Medical technology tends to drive up the cost of healthcare. So administrators at one California hospital were pleasantly surprised to find that a new surgical supply system virtually paid for itself the day it went on line.
Those savings, say managers at the new San Joaquin General Hospital near Stockton, are only the beginning. They foresee future benefits from standardization of supplies, just-in-time inventory practices, lower salaries and, eventually, more efficient use of operating suites and personnel.
"From where we've been to now, it's absolutely exciting," said unit clerk Maria Zendejas, as she showed how a surgeon's preference list is assembled on a computer screen.
San Joaquin's new system consists of two software products, Orbit and Nova, created by Enterprise Systems (ESI) of Wheeling, Ill. Orbit governs surgical processes and scheduling; Nova handles materials management and inventory. ESI has sold several hundred copies of the programs.
The software is combined with a case-cart system for assembling surgical supplies and tools. In San Joaquin's old building, supplies were kept in the surgical department and cases were prepared basically by hand. Now the process has been moved off-site and effectively automated.
When administrators planned the replacement hospital, which opened in March, they designed a sterile processing department in the basement. Surgical supplies and tools are kept there, and technicians assemble a cart to order for each scheduled surgery.
The completed cart is rolled into a special sterile elevator and taken on a sterile path to the second-floor operating suite. Once the procedure is complete, the used surgical tools are placed back on the cart, and it goes back to the basement in a "dirty" elevator to the decontamination room. The implements are sterilized and the process starts again.
The whole sequence is organized by computer. "The system is what allows us to do the case carts," said Marge Obernuefemann, manager of San Joaquin's operating room. "You have to have a list to know what to put on the case cart. That comes out of our ESI program."
Systems such as that used at San Joaquin exemplify the dramatic productivity gains that can be realized through integration of computer software in complex work processes. A number of variants of the product are on the market, including systems made by HBO & Co., Medaphis and TSI International Software Ltd., but according to ESI, none fully integrates the scheduling and materials management as Orbit and Nova do.
In the old days, surgeons' preference lists of what tools and supplies they needed for a given procedure were kept on index cards and updated by hand. For a year before San Joaquin moved into its new building, a nurse typed all the preference data into a computer. Now the computer holds about 1,000 preference lists for different doctors.
Surgeon Glynn Garland, for example, has 61 items on his preference list for a total hip replacement. A printout Zendejas made lists not only all the drapes, packs, instruments, dressings, supplies and medications Garland needs, but also describes how the doctor wants the operating room set up.
A ticket automatically charges the list of items to the patient's case.
When Garland schedules a procedure, it is entered into the computer, which signals technicians in the basement when it is time to assemble the case cart for that surgery.
The technicians also can access a video display of how the surgeon wants the finished case cart to look, with all the instruments arrayed in order.
Obernuefemann said the greatest benefit for the operating room nurses is knowing whatever has been ordered will come up. "When you have the same people working off lists that are predecided, the nurse can expect a consistent cart," she said.
The next best thing is finally having the means to work with doctors on standardizing tools and supplies. "Because we have the lists on a computer," Obernuefemann said, "I can sit down and say to the surgeons, `These are all the tools we are using on a (laparoscopic cholecystectomy). How can we standardize this?' If you have five surgeons each doing a laparoscopic cholecystectomy, it's more efficient if they are all using the same equipment and supplies."
That, said hospital Administrator Steven P. Ebert, is the whole idea. "For every procedure, if there are 10 different physicians who do it, you could have 10 different recipes. One of our goals is to have all 10 of them standardize on tools used to do the procedure," he said.
"Dr. X does this procedure and it costs $300. Dr. Y does this procedure and it costs $600. How come? Why not settle on this recipe? It costs $325, and everybody will be happy," Ebert said.
Over time, standardizing procedures is going to lead to the big savings in hospital costs, Ebert thinks. And once the variations are cut down, the hospital should be able to negotiate better contracts with vendors.
But in the meantime, there are other budget trimmings. For one thing, instead of having registered nurses and surgical technicians reprocessing the equipment, sterile-processing technicians do it. Their wage scale is lower, and they concentrate on that one task, lending consistency to the product. Further, the hospital is using the computer scheduling program to achieve maximum utilization of operating rooms and staff, "so we don't do 20 cases one day and five the next," Ebert said.
Also, the computer won't let the same piece of equipment be scheduled for the same time in two different procedures. "You are decreasing delays and decreasing cancellations of events," said Connie Moser, vice president of resource scheduling systems at ESI. "It allows (technicians) to forecast and manage for that day of activity. It gives them a lot of control."
The system has a historical database that tells it how fast supplies are likely to be used up, and it automatically reorders from vendors depending on the volume and kinds of surgeries being scheduled.
The computer's accurate cost accounting is a godsend to hospital managers, who sharpen their pencils daily trying to figure out how much hospital services really cost. In fee-for-service cases, the system generates a bill. But as Medicaid capitation becomes the means of reimbursement for more and more of San Joaquin's patients, such information management tools are essential.
Ebert estimates his hospital spent $200,000 to $250,000 for the computers, software and wiring. In the old days it was carrying between $400,000 and $500,000 of inventory in the surgery department, "without any control over how often it turned over," he said.
When they moved into the new building, inventory was reduced by half, Ebert said. "A onetime inventory reduction alone was probably equal to the basic cost of installing the system."