Our organization needed a way to better manage materials in the nursing units' supply closets. According to Materials Management in Health Care magazine (April 2010), a hospital's inventory system can account for 40% of their total operating budget. Implementing an inventory control system properly can positively influence a hospital's bottom line by streamlining processes; capturing correct patient charges; keeping lower inventories on the nursing units and prevent oversupplying; and keeping adequate storeroom supply on hand.
IT Case Study Contest nominee: Union Hospital, Terre Haute, Ind., materials management initiative
We wanted a system that was tightly integrated with nursing workflow to ensure its ease and convenience of use to nurses. In addition, we needed to eliminate the manual processing and entry of patient-chargeable items. The process of creating and entering a patient charge was cumbersome to the nurses and had multiple failure points.
Finally, we needed to streamline the inventory counting and restocking process for medical supplies and linens.
To meet these needs, we partnered with a software development company to help us design the Par Inventory Management System (PIMS) to look and function very similar to our current nursing documentation and bed management systems. PIMS is accessed through a touch-screen monitor mounted on the wall in each supply closet. Staff can effortlessly pick the patient from a list on the touch-screen monitor, scan the items to be taken from the closet with a wireless barcode scanner, state the quantity of the items taken, and then press “submit” on the monitor.
The usage data from the scanned items flows directly to the materials management procurement application. This data is processed hourly to the main procurement system to decrement the inventory, thus allowing for the delivery of replenishment supplies to each unit's supply closet at specific times throughout the day. This process eliminates the need for nursing staff to make phone calls to materials management department when running out of supply items, saving nursing time and resources. The process also eliminates the need for materials management and laundry staff to make multiple trips to the supply closets to manually count the inventory.
PIMS is a crosswalk between inventory and information within the hospital; data is interfaced bi-directionally from PIMS.
First, patient registration data is interfaced into PIMS. This allows the clinical staff to effortlessly choose the patient for whom the items will be used from a list on the touch screen monitor.
This usage data is then interfaced into the materials management procurement application, which decrements the supplies on hand. PIMS provides real-time reports to the materials management and laundry departments regarding inventory counts, which in turn allows distribution of supplies in a more efficient and cost-effective manner.
The data is also interfaced to the financial/billing application, which then lists the supplies on the individual patient's bill and charges for them in accordance with law.
Touch-screen monitors and hand-held, wireless scanners are used to make this system as user-friendly and efficient to staff as possible. Both of these types of devices were already in use for other clinical systems throughout the organization, which eliminated the need for education and additional stressors to staff.
We implemented PIMS in conjunction with the opening of our new 500,000-square-foot inpatient tower. In anticipation of the streamlining and efficiencies this system would bring, we did not add any new FTEs in our materials management department, and we have been successful with maintaining our original staff numbers for over one year. Materials management also changed its deliveries from their main distributor from five days per week to three days per week. This change lowered the cost associated with supplies while still maintaining adequate supply levels for the nursing units.
Prior to implementing PIMS, our laundry department used a cart exchange system for linens on the nursing units— meaning a fully loaded linen cart would be pushed to each nursing unit and exchanged for the used linen cart, which was brought back to the laundry department and restocked appropriately. This process utilized many man hours with deliveries to eighteen nursing locations, twice daily. With the implementation of scanning the linen usage through the PIMS, laundry staff is now able to replenish used linens to all nursing units with one rounding delivery. Thus, we opened our 500,000-square-foot building without purchasing any new linen exchange carts or increasing FTEs. And laundry is 40% under budget on replacement linen for this fiscal year.
Once an item is scanned out of the supply closet, charges are automatically generated to the patient's account, eliminating the need for nursing staff to manually enter charges for specific items. During the first quarter of PIMS usage, we were able to show greater than $340,000 increase in supply charges captured. After one year since implementation, we have a $1 million increase in charges, which would have previously been lost revenue to our organization.
Due to the success of this technology implementation after approximately 6 months of use at our rural hospital, we implemented the system in our critical access hospital. We were also able to implement PIMS there with no additional FTEs hired.
PIMS is eligible for funding from the American Recovery and Reinvestment Act of 2009 due to our clinical staff efficiencies gained, promoting quality patient care.
Kym Pfrank is vice president and chief information officer at Union Hospital in Terre Haute, Ind.
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