Inventory and Supply Management Flashcards

A hospital supply manager notices that a critical surgical item frequently runs out mid-month despite reorder points being set. Which corrective action is MOST appropriate?

Answer: Increase the reorder quantity and safety stock level

Increasing reorder quantity and safety stock directly addresses chronic stockouts by building a buffer against demand variability.

Under a consignment inventory agreement, when does the healthcare facility actually pay for the supplies?

Answer: When the item is used or consumed

Consignment agreements mean the facility only pays the vendor when an item is actually consumed or used, reducing carrying costs.

Which inventory costing method assigns the most recent purchase prices to the cost of goods sold, potentially understating ending inventory value in a period of rising prices?

Answer: LIFO (Last-In, First-Out)

LIFO assigns the latest (most expensive) costs to cost of goods sold, leaving older (cheaper) costs in ending inventory, understating its value when prices are rising.

A healthcare leader wants to reduce the total cost of ownership (TCO) for medical supplies. Which factor is LEAST likely to be included in TCO analysis?

Answer: The vendor's annual marketing budget

TCO includes all costs the facility incurs (purchase, storage, training, disposal), not internal costs of the vendor such as their marketing budget.

What is the primary purpose of a par-level system in hospital supply management?

Answer: To set the maximum and minimum quantity of a supply item to keep on hand

Par-level systems define the minimum quantity that triggers reorder and the maximum quantity to stock, ensuring consistent availability without overstocking.

A supply chain disruption causes a hospital to face a shortage of single-use surgical gowns. Which interim strategy BEST balances patient safety and operational continuity?

Answer: Identify and qualify an alternative approved supplier immediately

Qualifying an alternative approved supplier maintains patient safety standards while restoring supply, making it the best balanced interim strategy.

In the context of healthcare supply management, what does 'demand forecasting' primarily help a manager accomplish?

Answer: Predict future supply needs based on historical usage patterns

Demand forecasting uses historical consumption data and trends to predict future supply needs, reducing stockouts and overstock situations.

A healthcare supply manager discovers that a high-cost implantable device was used in a surgery but never documented in the inventory system. This is an example of a failure in which process?

Answer: Point-of-use capture and charge capture

Point-of-use capture ensures that supply usage at the care delivery point is recorded for inventory tracking and accurate patient billing simultaneously.

Which of the following BEST describes the 'economic order quantity' (EOQ) model?

Answer: The quantity that minimizes total inventory costs by balancing ordering costs and holding costs

EOQ calculates the order size that minimizes the sum of ordering costs and inventory holding costs, resulting in the lowest total cost.

A healthcare leader is reviewing vendor performance. Which combination of metrics provides the MOST comprehensive evaluation of a medical supply vendor?

Answer: On-time delivery rate, fill rate, defect rate, and pricing compliance

A comprehensive vendor scorecard includes delivery reliability, fill rate, quality metrics, and pricing compliance to assess all dimensions of supplier performance.

In supply chain risk management, 'single-source dependency' refers to:

Answer: Using only one supplier for a critical supply item, increasing vulnerability to disruption

Single-source dependency means having only one supplier for a critical item, which creates significant risk if that supplier faces disruption, bankruptcy, or quality issues.

What is the primary advantage of implementing Radio Frequency Identification (RFID) technology in hospital supply management?

Answer: It enables real-time, automated tracking of supply location and inventory levels

RFID tags allow automated, real-time tracking of supplies throughout the facility without manual scanning, improving inventory accuracy and reducing shrinkage.

A hospital is transitioning from a traditional 'push' supply replenishment model to a 'pull' model. What is the key operational difference?

Answer: In a push model, supply is sent based on forecasts; in a pull model, replenishment is triggered by actual consumption

Push systems distribute supply based on predicted demand forecasts, while pull systems replenish only in response to actual consumption signals.

When conducting a periodic inventory count versus a perpetual inventory system, what is the main operational distinction?

Answer: Perpetual systems update records with each transaction; periodic systems reconcile on a set schedule

A perpetual system updates inventory in real time with every transaction, while a periodic system reconciles actual stock to records at scheduled intervals.