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Drug shortages cost hospitals close to $360 million annually in labor expenses

Controlled substances, local anesthetics and antibiotics are among the most common drug categories where shortages had an impact.

Jeff Lagasse, Associate Editor

Drug shortages are challenging pharmacy teams in hospitals across the U.S. A new survey from Vizient finds that, on average, hospitals dedicate more than 8.6 million hours of additional labor hours annually to manage drug shortages.

The financial impact adds up to just under $360 million annually in labor costs for time spent seeking supply and implementing mitigation strategies that enable continuity of patient care.


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The survey, "Drug shortages and labor costs: Measuring the hidden costs of drug shortages on U.S. hospitals," also showed 100% of responding facilities have experienced shortages, with nearly two-thirds of respondents reporting that they had managed at least 20 shortages in the six-month period from July through December 2018.

Controlled substances, local anesthetics, antibiotics, electrolytes and emergency injectables such as "crash cart" drugs continue to be the most common drug categories where shortages have had the most impact on hospitals. Additionally, the survey showed that 38% of respondents reported one or more medication errors directly related to a drug shortage in that same time period.

Labor expenses related to managing shortages, both inside and outside the pharmacy, are creating a substantial burden on talent and resources for hospitals. The survey showed that 44% of hospitals were incurring staff overtime expenses and 46% were managing the additional time by redistributing the workload.

Survey respondents included 365 Vizient members from acute and non-acute care facilities across the country including health systems, academic medical centers, self-governed children's hospital, behavioral facilities, long-term care facilities, specialty hospitals and ambulatory care facilities.


Drug shortages can have a huge impact on spending. According to a January study from the National Opinion Research Center at the University of Chicago, nearly 80 percent of respondents said shortages led to either moderate or large spending increases and three quarters said they found it "extremely challenging" to get drugs in short supply during the study period, which could impact patient care.

Interviewees said drug shortages can substantially burden hospitals, often taking away time that should be dedicated to care delivery. Hospital pharmacies suffer significantly thanks to drug shortages because sterile injectables constitute the majority of drugs impacted by shortages and are primarily used in hospital settings, the study said.


"We know that, looking just at additional labor costs, the impact to U.S. hospitals annually is at least $360 million," said Dan Kistner, senior vice president, pharmacy solutions for Vizient. "When you also add the cost of more expensive alternative therapies, direct purchases outside the hospital's traditional channels, medication errors and cancelled or delayed medical procedures, we believe the actual cost of drug shortages to hospitals is significantly higher."

Twitter: @JELagasse

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