Clinical Supply Chain 101

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					     Clinical Supply Chain 101
                     or
“How do I get the stuff I need and want for
               patient care?”



                 Presented by
       Trisha Barrett, BSN, MBA, CIC
             UCSF Medical Center
       Clinical Opportunity Facilitator
          UCSF Materials Management
             Strategic Direction

!   Support Cost Reduction
    • Standardize to best clinically acceptable product - focus
      on patient and worker safety
    • Pay as little as possible and participate in committed
      programs
    • Control waste, loss, theft (utilization control)
!   Support Productive Partnerships with
    Manufacturers and Distributors
!   Promote and Support Automation for
    Medications and Supplies
               Challenge of Control

                            Manage Demand
                            •Match Product to Need
                              •Control utilization
Manage Suppliers              •Reduce variability
•Eliminate “back door”                                 Manage Transaction
      purchasing                                     •Purchasing policies and practices
•Maintain sound partner                                •Contract/Pricing Compliance
     relationships
                                                                •E-ordering


                           Manage Logistics
                     •Efficient delivery to users (automated
                             carts or supply rooms)
                       •Optimize inventory management
     Supply Safety and Security


!   Infection Control
    • Protect from dust, moisture, and
      exposure to elements
    • Preserve package integrity
    • Infection hazards
    • Security of sharps from theft or
      accident
    • Degrading of product - test strips left in
      heat
     Supply Safety and Security


!   Security of Supplies
    •   Sign in vendors
    •   Challenge strangers
    •   Prevent theft of supplies and equipment
    •   Prevent accidental injury or non-medical
        use of needles and syringes
                    Value Analysis Program
    UHC’s Value Analysis Program is structured to assist hospitals
                    to reduce costs and improve performance by:



!   Implementing effective and appropriate
    utilization/standardization of products,
    services, and processes
!   Implementing UHC clinical and operational
    benchmarking findings, technology
    assessments, etc.
!   Maximizing the use of UHC data bases
!   Managing change within member hospitals
         Definition of Terms


!   GPO - Group Purchasing Organization
!   Distributor - business partners to
    serve as our “warehouse”
    • now Allegiance (recently Owens & Minor)
      + others as needed
!   Vendor/Manufacturer/Supplier
     Health Care Supply Chain


                Drug Wholesalers
                Med Surg distributor
                Manufacturer Direct
Manufacturers                              Hospital
                Lab Supply Distribution
                Office Supply Wholesaler
                Food Wholesaler
                Film Distributor
                Other Suppliers
              GPO vs Independent
                 Contracting

           BEST VALUE
                            UCSF
                                         CLINICALLY DRIVEN
                            Model




GPO
      1 - 3 CONTRACTS   TELL HOSPITALS    LIMITED CHOICE
Worst to Best Pricing

       Single, Small Hospital

    Local, Voluntary Group

   Large Group Purchasing Org.

     Large Teaching Hospital

    Committed GPO Program

 Standardized and Committed IDN
     Novation Contract Benefits

!   Novation -
    • VHA and UHC combine group purchasing
      for 1700 hospitals
!   Four levels of benefit
    • Discount pricing item by item
    • Spectrum- possibility of savings up to six
      figures in fully committed program
    • Rebates if fully committed
    • PEC credits back to member
Example of Committed Program


Abbott Critical Care   Disposable Transducers

Abbott I.V.            I.V. Solutions & Pumps

BD Acute Care          Surgical scrub brushes, blades

BD Vacutainer          Vacutainer Needles, Blood
                       Collection Tubes.
BD Vascular Access     Angio Cath, I.V. Start Pak

Bard Urological        Drainage Bags, Urethral Trays,
                       Foley Cath Tray & Urine Meters
                    Driving Cost Reduction
                    Preference vs Savings

High                                   Preference
                                        Devices
 Preference




                                                  Capital
                      Medical                    Equipment
                      Supplies

                                      Services

Low
              Low          Potential Savings             High
                  Sample Standardization
                      Opportunities
                                                                            Ortho Implants Implantable
  High                                                                                     Defibrillators
                                                                                  Pacemakers


                                                                                            Sutures
Preference
 Clinical




                                                              Urologicals
                                                IOL


                                                            Vital Sign Monitors
                         Oximeters           Surgical Instruments Surgical Tables          IV Solutions

              Exam Gloves                                     X-Ray Film
                                                   Exam Lights
                                                                    Sharps Containers
                                                   Ortho Soft Goods
                                        Textiles                                          Syringes
                        Scrubs Soaps                  Med Carts      Mattresses
             BP Cuffs                           Wheelchairs
                      Walkers Crutches                       Gurneys
                              Computer Paper
             Antiseptic                        Can Liners Air Filters
             Products Plastics Copy Paper
   Low
             Low                        Potential Savings                                        High
     Barriers to Standardization

!   Time required to gather data and support change
!   Cost incurred to make product conversions
    • Education and training
    • Materiel Services systems changes
    • Buy out of existing product or contracts
!   Relationship with current vendors and “Back Door
    Purchasing”
!   Complexity of change
    • Simple stuff but lots of staff in large organization
    • Few people but highly technical change for some conversions
    • Complex product and lots of staff (safety devices)
        UCSF PRODUCT STANDARDIZATION
            PROCESS (Summary Version)

!   Complete New Product Request Form
!   Assign to Committee, assign Clinical Champion, and forward to
    Purchasing Director for assignment to buyer
!   Clinical Champion and Clinical Opportunity Facilitator (COF) identify
    clinical issues
!   Buyer Prepares Financial Impact
!   Committee Decision:
    •   Approve for clinical evaluation (coordinated by Clinical Champion, COF, and Buyer)
    •   Approve for immediate implementation and validation (coordinated by Clinical
        Champion, COF, and Buyer)
    •   Table - Need more information
    •   Not approved and requestor notified of Committee decision
!   Report status to PSOC (Product Standardization Oversight
    Committee)
       Product Conversion Process
                                Identify the
                                Opportunity
        2%     2%               Gather the Data
 30%                18%
                                Structure the
                          10%   Opportunity
                                Negotiate/Prelim.
                                Recommendation
                                Form Team

                                Clinical Acceptance

                                Final Negotiations
                          10%   Implementation
5%           20%    3%
                                Follow Up
           Gathering Data


             Internal
               Data
             Analysis
External                Willingness
Market                      To
Analysis                 Change-
                         Timing
            Financial
            Analysis
           Form Product Team


!   Chaired by a clinician
!   Equal representation from all involved
    clinical sites
!   Materiel Services support
!   Usually 8 to 12 members
!   Strict reporting requirements
!   Meet for a limited period of time
!   Publicize results system-wide
  Negotiate/Preliminary
    Recommendation

           Product
           Costs
                     Potential
                     Labor Costs/
                     Savings



                        Service
Value
                        Levels
Added
Services
  Clinical Acceptance



•Select a group of product users
•In-service participating units
•Create product evaluation forms
•Set appropriate evaluation length
•Ensure representative availability
•Summarize evaluation results
            Implementation


!   Ensure the appropriate level of staff
    awareness and education
!   Resolve distribution issues
!   Minimize the cost of conversion
!   Execute conversion in a timely manner
!   Determine product exchanges
          Follow-Up

  Monitor Product Acceptability
  and Contract Compliance Issues



Manage                      Monitor
             Materiel
Rebates      Services      Utilization



     Verify Financial Savings
         (Audit Results)
     UCSF Goals for Automation


!   Utilization control and fill rate
    management
    • Users who bypass control features
      defeat the flow of supplies to the unit
!   Control of loss and theft of product
!   Charge Capture
    • Even if no charge to patient, capture for
      expense report
    UCSF Supply Automation Plan


!   Convert Pyxis 1000 to 2000
!   Install automated scrub stations
!   Evaluate Pyxis supply carts in areas
    currently without automation for
    supplies
!   Take lessons learned there, and
    convert Omnicells to Pyxis supply
    carts
    We Need Motivated Project
     Team Members Who Will:

!   Provide critical thinking and clinical
    expertise
!   Lead through example
!   Remain enthusiastic about potential for
    improvement even when barriers exist
!   Remain operations and process-oriented
!   Be receptive to new ideas
!   Represent the views of colleagues