Introducing the First Healthcare Provider Recall Cost Recovery Matrix
Healthcare Provider Recall Cost Recovery Matrix
Recalls are an unavoidable reality in healthcare – but until now, there has not been a consistent way to recover the significant costs that providers incur when managing them.
Every recall requires time and resources: researching and validating the item was purchased and is in inventory supply chain teams pulling products from shelves, clinical staff consulted for guidance, compliance and patient communications, and often executive oversight to ensure patient safety. These efforts can consume dozens of staff hours and carry significant expense. Yet historically, most of these costs have gone unrecovered.
For suppliers, this lack of structure has also created uncertainty. With no industry benchmark, every cost recovery discussion feels different – and often contentious.
It’s time for a change.
Why an Industry Standard Matters
Creating a recall cost recovery matrix establishes:
Transparency: a clear baseline for what managing recalls truly costs.
Consistency: a common framework and baseline that providers can rely on, and suppliers can expect.
Fairness: shifts the conversation from one-off disputes to an industry standard.
This isn’t just about recovering dollars. It’s about recognizing the operational burden recalls create, and building a path toward a fair, predictable processes.
How the Matrix Was Developed
Over the past several months, nearly 20 health system supply chain leaders and Optima Supply Partners joined together in an effort to tackle this challenge. Through a series of workshops and focus groups, we:
Defined the core cost categories involved in recalls.
Distinguished between standard costs (always present, such as full-time recall staff and software) and variable costs (applied as needed, such as additional resources and/or time required to assist in managing the recall).
Aligned on the two key drivers of recall impact: scope (number of beds/facilities affected) and complexity (level of operational and clinical involvement required).
Built a tiered matrix assigning baseline dollar amounts to different combinations of scope and complexity.
The result is a practical tool that both providers and suppliers can use to anchor conversations around recall cost recovery.
What the Matrix Looks Like
The matrix is structured as a simple grid:
X-Axis: Scope of Impact (number of beds/facilities affected)
Y-Axis: Recall Complexity (low, medium, high – based on the operational and clinical effort required)
Each cell of the matrix establishes a baseline standard cost for a recall in that category. This provides a starting point for cost recovery that is consistent, defensible, and transparent.
Additional variable costs (e.g., patient notification, special disposal needs, weekend work) can be applied as add-ons when appropriate.
This version represents a baseline standard that can be adopted now and refined over time as the industry gains more experience.
Next Steps
With the support of participating health systems, the Recall Cost Recovery Matrix is now being published as an open resource.
Providers: we encourage you to begin incorporating the matrix into your recall management and recovery processes.
Suppliers: this framework creates greater predictability and fairness in cost recovery discussions.
Industry Stakeholders: we invite you to review, share feedback, and contribute to future updates.
The matrix is a starting point, not an endpoint. As adoption grows and more data becomes available, we will refine the framework and publish updated versions.