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Pamela Krnavek is passionate about the accessibility of healthcare for all patients. A career that began as a nurse almost 40 years ago has transformed into roles in value analysis and a focus on the financial health of small hospitals.
“I’ve worked in large hospitals and small hospitals, including rural hospitals where there’s no other healthcare facility for miles,” she said. “It’s my intention to help those hospitals remain viable so that they can complete their mission of caring for patients. That is part of my moral compass.”
Ms. Krnavek, RN, CVAHP, is System Manager of Value Analysis for PeaceHealth and Chief Administrative Officer of Duvera Solutions Group, a firm that assists hospitals and device companies with value analysis and clinical integration. She said that inflationary supply costs and higher labor costs, without increased reimbursement, require organizations of every size to scrutinize products on price, clinical outcomes, length of stay and patient throughput.
While value analysis committees (VACs) have been around for years, they continue to evolve. Navigating the different program structures and stakeholders at hospitals is a primary challenge for orthopedic companies, especially small ones with fewer human resources.
Recently, more device companies have sought out Ms. Krnavek’s expertise to help them enter hospital organizations, including presenting to VACs and integrating with clinical and supply chain functions. She always stresses that success requires much more than a surgeon champion. “The physician is no longer your primary customer. The health system is your customer,” she said.
We asked Ms. Krnavek to share her perspective on ways that orthopedic companies can better prepare to serve hospital customers.
How has the VAC process evolved since you started in this line of work?
Ms. Krnavek: When I began 15 years ago, it was about price and whether the product was clinically acceptable. Clinical integration is the pinnacle of programs today. The structure has representatives from multiple departments, including physicians, as key stakeholders. This advanced model brings structure to objective decision-making to achieve the best decisions for the patient and the organization.
What parts of the value analysis process do you see companies struggle with the most?
Ms. Krnavek: The various structures of value analysis across the industry. There are four levels of maturity. This leaves the vendors confused about where to start and who to engage in the approval process.
PeaceHealth’s value analysis program is clinically integrated with physicians, nurse leaders, supply chain, education, infection prevention, and revenue integrity at the table. We review published research, revenue, coding, education needs, potential risk, GPO contract compliance and more — it has layers of complexity. A hospital in the beginning stages of a value analysis program might only look at cost and hospital/procedural margins before they adopt a new product.
I coach vendors on the creation of an executive package that translates to all stakeholders, no matter the level of the value analysis program that they’re working with. In return, the package helps the hospital’s VAC to consider, ‘Where did this research come from? What is the billing code? What does this product mean for revenue, patient throughput, risk management?’
Everybody is busy, and even more so in smaller hospitals where they wear multiple hats. Vendors should be concise, eliminate the sales pitch “fluff” and hone in on the patient benefits, ROI, cost of ownership and solving a problem the hospital faces. I help clients narrow down what value analysis leadership wants to hear and anticipate the questions they’re going to be asked during the process. The efficiency makes both sides of the business transaction happy.
What mistakes do companies make with value analysis and clinical integration?
Ms. Krnavek: Vendors are eager to sell, but there are policies and procedures to introduce new products to any hospital system. If you don’t follow that process, “backdoor” a product without approval and it gets implanted in a patient, you risk denial of payment (No PO, No Pay) and suspension of your privileges, not to mention an upset VA team that will push back on your company. Service recovery is not where you want to start. The surgeon champion selling model no longer leads to success and relationship longevity with your company.
There are several impacts on both sides to doing this. One is loss of revenue. The hospital doesn’t pay and the implant isn’t billed, which impacts the margin for the procedure. Two is risk. It opens the hospital to liability if the product isn’t vetted, approved vendor processes are not completed and training isn’t done, especially if a patient experiences harm from the product. Three is implementation. A health entity prefers to implement products systemwide because of social justice, health equity and volume purchasing discounts.
It is a mistake to focus on a single sale instead of strategic alignment with the customer to achieve longevity. The value analysis process protects the patient, supports the organization’s financial goals and streamlines operational support for conversions. The VAC leads the project and facilitates between vendor, distributor, supply chain, education and clinicians to provide a smooth transition of product changes.
How can orthopedic companies specifically help hospital supply chain professionals?
Ms. Krnavek: First of all, digital and hands-on education support through champion training and end-user (at the elbow) interaction. Second, hospital assistance with product exchange on the shelves. Third, after due diligence to burn down existing inventory on the shelf, make an even swap with existing inventory so inventory write-off doesn’t occur.
What are some of the biggest challenges small hospitals face, and how might orthopedic companies help them respond to those challenges?
Ms. Krnavek: Bandwidth! Train all staff well so their skillset is solid to use new products, especially when individuals might be on-call. Orthopedics is complex. Every system has it’s tips and tricks. Excellent customer service creates preferred vendor status when decisions to renew contracts are made.
What trends in healthcare excite you the most?
Ms. Krnavek: Product innovation and self-distribution. Innovation solves problems for nurses and physicians. Distribution reduces supply expense, increases vendor market share and builds hospital inventory depth during ongoing supply chain instability.
A direct-from-manufacturer relationship benefits both sides of the table. Preferred vendor status, access to supply chain leadership and being “on formulary” provide a device company an advantage over its competitors. Implant tracking may be problematic for manufacturers but can be resolved with out-of-the-box thinking. Large healthcare systems often have an affiliate network of hospitals that want to participate in this arrangement. This further enhances market share for vendors.
I’m excited about product innovation by clinicians. I’m jumping into that space because I think some things can be improved from a nurse’s standpoint. A scrub tech might ask, ‘Why doesn’t the product do this? Have you thought about changing it?’ Reps should share feedback from clinical staff with R&D.
Pamela Krnavek is passionate about the accessibility of healthcare for all patients. A career that began as a nurse almost 40 years ago has transformed into roles in value analysis and a focus on the financial health of small hospitals.
“I’ve worked in large hospitals and small hospitals, including rural hospitals where there’s no other...
Pamela Krnavek is passionate about the accessibility of healthcare for all patients. A career that began as a nurse almost 40 years ago has transformed into roles in value analysis and a focus on the financial health of small hospitals.
“I’ve worked in large hospitals and small hospitals, including rural hospitals where there’s no other healthcare facility for miles,” she said. “It’s my intention to help those hospitals remain viable so that they can complete their mission of caring for patients. That is part of my moral compass.”
Ms. Krnavek, RN, CVAHP, is System Manager of Value Analysis for PeaceHealth and Chief Administrative Officer of Duvera Solutions Group, a firm that assists hospitals and device companies with value analysis and clinical integration. She said that inflationary supply costs and higher labor costs, without increased reimbursement, require organizations of every size to scrutinize products on price, clinical outcomes, length of stay and patient throughput.
While value analysis committees (VACs) have been around for years, they continue to evolve. Navigating the different program structures and stakeholders at hospitals is a primary challenge for orthopedic companies, especially small ones with fewer human resources.
Recently, more device companies have sought out Ms. Krnavek’s expertise to help them enter hospital organizations, including presenting to VACs and integrating with clinical and supply chain functions. She always stresses that success requires much more than a surgeon champion. “The physician is no longer your primary customer. The health system is your customer,” she said.
We asked Ms. Krnavek to share her perspective on ways that orthopedic companies can better prepare to serve hospital customers.
How has the VAC process evolved since you started in this line of work?
Ms. Krnavek: When I began 15 years ago, it was about price and whether the product was clinically acceptable. Clinical integration is the pinnacle of programs today. The structure has representatives from multiple departments, including physicians, as key stakeholders. This advanced model brings structure to objective decision-making to achieve the best decisions for the patient and the organization.
What parts of the value analysis process do you see companies struggle with the most?
Ms. Krnavek: The various structures of value analysis across the industry. There are four levels of maturity. This leaves the vendors confused about where to start and who to engage in the approval process.
PeaceHealth’s value analysis program is clinically integrated with physicians, nurse leaders, supply chain, education, infection prevention, and revenue integrity at the table. We review published research, revenue, coding, education needs, potential risk, GPO contract compliance and more — it has layers of complexity. A hospital in the beginning stages of a value analysis program might only look at cost and hospital/procedural margins before they adopt a new product.
I coach vendors on the creation of an executive package that translates to all stakeholders, no matter the level of the value analysis program that they’re working with. In return, the package helps the hospital’s VAC to consider, ‘Where did this research come from? What is the billing code? What does this product mean for revenue, patient throughput, risk management?’
Everybody is busy, and even more so in smaller hospitals where they wear multiple hats. Vendors should be concise, eliminate the sales pitch “fluff” and hone in on the patient benefits, ROI, cost of ownership and solving a problem the hospital faces. I help clients narrow down what value analysis leadership wants to hear and anticipate the questions they’re going to be asked during the process. The efficiency makes both sides of the business transaction happy.
What mistakes do companies make with value analysis and clinical integration?
Ms. Krnavek: Vendors are eager to sell, but there are policies and procedures to introduce new products to any hospital system. If you don’t follow that process, “backdoor” a product without approval and it gets implanted in a patient, you risk denial of payment (No PO, No Pay) and suspension of your privileges, not to mention an upset VA team that will push back on your company. Service recovery is not where you want to start. The surgeon champion selling model no longer leads to success and relationship longevity with your company.
There are several impacts on both sides to doing this. One is loss of revenue. The hospital doesn’t pay and the implant isn’t billed, which impacts the margin for the procedure. Two is risk. It opens the hospital to liability if the product isn’t vetted, approved vendor processes are not completed and training isn’t done, especially if a patient experiences harm from the product. Three is implementation. A health entity prefers to implement products systemwide because of social justice, health equity and volume purchasing discounts.
It is a mistake to focus on a single sale instead of strategic alignment with the customer to achieve longevity. The value analysis process protects the patient, supports the organization’s financial goals and streamlines operational support for conversions. The VAC leads the project and facilitates between vendor, distributor, supply chain, education and clinicians to provide a smooth transition of product changes.
How can orthopedic companies specifically help hospital supply chain professionals?
Ms. Krnavek: First of all, digital and hands-on education support through champion training and end-user (at the elbow) interaction. Second, hospital assistance with product exchange on the shelves. Third, after due diligence to burn down existing inventory on the shelf, make an even swap with existing inventory so inventory write-off doesn’t occur.
What are some of the biggest challenges small hospitals face, and how might orthopedic companies help them respond to those challenges?
Ms. Krnavek: Bandwidth! Train all staff well so their skillset is solid to use new products, especially when individuals might be on-call. Orthopedics is complex. Every system has it’s tips and tricks. Excellent customer service creates preferred vendor status when decisions to renew contracts are made.
What trends in healthcare excite you the most?
Ms. Krnavek: Product innovation and self-distribution. Innovation solves problems for nurses and physicians. Distribution reduces supply expense, increases vendor market share and builds hospital inventory depth during ongoing supply chain instability.
A direct-from-manufacturer relationship benefits both sides of the table. Preferred vendor status, access to supply chain leadership and being “on formulary” provide a device company an advantage over its competitors. Implant tracking may be problematic for manufacturers but can be resolved with out-of-the-box thinking. Large healthcare systems often have an affiliate network of hospitals that want to participate in this arrangement. This further enhances market share for vendors.
I’m excited about product innovation by clinicians. I’m jumping into that space because I think some things can be improved from a nurse’s standpoint. A scrub tech might ask, ‘Why doesn’t the product do this? Have you thought about changing it?’ Reps should share feedback from clinical staff with R&D.
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Carolyn LaWell is ORTHOWORLD's Chief Content Officer. She joined ORTHOWORLD in 2012 to oversee its editorial and industry education. She previously served in editor roles at B2B magazines and newspapers.
