A Point of Use System Implementation

1
Moving Supply Chain Management to the Next Level
Supply Chain Performance Improvement

• A Point of Use System Implementation

Scan It and It Will Come
Don Mullins Director of Logistics
Management TriHealth Cincinnati, Ohio
Keith Ferguson Principal Premier Supply Chain
Performance Improvement Richmond, VA
2
Agenda

• Setting the stage
• Solution
• TriHealth overview
• Supply replenishment background
• Point of Use System
• Evaluation
• Implementation
• Communication
• Results
• Lessons learned
• Next steps

3
Setting the Stage - From BTS

• Point of use systems (POU) help us to know the
  who, what, when, and where regarding the use of
  supplies.
• It also moves demand closer to the action,
  thereby smoothing out replenishment cycles.
• The key is to assure that the value justifies the
  expense.
• Best practice Selective use of point of use
  supply management/ordering systems for products
• Compare the value via ROI of open versus closed
  systems
• Barriers
• Customer resistance to change and concern that
  systems will require additional time
• Inability to project/prove a reasonable ROI
• Enablers
• Train staff on the value of new systems.
• Use formula-based recommended par levels as basis
  for par level negotiation with customers.
• Work with vendor to develop ROI.
• Integration with ERP to provide charge and
  utilization capture.

4
Solution

• Board expectation Perpetual inventory
  management system
• Would have required additional FTEs
• May not have warranted the incremental effort
• A more practical solution A Point Of Use (POU)
  System is a real-time system that utilizes
  state-of-the-art, touch screen computing
  technology for inventory and revenue management.
• The system may be installed at each nursing
  station and at other supply areas throughout the
  hospital where patient charging takes place.
• Scanning any item generates a replenishment
  transaction.
• Eliminates the need for charge labels. Items are
  identified as patient chargeable within the
  application.
• Scanning a patient chargeable item generates a
  charge transaction.

5
Solution

• Benefits include
• Improved accuracy of patient charges
• More efficient supply replenishment
• Elimination of special orders
• Inventory reduction
• Improved nursing staff satisfaction.
• By streamlining the supply process and the
  patient charge system, the POU system will allow
  more nursing time for direct patient care.
• The number of steps in the supply replenishment
  process can be reduced from 37 to 5.

If you need a new process and dont install
it.you will pay for it without getting it.


Hunters and the Hunted
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Inventory Management Vision

• Expand MMs sphere of influence to manage more of
  the supply chain
• Expand Supply Techs role to include inventory
  management
• Use a blend of inventory management strategies
  based on product characteristics and vendor
  service/capabilities.
• Consignment, just-in-time, stockless, continuous
  replenishment, exchange carts, case carts, among
  others
• Deploy methods that have good inventory control
  practices but do not require daily physical
  inventories
• Data driven, updated par levels and appropriate
  stocking vs.. non-stock handling based upon
  usage, frequency of use, and agreed upon
  confidence intervals for satisfying end user needs

7
Inventory Management Vision

• Service oriented to address user material needs
• Every two to three days with a few stat
  deliveries
• Use of scanning point of use technology
• Higher logistics staff productivity through the
  use of technology (bar codes, point of use
  system, and a balance of customer service goals
  and cost)
• Exceed customer expectations

• Extend supply chain management further into the
  organization
• Streamline processes for ordering and stocking
  supplies on the nursing units
• Remove logistics functions from nursing
• Increase nurse satisfaction
• Increase nurse time with patient
• Streamline charging process to enhance revenue
  capture
• More effectively manage inventory

8
TriHealth - at a Glancea partnership of Bethesda
and Good Samaritan Hospitals
Good Samaritan Hospital

• Good Samaritan Hospital (534 Beds)
• Busiest hospital in Cincinnati market
• Highest market share in Womens services
• Level III Nursery
• Teaching
• OB, Anesthesia, Surgery residents, Faculty
  practice
• High volume
• Cardiology, Orthopedic implants, OB
• Bethesda North Hospital (273 Beds)
• Fastest growing hospital in the Cincinnati market
• Level III Trauma - 2nd busiest ED
• High volume
• Cardiology, Orthopedic implants, OB

Bethesda North Hospital
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TriHealth - at a Glance

• Revenue - 1.9 Billion
• Current annual supply spend - 157.2 Million
• Centralized purchasing through Lawson
• Decentralized logistics staff at each hospital
• M/S distributor already delivering in low unit of
  measure
• 125 point of use locations

10
Supply Management Problems

• Random Unit par levels dollar value was set at
  average of 8,000 yet actual inventory found
  to be 14,000
• Supplies are frequently missing
• Calls to Logistics for supplies continue to
  increase
• Transporters make frequent trips to the units
  with supplies
• Supply room and nurse servers contain unnecessary
  items
• Supplies are not always charged
• Supply management on the unit is taking time away
  from patient care
• PCAs spend too much time stocking supplies
• Current charging process is lengthy and
  cumbersome
• Nurses are unable to find supplies

11
Nurses Do Not Always Charge for Supplies

• There are potentially 37 steps to the current
  charging process
• If item is from B-level, a sticker is not on the
  item.
• The same item could come from OM or from
  B-level.
• Some items used are not on the charging screens
  in patient charge system
• Inventory is understated due to discrepancies in
  the hand held
• Counts and par levels.
• Items that are special order, may not have a
  charge number set up in the
• Items from vendors other than OM do not have
  stickers
• Charge sheets are not always accurate

12
Typical Supply Room Pre-Implementation
13
Process Before Implementation
14
Supplier Evaluations

• Supplier Presentations
• OmniCell
• Pyxis
• Par Excellence
• Owens Minor
• McKesson

• Initial Presentation Evaluators
• 61 Nursing Personnel
• 14 Perioperative Services
• 11 Nursing
• 10 Logistics
• 8 Cardiovascular
• 4 Information Services
• 3 Revenue management
• 2 Central Sterile
• 1 Performance Improvement
• 1 Purchasing

15
Project Structure
16
Core Team Members

• Director Logistics Management
• Manager Information Systems
• Director Internal Auditing
• Manager Bethesda North Logistics Management
• Education Specialist
• Clinical Revenue Specialist
• Clinical Revenue Specialist
• Logistics Technical Coordinator
• Communications Associate
• Manager Good Samaritan Logistics Management
• Director Nursing Operations Support
• Director Revenue Management
• Supervisor Logistics Management
• Performance Improvement Consultant

17
Point of Use Implementation Gantt Chart
18
Supply Charge Process

• Before POU

• Redesigned Supply Charge Process with POU

19
Typical Supply Room Post-Implementation
20
Communication Plan
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Implementation Communication

• The Point of Use System Post-Implementation Audit
  is scheduled to begin Monday, November 14, 2005.
• We anticipate that the audit will last
  approximately four weeks. We will communicate any
  significant findings to you during the course of
  the audit.
• At the end of the audit, we will schedule a
  meeting with you to discuss all issues noted.
  Subsequent to this meeting, we will issue a draft
  report to you with management action plans
  suggested by you and/or your staff during the
  course of the audit. The final report will
  include your action plans.
• The objectives of the audit are to assess the
  internal controls of the Point of Use Supply
  Inventory System as they relate to system
  documentation, user access, data integrity, and
  post go-live functionality.
• The scope of the work planned to achieve the
  above objectives includes the following
  activities
• Review of the vendor contract.
• Review project implementation management
  procedures, including post-implementation
  assessment plans.
• Review general controls over system
  documentation, user access and data interface
  programs.
• Observe system operations in a sample of user
  departments.
• Assess adequacy of charge capture reconciliation
  procedures.
• Assess adequacy of management reporting
  capabilities.
• At the conclusion of the audit, you will receive
  a brief customer satisfaction survey which will
  help us to continuously improve the service we
  provide.

22
Inventory Reduction

• Example of inventory that was removed from one
  unit as inventory, min/max levels, and par levels
  were adjusted prior to go live with POU
• Overall inventory reduction totaled 54,025
• Some units actually were increased

Overlaying new technology on a bad process and
poor workflow is like shrink wrapping a cactus.
Jim
Peters, Leap Technologies
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Point of Use Weekly Schedule
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Bethesda North Go Live Schedule
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Training Education Agenda

• What is Point of Use system Benefits?
• How to Use POU
• Par Carts
• Process Changes
• What to Charge vs. Not Charge
• How to Charge Procedures
• How to Charge Supplies
• Floor Stock vs. Patient Charges
• Downtime Procedures
• QA Sheet
• How to Credit Supplies
• How to Charge I.V.Solutions
• How to Look up Patients or Items
• Patients Not Assigned to a Room

26
Communication - Article for Physicians Bulletin
27
Communication - Article for MOX Mail

• Bethesda North
• Dates Locations
• Sept. 11 MSICU/ICU CCU/CVRU CCU CVRU PACU
  Radiology Endoscopy
• Sept. 18 Nursery Mother/Baby Unit Labor
  Delivery Spec. Care Nursery ATC Radiation
  Cancer Center
• Sept. 25 1st Floor Med/Surg SDS 5th Floor
  Med/Surg 6th Floor Med/Surg
• Oct. 2 4th Floor Med/Surg Dialysis room, 4th
  Floor Gr. Rehab Ground Med/Surg Telemetry
• Oct. 16 ED Respiratory Therapy 1st Floor
  Respiratory Therapy 4th Floor
• Good Samaritan
• Dates Locations
• Oct. 16 11AB 11CD CCU Geriatric Psych 10FG
  Acute Psych 10HI 12AB 12D Neuro ICU
  Respiratory Therapy Logistics
• Oct. 23 13 Mother/Baby Unit Clean Hold 13AB
  13CD Nursery 14AB 14CD 14PD Solution Room
  15AB Seton Center
• Oct. 30 9HI Labor Delivery L D Triage
  Newborn ICU Newborn ICU NICU Card. Surg. Unit
  Utility NICU Card. Surg. Unit Recovery MSICU
  Clean Hold and Respiratory
• Nov. 6 Breast Center FMC Clinic Endoscopy
  Surgicare Clean Hold and Hall Closet Dialysis
  8E Short Stay 8AB Inpatient Rehab Eye
  Center/Sleep Center
• Nov. 13 ED Acute Closet and Fast Track Clifton
  Closet PACU Recovery Radiation Oncology
  Outpatient Cancer Care ASC Recovery

• If You Scan It, It Will Come Point Of Use
  System
• Point Of Use (POU), the real-time system that
  utilizes state-of-the-art, touch screen computing
  technology and inventory management software, has
  been installed in supply areas and other
  strategic locations throughout Bethesda North and
  Good Samaritan hospitals and implementation will
  begin on Sunday, Sept. 11 at Bethesda North and
  Sunday, Oct. 16 at Good Samaritan.
• With POU, nurses can simply touch a screen where
  the patients name appears and then scan the
  supply being dispensed, reducing the process to
  charge patients from 37-steps to just five steps.
  Also, POU will help to increase accuracy of
  patient charges, ensure accuracy in supply
  replenishment, eliminate special orders, reduce
  inventory and improve nursing staff satisfaction.
  By streamlining the supply process and the
  patient charge system, the new system will allow
  nurses more time to focus on patient care. We
  are very excited about this new system and are
  confident that TriHealth will benefit from what
  it has to offer, says Don Mullins, director of
  Logistics Management.
• POU implementation dates and locations for
  Bethesda North and Good Samaritan hospitals are
  as follows

28
Communication - Article for Bulletin

• If You Scan It, It Will Come Point Of Use
  System
• Point Of Use (POU), the real-time system that
  utilizes state-of-the-art, touch screen computing
  technology and inventory management software, has
  been installed in supply areas and other
  strategic locations throughout Bethesda North and
  Good Samaritan hospitals and implementation will
  begin on Sunday, Sept. 11 at Bethesda North and
  Sunday, Oct. 16 at Good Samaritan.
• With POU, nurses can simply touch a screen where
  the patients name appears and then scan the
  supply being dispensed, reducing the process to
  charge patients from 37-steps to just five steps.
  Also, POU will help to increase accuracy of
  patient charges, ensure accuracy in supply
  replenishment, eliminate special orders, reduce
  inventory and improve nursing staff satisfaction.
  By streamlining the supply process and the
  patient charge system, the new system will allow
  nurses more time to focus on patient care. We
  are very excited about this new system and are
  confident that TriHealth will benefit from what
  it has to offer, says Don Mullins, director of
  Logistics Management.
• POU implementation dates and locations for
  Bethesda North and Good Samaritan hospitals are
  as follows

29
Communication

• To replace a part affecting the memory on the
  server.
• POINT OF USE WILL BE DOWN
• FROM
• 3PM TO 4PM THURSDAY, THE 2ND.
• DURING THIS TIME,
• ALL SUPPLIES TAKEN FROM SUPPLY ROOMS MUST BE
  WRITTEN DOWN ON A SHEET THAT WILL BE PROVIDED.
• THANK YOU!!!

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Typical Supply Room Post Implementation
31
POU Project Financial Summary
32
Results

• Other Increases in Productivity
• Time reduced by Nursing to look for supplies
• Less time spent looking for supplies due to
  organized bins
• Less time spent by Logistics performing manual
  inventory counts, ordering supplies, processing
  special order items
• Fewer calls to Logistics requesting missing
  supplies be brought to the nursing units

33
Daily Audit Reports

• User transaction report
• Patient charge audit report
• Discrepancies by Par and Date range

34
Performance Metrics

• Chargeable supply revenue/cost comparison
• United Audit Service
• Target was 85,630
• Actual FY 06 date through February, then
  annualized
• 57,000 decrease between FY 05 FY 06
• Does not include opportunities remaining by
  non-utilization by RT

35
Performance Metrics

• Calls for supplies dropped after POU was
  implemented

36
Lessons Learned

• Implementation considerations
• Planning for construction, installation of new
  bins, installation of new data drops, new
  electric drops prior to go live.
• Pulling out supplies, set up new bins,
  replenished supplies based on new min/max levels
  on a 3rd shift or weekend.
• Constructed a mock up wall in Logistics at one
  facility and a clean hold room at the other
  facility to model the space required for supplies
  and to give nursing a change to critique the set
  up and provide feedback and suggestions such as
  which supplies should be at eye level, easy to
  reach, etc.
• Endeavor to make units similar across the
  facility.

37
Lessons Learned

• Discuss issues after go live with team. Do not
  attempt to fix or alter processes without
  involving the entire team.
• Make sure process changes are communicated to
  core team
• Standardize processes as much as possible due to
  the need for continuing maintenance
• Discussions about processes should be done at the
  staff or Unit Charge Clerk level, not with only
  the Managers who are not exactly clear on details
  of processes
• Super users in units need detailed training like
  Logistics staff before go-live, so issues can be
  fixed before implementation, not during
• Managers need to be better educated and
  communicate process changes to staff
• Consult with Nursing about proposed go live dates
  before setting
• Go live with 2 units per day verses 10 per week
  (2 Mon, 2 Tuesday, etc)
• Have Revenue Management staff on each unit for
  go-live
• POU Administrator works with managers daily re
  revenue audits and compliance

38
Lessons Learned

• Better understand what Lawson drives verses
  Omnicell overrides Identify and allow time to
  build special order items on par carts
• Security badges should all be issued before
  go-live
• Build additional units, hours and interfaces into
  budget
• Color coded bins
• Nursing/Logistics organized supplies into color
  coded bins as follows
• Yellow bins Urologic/gastro intestinal
• Blue bins Respiratory, orthopedic (varies by
  floor)
• Gray bins Personal care items
• Red bins Blood draws, dressings, IVs

39
Customer Quotes

• Good Samaritan Nursing
• This is so much easier for the nurses
• The old way left too many chances for failure
• I like being able to pull up all activity on a
  patient

• Bethesda North Nursing
• I hear nothing but good comments from staff
• This is so much easier than the old way
• Our charge compliance has gone way up
• We like it so much that we want to standardize
  the rest of the units

40
Next Steps

• Audits In Place To Monitor Revenue Usage
  Compliance
• Individual Follow Up With Unit Managers
• Revise Par Levels As Needed
• Additional Units May be installed
• Complete Transfer of Special Order Items to
  Logistics

41
Questions