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Medical Device Management

Five strategies for hospitals to take the lead

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Medical device management is under keen scrutiny by hospital executives and their supply chain managers, and for good reason. Implantable medical devices are among the most expensive materials used in patient care. Yet, the limitations of how hospitals manage these expensive and often life-saving devices costs hospitals and suppliers up to $5 billion every year in lost and wasted products.

As hospitals prepare to meet the demands of new reimbursement models, they are developing a sense of urgency about medical device management as a business strategy that can support multiple objectives:  to lower operating costs, to increase patient safety and to produce data that will help to improve the quality of patient care.

Medical device management brings into sharp relief how hospitals are struggling to meet the demands of modern healthcare delivery. Cardiac valves, pacemakers, stents and hip and knee joint replacements save lives, relieve pain and restore mobility. Improved reliability, safety and patient outcomes have fueled dramatic growth in the use of implants across almost all specialties. In orthopedics alone, knee arthroplasty and hip replacement procedures have more than doubled over the course of a decade, recently accounting for 14% of total OR procedures in U.S. hospitals.

To manage their implant inventory, most hospitals are forced to deal with multiple information systems to document regulatory compliance records and patient case files, to update inventory and to submit billing. OR staff members stick package labels marked with notes into overstuffed, three-ring binders that serve as compliance logbooks. Duplicate data entry into computer systems is inefficient and prone to error every 300 keystrokes. Consider that an orthopedic procedure may need to document as many as a dozen or more product codes and serial numbers on one patient.

It's challenging for providers to track which devices are implanted in which patients in these systems. It's nearly impossible for them to gain visibility into their medical device inventory needs, use and replenishment patterns, device pricing and the clinical performance of individual devices.

The most progressive hospitals are tackling these challenges and creating new opportunities through the use of new, modern medical device management systems (MDMS). Unlike a process automation technology that solves a single problem, for example compliance documentation, MDMS supports a hospital's transformational business strategy. MDMS integrates Joint Commission and FDA regulatory compliance, medical device inventory management and recall management into a single system. MDMS systems are cloud based for easy access by users and low maintenance for hospital IT. While the lack of data standardization is an obstacle to interoperability, MDMS are engineered to flexibly network between most major IT vendors clinical, materials management and billing information systems.

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The providers who are successfully mastering the transition to MDMS share in common these five strategies:

1. They use an MDMS system that automates data capture and streamlines their workflow process. Automating data capture using barcode scanners and RFID storage is the first tactical step in an overall MDMS strategy. A barcode scanner can accurately capture all device packaging data including product expiration, ensuring that the data is not only accurate, but also comprehensive and consistent. Medical device registration is another manual procedure that can be automated through an MDMS. Registering a medical device with the manufacturer is a critical step in the patient safety continuum that currently is handled by postcard.

2. They are adopting UDI as their medical device data standard. The FDA's Unique Device Identification rule established a standardized labeling protocol to clearly identify medical devices for the purpose of patient safety, post-market surveillance and more efficient and faster product recalls. As of September 24th, manufacturers must include UDI-compliant labels to Class III implantable devices. Standardized labeling makes it possible to efficiently and accurately capture, document and share information about medical devices. The Joint Commission requires hospitals to track many of these devices and standardized UDI labeling, creating a huge opportunity to make compliance, inventory management and recall investigation much more efficient and timely. 

3. They see the value in early adoption. Janet Paul, RN, CNOR, BSIT, a clinical applications analyst at Lexington Medical Center, a 414-bed hospital with 23 high volume OR suites, made a strong point about the benefits of MDMS in a presentation at the AHRMM15 conference in August. The early results achieved from Lexington's MDMS made a persuasive case: simplified Joint Commission audits, expiration date reviews that led to reduced waste and increased supplier credits, fewer errors in the data base and increased patient safety because of the ability to immediately respond to FDA device recalls.

Transformation doesn't happen in a vacuum and Janet credited the early MDMS results to a team of willing collaborators from the OR staff, informatics, doctors, risk management, IT, finance and supply chain/materials management.

Janet also argued that other industries, such as retail, were able to drive transformational change in the supply chain, but not before going through a transitional phase. Today, an MDMS can capture product codes, catalog numbers, serial numbers and GTIN barcodes (the unique device identification information that is embedded in the barcode in a standardized format).

4. They are eager for data. The most immediately usable data to be extracted from an MDMS is device use and replenishment trends, device pricing and reimbursement patterns, real-time available inventory, wasted or expired trends and physician preference. From this data set, a hospital can begin to manage operating costs.

5. They are insisting on certifying rep delivered inventory brought in the day of surgery. For years, hospitals have been implementing rep certification services from third party vendors but recognize a significant gap in assuring the quality of the implants reps bring with them. These devices are typically pulled from a rep's basement or garage, loaded into the trunks of their cars and brought straight to the OR without any screening. Utilizing bar code scanning, with new UDI friendly bar coded packages, hospitals can now ensure that implants have not expired or been recalled at the same time a rep signs in to receive their badge to enter the hospital.

The real missing link in the medical device value equation is quantifiable data about device performance, and how variables like surgical techniques and post-operative therapy affect the final outcome for the patient. 

Hospitals that take this next step will be empowered with the insights they need to fulfill their mission to drive down costs, improve quality and patient outcomes.

Peter Casady is the co-founder and chief executive officer of Champion Medical Technologies, a privately held, healthcare information technology company based in the Chicago area.

References:
1. Most frequently performed operating room procedures in US hospitals. Statistical Brief #186. Healthcare Cost and Utilization Project (HCUP). March 2015. Agency for Healthcare Research and Quality.
2. Bob Kehoe, "Seeing Device Costs Clearly," Hospitals and Health Networks, 05May2012
3. Global Healthcare Exchange (GHX)
4. Ohio University's Automatic Identification and Data Capture Lab
5. How Medical Device Identification Supports High Quality Healthcare, PEW Charitable Trusts
6. Compliance dates for UDI requirements, US FDA, Medical Devices

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