By CNN & Miami Herald
Below are two articles published within a day of one another. The CNN article highlights the continued need for PPE in health care facilities. The Miami Herald article features a manufacturer making PPE in the U.S. that no one will buy. While these are just two examples, we believe they are reflective of the disconnect that continues to exist within the U.S. when it comes to PPE supply chains.
CNN: As Covid-19 Cases Surge, Health Care Workers Say PPE is Still a Struggle
As the country grapples with surging coronavirus cases, some hospitals, clinics and nursing facilities are still struggling to maintain adequate supplies of personal protective equipment.
After international supply chains were severely disrupted early in the pandemic, states were left battling each other for limited shares of PPE. Hospitals and other facilities, especially in the Northeast, faced dwindling supplies and obstacles to obtaining more.
Months into the pandemic, concerns still linger in some facilities.
"While hospitals and health systems are better positioned with on-hand inventory levels, serious concerns continue regarding the availability of PPE and other supplies as COVID cases continue to increase across the country and we enter the flu season," Mike Schiller, the director of supply chain at the Association for Health Care Resource & Materials Management at the American Hospital Association, told CNN in an email.
During the White House Coronavirus Task Force briefing on Thursday -- the first such briefing since July -- Brig. Gen. David Sanford said the Strategic National Stockpile is growing, and has a four-month surge capability of N95 masks.
"Since the late summer, we have grown our personal protective equipment capabilities 10 to 15 times over what they were pre-Covid, and continue to grow capability to meet the surge requirements that we may expect from the current caseload," Sanford said.
"We stand in a much better position than we were just a month ago, and certainly more than four or five months ago, to meet the surging PPE demands of our nation."
However, health care workers around the country said hospitals and other facilities are still using PPE much differently than before the pandemic. Doctors describe storing N95 respirators in paper bags between uses, and making supply conservation a part of the routine.
"My colleagues across the country are reusing N95s for as long as they can. Many hospitals are still using hand sanitizer that they make in house instead of buying it from purchasers, etc," said Dr. Megan Ranney, an emergency physician at Brown University, who helped found the the nonprofit Get Us PPE.
The group also created a database to track requests for PPE donations, and a "shortage index" to identify where levels of PPE are becoming dangerously low. It reported in October that it received 16,900 requests for donated items from facilities in 40 states and Washington, DC.
Ranney expects more requests are coming.
Who's Doing Better
Personal protective equipment includes basic medical-grade necessities, such as face masks, N95 respirator masks, face shields, surgical gowns, gloves and disinfectants, such as hand sanitizers -- necessities that health care workers use to safely care for Covid-19 patients.
Some types of facilities have fared better than others, according to Dr. Sunny Jha, an assistant professor of anesthesiology at the University of Southern California and co-founder of the Los Angeles Surge Hospital.
Large integrated health systems and academic medical centers are better supplied than smaller health systems, "mom and pop" clinics and doctor's offices throughout the country, Jha said. Conditions also have not improved much for rural and smaller independent facilities in the ensuing months.
California hospitals fared better in the beginning of the pandemic and were able to stockpile PPE early on as they watched what was unfolding in the Northeast, Jha said.
"We were fortunate in that regard, but I think the folks that really got it the worst were the smaller community hospitals -- hospitals that are not necessarily part of a larger integrated health system that had to compete with larger health systems, and their orders (for PPE) -- the ones that didn't necessarily have connections to the large suppliers," Jha said.
Ranney agreed, but said even big health systems are struggling.
"While most larger hospitals have managed to buy at least the bare minimum of PPE to outfit their employees, they don't certainly have large supplies they're sitting on," said Ranney, who is also a CNN medical analyst.
Dr. Judith Guzman-Cottrill, a member of a US Centers for Disease Control and Prevention advisory committee on infection control, said in a recent meeting the agency acknowledged that "supply chains continue to change quickly for hospitals."
"Some weeks the supply is good, then the next week it can be unreliable," said Guzman-Cottrill, a pediatrician with the Division of Infectious Diseases at Oregon Health & Science University.
PPE Items Most in Need
The US Department of Health and Human Services has worked to expand the supply of PPE in the United States since last spring, Schiller of AHA said, but "demand continues to outpace production."
Supply issues with nitrile gloves, isolation gowns, N95s and testing supplies "continue to present a challenge to hospital leaders”, he said.
Maintaining adequate supplies of N95 masks has been difficult for most health care facilities in the US throughout the pandemic. During the initial wave of Covid-19 cases in March and April, N95 respirator masks -- which can filter out at least 95% of all types of airborne particles, including bacteria and viruses, according to the CDC -- were in high demand and short supply.
In Oregon, Guzman-Cottrill said there's a need for all PPE items, but especially masks.
"Many hospitals, including mine, are still following 'extended use' and 're-use' of N95 respirators and facemasks," she said.
The Wisconsin Department of Health told CNN that health facilities in the state, which has seen a jump in coronavirus cases in recent weeks, are seeing a shortage of gloves.
"Currently, exam gloves are in short supply," spokeswoman Elizabeth Goodsitt told CNN.
"However, we have exam gloves... in our state cache to help facilities that have delays in their supply chain."
Nursing Homes and Long-term Care Facilities
Limits on PPE can affect all types of health facilities, not just hospitals. Nursing homes and long-term care facilities are facing critical PPE shortages.
Back in May, the American Health Care Association National Center for Assisted Living (AHCA-NCAL), which represents some 15,000 facilities across the US, sent a letter to HHS asking for assistance.
"The lack of PPE has also put caregivers at a serious disadvantage in protecting themselves as they care for the vulnerable population who reside in our facilities. More than 70 percent of our long term care providers have been unable to find sufficient PPE supplies, like masks, gowns and face shields, and are facing shortages," the AHCA-NCAL wrote.
Look forward six months, and the situation with PPE is still precarious, the nonprofit said.
"While the availability of PPE has improved, we're still hearing from providers about struggling to acquire supplies," the group told CNN in an email. "There are supplies out there, but it's just not getting to our sector."
The AHCA-NCAL said it's seeing a greater demand for supplies of PPE across all health care settings and sectors now as hospitals fill up again and coronavirus infection rates climb to record numbers almost daily.
"This not only makes it difficult for long term care providers to obtain PPE, but also their ability to afford it -- the cost has skyrocketed," the nonprofit added.
"We need manufacturers to make more PPE that can be used by long term care, as well as suppliers and state agencies to prioritize our facilities for these supplies."
Miami Herald: This Miami Supplier is Manufacturing Millions of Masks. Why Won’t Anyone Buy Them?
As the COVID-19 pandemic roared to life this spring, the U.S. found itself faced with an acute shortage of masks and other personal protective equipment to support front-line workers.
The issue was highlighted by images of American doctors and nurses wearing garbage bags in lieu of proper medical garb. The photos went viral.
Today, America’s PPE supply chain is lurching back to life. Yet many hospitals, businesses and state and local governments still remain short on medical-grade face coverings as they continue to exhaust existing supplies.
DemeTech, a Miami-area medical device manufacturer, has been trying to bridge the gap by hiring hundreds of new workers to make Food and Drug Administration-approved surgical masks — which only look like ones you’d buy at a corner store — and Centers for Disease Control-approved N95 respirators. While others in Florida, including Miami Gardens-based ICO Uniforms, have also begun producing face coverings, DemeTech appears to be the only firm in the state to have begun turning out N95 respirators that have been tested and approved by the Centers for Disease Control and Prevention.
But DemeTech has learned that American PPE buyers remain stuck in their ways.
“We’re very expensive,” said DemeTech vice president Luis Arguello Jr. “We’re creating jobs and paying really good salaries — the economic ripple effect is great. But how do we compete? We don’t.”
Cost remains the biggest factor — not because masks are expensive, but because DemeTech pays its workers more than firms in China do. It currently sells N95 cup-style respirators for $79.99 for a box of 20.
“To make a product in the U.S., you have to pay a living wage,” said Kim Glas, president and CEO of the National Council of Textile Organizations, a trade group whose members include mask makers.
DemeTech faces additional hurdles, including regulations and access to the industry’s primary sales channels that further impede its ability to sell. Most hospitals, Glas said, have longstanding relationships with distributors that they use regularly. Smaller companies like DemeTech struggle to find footing — especially as overseas production resumes.
“If you’re a manufacturer who wasn’t really in the space, or came into the space because of demand, the question is where do you fit now that global supply chains have been ramped up?” she said.
Right now, Arguello said, the U.S. government is DemeTech’s largest customer — but only thanks to an executive order mandating the purchase of American-made products for federal entities.
When it comes to most states, cities and private companies, Arguello said, “it’s straight price.”
DemeTech’s pivot to masks was made possible thanks to a connection through the U.S. Department of Defense’s Advanced Functional Fabrics of America, an initiative launched by the Obama administration to increase federal investment in textile technology.
When the pandemic hit, DemeTech formed a partnership with Tennessee-based Oak Ridge National Laboratory, which was developing technology to boost domestic N95-mask production.
But DemeTech quickly discovered that longstanding supply chain mechanisms aren’t easily reoriented.
“The problem is, unless you’ve got an in with a [large] distributor...it’s difficult for a manufacturer to sell,” said Rob Handfield, a professor of supply chain management at North Carolina State University and executive director of the school’s Supply Chain Resource Cooperative. “[Smaller companies] don’t have the distribution capabilities, the information systems...they don’t have a sales channel.”
The federal government has responded to the PPE supplies issue as it would to a hurricane, preferring a “locally executed, state managed, federally supported” role. But experts say this has translated into every jurisdiction fending for itself.
And the rules for many states and local municipalities dictate that, all else being equal, price wins out when it comes to making bids, said Georg Neumann, head of communications at the Open Contracting Partnership, a nonprofit that advocates for fair and effective public contracting.
“So quality, or the fact that they can deliver in time, are factors that are not integrated well into our procurement system,” Neumann said.
While most large hospitals now seem to have adequate PPE, many solo practitioners and small practices are leaning on personal connections, or simply going to Costco, for their supplies, said Abram Berens, president of the Broward County Medical Association. That, too, brings cost into the picture.
Berens said he had not heard of DemeTech, but upon learning of their pricing said it seemed above what an N95 mask would have cost prior to the pandemic.
To get its products in front of more potential buyers, DemeTech has partnered with another upstart, South Carolina-based Rhino Medical Supply. Founded by a former Wells Fargo executive in May, Rhino has tried to corner the market on new U.S. manufacturers like DemeTech.
“In this world, there’s just a lot of craziness, a lot of shadiness,” said Rhino founder and CEO Lance Brown.
The Miami Herald reported in April that Florida officials had booked $7 million worth of masks from a former contestant on the TV show “Shark Tank.”
He continued: “So having a direct relationship with a manufacturer is really important. So we saw hospitals experiencing issues with lead times, tariffs, trade wars, and we knew we wanted to position ourselves going more domestic to keep us growing.”
Most governments and healthcare providers would take an American supplier if they could, Brown said. But right now, many are operating under crushing budget constraints.
“Nine out of 10 times, they would buy American,” he said. “But during a pandemic...they have to make some tough decisions to go with something that makes more economic sense. I don’t think they want to buy overseas, but given existing purchasing systems, and no more big budgets, they’ve got to do what they’ve got to do.”
Still, Brown says he’s been able to sell at least one million DemeTech masks, mostly to healthcare providers. DemeTech declined to release client names but asked several to comment; none agreed to be interviewed.
“That speaks to the quality of DemeTech and what they produce,” he said. “A lot of folks go to what they know...even if masks do the same thing, or not as good quality, they think they can trust it.”
As the latest wave of coronavirus cases bears down, supply chains could face another stress test.
“This second wave is going to be pretty bad,” Handfield said. He added: “We’re still seeing shortages, particularly in hospitals now seeing a huge influx of patients. The burn rate is pretty significant when you look at how quickly they’re going through these masks and gloves.”
But he is pessimistic about U.S. end-users’ ability to shake their addiction to low-cost goods.
“Are we going to go back to our old ways, buying faster and cheaper and go to China? That’s got to change,” Handfield said. “We’ve learned a lesson, but people are weird that way, and forget those lessons.”
Dave Rousse, president of INDA, the leading global association representing N95 makers and other specialty fabrics producers, agreed.
“If the U.S. healthcare community wants low prices but an interruptable supply chain, it will continue to buy from Asia,” he said. “If it wants something secure, it’s going to have to pay a price premium.”
Brown said DemeTech is close to reaching an economy of scale that will bring down its price and make it more affordable. This week, DemeTech announced it was opening a fourth, 156,000-square-foot facility in Miami Lakes for $15 million. It has also opened an online store where masks can be purchased directly.
“People have to buy U.S. products,” Arguello said. “We have to spend a little more. Our long-term vision is going to depend on the U.S. consumers.”