Last year, around this time, I was completing a Capstone project for the U.S. Food and Drug Administration (FDA) on whether manufacturers considered how hospitals would use unique device identifiers (UDIs) when forming their approach to compliance with the FDA’s UDI rule. As part of the research, I found a striking difference between those manufacturers who engaged with customers and those who did not. Those who reached out to customers were twice as likely to see opportunities to derive value from the investment required to comply with the regulation and, as such, went beyond doing only what was required.
What is it that compels an organization — whether supplier or provider — to do more than is required or is funded, especially in a highly regulated industry like healthcare? This is a question I hear asked increasingly in both North America and Europe.
For example, at two conferences in the United Kingdom in late 2017, people wondered: If the Department of Health’s Scan4Safety program is so successful (see March 2017 issue of Standard Practices), why hasn’t it expanded beyond the six original demonstration sites? Those organizations were given seed funding for the program, and the Department of Health has said it would like to expand the program to 24 more sites. But so far, there has been no money allocated for the expansion. At the GS1 UK annual conference, Bob Alexander, deputy chief executive for NHS improvement, said the annualized savings at the demonstration sites is £420 million, far more than the original investment, adding that the question should not be “Should we expand the program?” but rather “Why aren’t we?” While some other NHS trusts have begun utilizing GS1 standards for various activities and with good results, none have yet tried to replicate the Scan4Safety program.”
Contrast that with the experience of St. James’s Hospital in Dublin. John Cotter, the hospital’s Programme Director, Activity Based Funding, said they launched their Scan for Surgery program without any government funding, and without any regrets. The initiative, which scans barcodes for all products used in the operating room, paid for itself in just one year.
Getting to this point took a lot of due diligence to create a solid business case, a qualified staff and robust technology, strong clinical engagement, and a culture of innovation. As is true in other parts of the world, healthcare providers in Ireland have been under increasing financial constraints, especially since the financial crash of 2008, and need to find ways to improve the efficiency, quality and cost-effectiveness of care delivery. To achieve these objectives, St. James’s Hospital wanted a better understanding of what products were being used in its operating theatres and the associated costs at the procedure level.
They achieved this through point of use scanning of GS1 barcodes. Today, St. James’s can track 89 percent of cost direct to the patient and has significantly reduced time spent on supply chain activities. In the event of a product recall, St. James’s can also more easily trace the impacted products to the patients on which they were used, a critical patient safety improvement factor. Director of Facilities Management Vincent Callahan adds, “Taking a holistic approach to implementing GS1 standards hospital-wide, with a view to increasing both patient safety and operational efficiency, is a key strategic objective for St. James’s Hospital.”
St. James’s also tracks the time spent by those involved in patient care using a touch screen that is part of its operating theatre management system. Tracking both supply costs and labor has enabled Cotter and the team to be able to more fully analyze costs per procedure and by patient and physician among other variables. But this is more than a cost accounting exercise. Cotter says while hospitals can achieve short term return on investment from things like inventory savings, the real benefits will come from data that helps standardize clinical practice based on what has been proven to work best. Manufacturers will be able to design new products and make enhancements to existing ones by using data linking clinical product efficacy to patient outcomes and complications data. St. James’s has made the investment in capturing product identifiers at the point of use. As manufacturers label more of their products with unique device identifiers (coming as a result of the European version of the UDI rule) and more hospitals adopt similar scanning technology, Cotter and Callahan look forward to a robust data ecosystem that can help drive better decisions by providers and suppliers, improve patient safety, and lower costs for all involved.
Karen Conway | CEO, Value Works
Karen Conway, CEO, ValueWorks
Karen Conway applies her knowledge of supply chain operations and systems thinking to align data and processes to improve health outcomes and the performance of organizations upon which an effective healthcare system depends. After retiring in 2024 from GHX, where she served as Vice President of Healthcare Value, Conway established ValueWorks to advance the role of supply chain to achieve a value-based healthcare system that optimizes the cost and quality of care, while improving both equity and sustainability in care delivery. Conway is former national chair of AHRMM, the supply chain association for the American Hospital Association, and an honorary member of the Health Care Supplies Association in the UK.