The French healthcare system in the storm: Logistical learning from the pandemic

At the height of the Covid-19 crisis, two years ago, French authorities suddenly realized that their hospital system was in danger of being overwhelmed by an uncontrollable wave of patients in acute respiratory distress, which far exceeded the hospital bed capacity.

As soon as the Covid-19 pandemic spread in France, a rapid assessment of facilities was carried out, with an alarming finding: only 5,000 hospital beds available to receive patients in acute respiratory distress, with the associated resuscitation equipment and personnel, i.e., 7.5 beds per 100,000 inhabitants. That compared to 29 beds per 100,000 inhabitants in Germany.

From mid-March 2020, the French hospital system experienced an explosion in demand for care. The political authorities were very quickly confronted with a crisis for which they were not prepared: what measures should be adopted to contain the growing flow of patients?

Looking back over the past two years, it is possible to speak of an exceptional capacity for logistical resilience, making it possible to avoid the terrible trade-off between those who have the right to live and those who are condemned to die for lack of a sufficient number of beds. We can mention three forms of logistical resilience, the power of which was unsuspected before the health crisis, but which will serve as a lesson in the event of future major pandemics. In brief, what is the logistical learning from the analysis of the French case?

Reducing demand for care

It is common for a manufacturing company that does not have sufficient order preparation and/or transport capacity to supply stores, drives or outlets, to negotiate with its customers a delivery delay, even if it means offering them a one-off commercial advantage, such as a significant discount on future purchases.

Such a strategy is based on a voluntary slowing down of product flows in order to synchronize capacities and logistical needs. The lockdown decision taken by President Macron on March 17, 2020, and repeated several times thereafter, is clearly in line with this restraint strategy; it is not surprising that it has been adopted by so many countries around the world.

The logistical resilience here was based on demand reduction in hospitals: the processing of demand for care was adjusted to the capacity to satisfy demand for care, as would an online retailer with a temporary product shortage.

As previously mentioned, the initial capacity of 5,000 hospital beds for intensive care was known in France when the state of pandemic was declared by the WHO in March 2020. It was therefore essential that the number of patients to be treated did not exceed this number in the initial period of external shock, at the risk of an explosion in mortality.

To achieve the load/capacity match, contagion had to be curbed by drastically reducing contact between Covid-19 positive or asymptomatic people and healthy people with protective measures such as social distancing and lockdown. On many occasions, the French Minister of Health presented on TV networks a diagram, widely known to students of business logistics, representing a bell curve of the number of patients in acute respiratory distress that must absolutely remain below the capacity of hospital beds. In brief, a logistical resilience based on a rigorously controlled demand for care.

Accessing external resources

How can a food company like Coca-Cola cope with a sharp increase in sales of its soft drinks following an extreme heat wave, as was the case in France in the summer of 2003?

Beyond the appalling tragedy that France experienced (nearly 20,000 deaths in two months), supply systems were totally disrupted by an external shock of great intensity… which we did not know at the time foreshadowed recurrent heatwaves. Here again, a well-known logistical strategy can be used.

It relies on access to additional production resources from subcontractors, and additional storage and delivery resources from logistics service providers. This is only possible if the resources are available at the right time, in the right place and in the right quantity, and if the subcontractors and logistics service providers are responsive and flexible in providing them.

This logistical strategy of accessing external resources, traditional in the business world, was adopted during the health crisis. It is a perfect example of another form of logistical resilience. In concrete terms, the French authorities decided to use available hospital resources, including redeploying them when they did not correspond exactly to needs. For example, hospital beds for minor surgery were allocated to patients in acute respiratory distress, but in limited numbers given the emergency activities to be managed anyway. To capture external resources, two complementary options were chosen:

• The first option was to rely on private hospitals acting as logistics service providers on an ad hoc basis, and to convert resources available in saturated public hospitals in the Grand Est and Paris regions but allocated to other services. The initial capacity of 5,000 hospital beds was thus increased to 10,500 beds, more than enough to accommodate all patients, with a peak of 7,000 patients in acute respiratory distress reached at the beginning of April 2020.
• The second option consisted of organizing transfers of patients in respiratory distress between French regions as a matter of urgency, to unsaturated hospitals in the west of France and on the Atlantic coast, but also to hospitals in Austria, Germany, Luxembourg and Switzerland. To do this, a largely cobbled-together routing system was set up, using planes, ambulances, boats and commercial TGVs (high speed trains) re-equipped as quickly as possible to accommodate stretchers and heavy medical equipment.

Investing in new capacities

For a manufacturing or retailing company whose business activity is growing rapidly in its market, the temptation may be huge to acquire new logistical resources to meet the increasing demand (whether it be storage warehouses, handling equipment or transport equipment).

This is an option that has long been studied in management, which consists of investing in additional capacity. However, it must be admitted that many companies are reluctant to make an investment decision because they will have to face the relative irreversibility of the choice made, at least over a few years. Divestment may well prove difficult to organize in the presence of “sunk costs”, i.e., costs that cannot be eliminated in the event of the cessation of an activity, particularly when demand collapses following a reversal of the market trend.

In the spring of 2020, China invested massively in additional hospital capacity, with the emergency construction of 16 temporary accommodation hospitals in the Wuhan region, called “Fangcang shelter hospitals”. But China is an authoritarian economic and political regime for which the question of sunk costs does not arise in the same terms as in Western countries.

In France, the political authorities have decided to build a single military field hospital, operational on the site of the public hospital in Mulhouse, near Strasbourg, the epicenter of the pandemic’s spread zone. The hospital would be dismantled in mid-May 2020 after having received 47 patients in acute respiratory distress.

The investment in additional capacity can therefore be considered marginal, but it nevertheless corresponds to the manifestation of logistical resilience as described in academic work on the topic.

Tomorrow?

It is likely that the health crisis resulting from the Covid-19 pandemic will leave lasting traces in European health systems. Obviously, only historical hindsight will provide the opportunity to analyze in depth the implications of this external shock of unprecedented violence. However, it must be recognized that if the French hospital system has resisted well, it is certainly because the self-sacrifice of the health care staff has been combined with a genuine logistical resilience, based on three “winning strategies”, to use an expression widely used in management.

It remains to draw the necessary lessons from the experience, and this seems to be the case since in January 2021, patients in acute respiratory distress were once again efficiently transferred from the south of France to Brittany, due to the saturation of Mediterranean hospitals, including Nice and Marseille, following a new wave of contamination.

However, it is necessary to go further than a simple replication of the solutions implemented during the spring 2020, which are the result of a system “cobbled together” in the emergency.

The most important thing is to identify the achievements, but also the failures, in order to propose a coherent roadmap in case of a new major health or humanitarian crisis in the near future. From this point of view, coordination on a European scale seems essential, by mapping hospital capacities and available logistical resources on a continental scale, and not country by country.

More than ever, the watchword is: supply chain creativity. If this were not the case, and the organizational memory were to fade, we would have to reinvent the wheel again and again, wasting a lot of time and energy in order to reactivate logistical solutions that have already proven their effectiveness.

Gilles Paché is Professor of Marketing and Supply Chain Management at Aix-Marseille University, and Director of Research at the CERGAM Lab, in France. He has more than 500 publications on logistics management, large retailer strategies and the governance of soccer clubs in Europe. He can be reached at [email protected]

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