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MEDSTAR HEALTH. MedStar Health is a $2.9 billion non-profit healthcare organization and a community-based network of seven hospitals and other healthcare services in the Baltimore-Washington region. As the area's largest health system, it is one of its largest employers, with more than 24,000 employ

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2. MEDSTAR HEALTH MedStar Health is a $2.9 billion non-profit healthcare organization and a community-based network of seven hospitals and other healthcare services in the Baltimore-Washington region. As the area's largest health system, it is one of its largest employers, with more than 24,000 employees and 4,600 affiliated physicians, all of whom support MedStar Health's patient-first philosophy that combines care, compassion and clinical excellence with an emphasis on customer service. We prove this everyday with over 145,000 inpatient admissions and more than one million outpatient visits each year.

3. SAFETY AND SECURITY MedStar is constantly in the process of identifying safety risks to patients and staff Sales and service representatives have access to all areas of the hospital even restricted areas such as OR and Cath Lab Little documentation on criminal history, health or certification. Unapproved selling

4. FACTORS TO CONSIDER Large system- easy to maintain Hospitals and off site locations Over 130 operating rooms 35 cardiac cath labs 350,000 emergency room visits HIPPA compliance Unauthorized selling of products Unannounced visits to doctors offices and departments

5. STEPS TO IMPLEMENT PROGRAM Define the needs of the organization Identify the method and resources needed to start a vendor program Decision to insource or outsource the program Notify vendors Communication to MedStar Assessment of program

6. RESEARCH Other systems have the same issues—do they have a solution? Sentara shared their information AORN (Association of perioperative nurses) Position statement Review of internal policies and procedures Resources

7. DECISIONS New system-wide policy to bring continuity to the program Input for this policy was received from all business units Who will collect the data, create badges, monitor access Materials Management and Security departments will be tasked with this program Set start date

8. PROCESSING Data collection Difficulty in obtaining vendor names and contact information Letters to vendors and Materials Management assistance CD created with all requirements Email and voicemail Outsourced the data collection and processing of badges

9. SECURITY LEVELS Different levels of access needed Patient care areas differ from Pharmacy All representatives must have a photo ID badge Daily badge will be provided to vendors who visit less than twice a year All vendors are required to have an appointment and sign in and out Any products brought into the hospital without Value Analysis approval will be considered gifts

10. BADGE REQUIREMENTS Criminal background check Drug test Confidentially statement Education or certification on products Appointment required Immunization required for restricted areas Business code of conduct

11. IMPLEMENTATION Letters and CD sent to vendors Collection of documentation, notification of missing items and creation of badge was outsourced Badges were distributed by Corporate Materials Management department No fees for initial badge Late fee if not completed by deadline Replacement badge fee

12. IMPLEMENTATION Key component was to have hospital and system administration enforce the program Vendor leadership involved in violations Penalty for vendors that don’t comply Vendor restricted for 30 days Initially only 800 of estimated 2500 vendors were notified CD’s are distributed only by request through email

13. LESSONS LEARNED Voicemail was not an acceptable method of communication Due to the size of this project a full time manager was needed Labor intensive badge distribution Communication and participation by all is paramount to a successful program

14. Evaluating & Selecting Supply Chain Management Technology Applications AHRMM HIMSS ANNUAL TECHNOLOGY SYMPOSIUM February 25, 2007 New Orleans, LA Presented by Carl Natenstedt, Vice President Technology Solutions & Jamie Kowalski, Managing Director, Business Development Owens + Minor- Richmond, VA

15. Program Objectives Attendees will be able to: Define Technology’s Role in Successful Supply Chain Management Strategies Explore Two New Technology Areas and How They Contribute to Supply Chain Excellence Explore Techniques for Selling the Technology Solution to Management

16. What is Being Managed? The Enterprise-Wide Supply Chain

17. Supply Chain Management Strategies Restructure Reengineer Processes Maximize Customer Satisfaction Optimize Resource Productivity Minimize Operations & Supply Expense Be an Efficient Customer Accountability with Those in Control Use Metrics to Manage Match Technology to Strategy

18. Technology Applications for Supply Chain Management Automation Point of Use Dispensers Bar Code Scanners RFID Automated Guided Vehicles (and other automated bulk transport) Pneumatic Tube Systems (PTS) Robots Automated Storage Retrieval Systems/Carousels

19. Technology Applications (cont’d) Knowledge Management Total Spend Data/Catalog Management MMIS; Requisition through Payables E-Commerce, EDI Asset Tracking & Management (inventory of equipment, consumables, implants) Instrument Management

20. Information Technology Enables Optimization

21. Technology Enables Supply Chain Optimization OPERATIONS LEVEL Automate, Standardize Processes Replace Labor Enhance Labor Productivity Enhance Quality Consistency Increase Processing Speed, Accuracy Reduce Operating Expense Capture Data, Convert to Information

22. Source: Supply Chain Summit- Canada Sept. 05 ECommerce Automates the Transactional Supply Chain

23. Supply Chain Management Strategies Distribution Ordering, Receiving, Paying Filling orders Tracking inventory Tracking arrivals, deliveries Fill Rates Point –of-use to Source Freight expense Cost per line filled, delivered Accuracy Productivity Scheduling

24. Technology Enables Strategy STRATEGIC LEVEL Provide Comprehensive and Consistent Visibility of all Supply Chain Components Transform Information/Data into Knowledge Leads to Strategy Development and Action Optimize Performance Position Technology as part of Strategy; not THE Strategy… a Tool, Enabler

25. Technology Tackles New Areas Spend Management / Contract Management Clinical Inventory / Utilization Management Performance Management

26. Spend Management Spend Visibility - How can this be stratified, analyzed? Who? What? How much? With whom? Reduce Product Pricing Utilization of corporate contracts, tiers Assessment/reduction of value add costs Utilization of bids, negotiation Price standardization, compliance Standardize products Increase budgetary accountability at user level Control utilization Value Analysis: item selection, standardization Supplier Standardization

27. Contract Management Contract Coverage - What percentage of spend dollars in a product category are covered by contracts? Contract Compliance – What percentage of my “covered” spend is “on contract”? Contract / Transaction Accuracy – Are we on the right tier? Did we get the contracted price 100% of the time?

29. Technology Enables the Strategy Performance Management Capture and Display Metrics; Consistent, Accurate, Timely Recognize Trends Stratify in Variety of Ways Avoid “One Indicator” Syndrome Don’t Measure it, Can’t Manage it Understand, Communicate, Educate, Motivate Take action, reward

30. Example - Performance Dashboards

31. Clinical Inventory / Utilization Management Inventory Management Define, Identify Inventory What? Where? How Much? Consignment vs Owned Perpetual vs Periodic Increase inventory turns PAR levels or EOQ Link with Distribution – Restock Frequency Units of Measure Matching SKU Allocation Utilization Management Activity Based Costs; Procedure Costs Comparison between physicians Connection with outcomes: LOS, readmits

32. Real Time Utilization Data

33. Key Benefits - Hospital Enables visibility Lets departments run “leaner” Saves time and increases productivity Minimizes stock outs and product spoilage Saves space Improves charge capture Can improve safety, patient care (QA) Gives vendors insights to improve service

34. Key Benefits - Hospital Links contracting to utilization directly, real time Extends supply chain portfolio visibility, control Enables real time, constant data analysis Utilization Stocking Vendor services, consignment tracking Contracting Opportunity to involve vendors in improving inventory practices, contracting terms, commitments, rebates

35. Technology Applications Evaluation Process Assess Supply Chain Strategic Operations Plan Fit Operations Reengineering, Optimization Opportunities, Needs, Gaps Assess Technology Applications Redundancies Impact; Operations, ROI Build the Business Case

36. Business Case for Technology Investment Current State Future State; What’s out there, needed Goals, Objectives, Outcomes Integration Organization and Supply Chain Strategy Impact Investments and ROI

37. ROI CALCULATION Current Process Costs, Outcomes Modeled Process Costs, Outcomes Cost of Investment, Operations Financial Results Operating Expense Reduction Simple PayBack Net Present Value Return on Invested Capital

38. Selling the Technology Convince yourself first, commit and show passion, confidence Start small, think big Start with the Supply Chain Vision/Future State; How Technology Fits, Enables the Outcomes Position Technology as part of Strategy; not THE Strategy… a Tool, Enabler

39. Selling the Technology Selecting With Whom to Start stakeholders, executive champion, CIO? Educate; What’s in it for the Enterprise; for the Supply Chain Tell the Story How to Engage and Support Plan

40. Selling the Technology Link Technology to Operations and Outcomes, Results, Benefits Be Conservative, yet Compelling Demonstrate the ROI Fund the investment with Savings Achieved

41. Technology Implementation The “Whole Elephant”? Timing Sequencing Funding – “Savings are the Source” Tracking Results Following the Plan – Keeping Options Open Communicate Results/Outcomes

42. Questions, Discussion Conclusion

43. Measuring Variability Within a DRG

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