a delivery,” said Monte Clinton, FAHRA, administrative director of radiology. “But as news came in and we wondered if the transportation restrictions would become wider, we set up a resource conservation program.”

JIT inventory systems have gained popularity nationwide for managing supply and storage costs. Dartmouth-Hitchcock switched to JIT in 1992, reducing the volume of its in-house inventory of radiology supplies from an average value of $400,000 to $16,000. Storage space was reduced from 126 linear feet to an average of 25 linear feet. But the Sept. 11 attacks and the effect on the nation’s product distribution systems underscored the importance of ongoing assessment.

Clinton’s team determined that film conservation was a priority, and imaging protocols were examined to see how the number of films per study could be reduced without affecting needed diagnostic information. The department also checked with Kodak to find out if the vendor’s film supplies would be running short.

The American Healthcare Radiology Administrators (AHRA) alerted its members, especially those that normally depend on overnight shipment, to implement supply conservation efforts. FedEx air shipments were halted for more than 48 hours, according to company spokesperson Jennifer McGowan.

From Sept. 11 to Sept. 13, all air transportation was halted, and products were rerouted from FedEx’s fleet of planes to its ground fleet of more than 9500 trucks. Medical supplies were given top priority.

“We kept medical supply shipments a priority until all operations resumed,” McGowan said.

Although most facilities had enough routine supplies on hand, occasional shortfalls did occur. A hospital in North Carolina was unable to get a needed part for a linear accelerator and had to refer some cancer patients to another hospital for radiation therapy. Presbyterian Hospital in Albuquerque faced a weekend shortage of xenon gas. Other facilities reported minor shortages of catheters and guidewires.

In New York City, supplies are holding up, but problems with computer systems, particularly computerized billing, have emerged. The billing center for Empire Blue Cross/Blue Shield was in the World Trade Center, said Dr. Burton Drayer, chair of radiology at Mount Sinai Hospital in NYC.

“We’ve had to go back to paper billing,” Drayer said. “We’re dealing with delayed billing and delayed collection. Other than that, we seem to be okay. All the vendors did an excellent job at keeping us well supplied.”