SESSION TITLE: Engaging the Surgical Team in Supply Chain Management Process Improvement

SPEAKER NAME: Scott Strech, MBA, BSN, RN Kelly E. Sims, BN, RN Sharon S. Pomeroy, MHA, BSN, RN Laurie Profitt, RN

SESSION NUMBER: 9026 & 9112R

DATE/TIME: Monday, March 4, 2013, 11am-12pm & 1:15-2:15pm

CONTACT HOURS: 1.0 CH

OVERVIEW: This presentation shares various initiatives to improve supply chain knowledge and utilization. The primary focus is engagement of the surgical team in supply chain management and cost reduction. We will discuss changes that have forced our organization to evolve and modify to improve efficiency, decrease waste, and improve operational performance. We will share recent multiple large scale initiatives to improve education around supply chain issues and practice for utilization of disposable/implantable supplies.

OBJECTIVES

1. Describe common issues for OR supply chain management. 2. Describe the systems and processes used to manage the OR supply chain. 3. Describe the informatics platforms and systems used, specifically enhancements

undertaken to improve data sharing and transparency. 4. Demonstrate processes undertaken to both help with reprocessing and minimizing impact

on the environment. 5. Demonstrate processes undertaken to increase data collection, data sharing, and

meaningful use of data to engage surgeons and staff towards more effective workflow.

BIOGRAPHIES: Scott Strech, MBA, BSN, RN, is director of perioperative education and research for Vanderbilt University Medical Center, where a primary task is oversight on educational activities for staff and faculty. This includes on-boarding education and competency assessment, ongoing educational content development, and delivery. Other responsibilities include the development and oversight of a perioperative services nurse internship for both new graduate nurses and experienced (non-OR) nurses. Specific to this presentation, a major project undertaken has been to assess and share knowledge regarding our supply chain processes. Kelly E. Sims, BN, RN, is perioperative services patient care manager at Vanderbilt Medical Center, where she has been employed since 1986. Her responsibilities include, but are not limited to, OR scheduling, OR doctor preference cards, hospital-wide tissue tracking, perioperative recalls, and OR billing audits.

Sharon S. Pomeroy, MHA, BS, RN, has over 26 years' experience in the combined areas of perioperative services and supply chain. She has been the medical supply sourcing officer at Vanderbilt University Medical since 2007, where her responsibilities accountability for the oversight, implementation, and development of new supply chain systems designed to provide maximum efficiency and cost effectiveness in the perioperative service line. She is also responsible for identifying material resource savings opportunities through the analysis of supply utilization practices, delivery systems, and contract compliance. Sharon has done presentations on the local and national level, and was published "Patterns of Laser use at Vanderbilt University Medical Center" in Minimum Invasive Surgical Nursing in the Fall of 1994. Laurie A. Proffitt, MS, BSN, RN, is the perioperative billing auditor at Vanderbilt University Medical Center. She actively engages with managers and staff at all levels to improve the billing process within perioperative services. Laurie's audit procedures enable her to review the supply charge capture in the Point of Use (POU) system and educate Vanderbilt staff over the supply chain process. Laurie works closely with the POU team to ensure that the employees are utilizing the system in order to improve overall efficiency and productivity in the supply chain process. POU has increased the transparency of data to the staff and surgeons at the supplies point of usage in the operating suite.

CONTACT INFORMATION: Scott Strech, MBA, BSN, RN Director, Education & Research Vanderbilt Medical Center Franklin, Tennessee E-mail: scott.strech@vanderbilt.edu Kelly E. Sims, BN, RN Manager, Perioperative Services Vanderbilt Medical Center Nashville, Tennessee E-mail: kelly.sims@Vanderbilt.Edu

Sharon S. Pomeroy, MHA, BSN, RN Medical Supply Sourcing Officer Vanderbilt Medical Center Nashville, Tennessee E-mail: sharon.pomeroy@Vanderbilt.Edu Laurie Proffitt, RN Perioperative Billing Auditor Vanderbilt Medical Center Nashville, Tennessee E-mail: laurie.a.proffitt@Vanderbilt.Edu

FACULTY DISCLOSURE: Scott Strech 7. No conflict. Kelly Sims 7. No conflict. Sharon Pomeroy 7. No conflict. Laurie Profitt 7. No conflict.

Corporate support for this session provided by PDI.

Reference: http://www.omnicell.com/Products/Supply_Management/OptiFlex_MS_Medical_Surgical.aspx

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Acknowledgements

A significant thank you to the major contributions from:

Brian Rothman, MDAssistant Professor, Department of AnesthesiologyMedical Director, Access & Administrative OperationsMedical Director, Perioperative Informatics

Vik Ti iVikram TiwariSurgical Business AnalyticsAssistant Professor of Anesthesiology

Driving Forces

People

$100 TechnologyTransparency

Process

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National Trends Impacting Health Care Reimbursements

• Health Care Reformo CBO - 95% population covered (~32 million newly insured), while

reducing the federal deficit by $138 billion over 10 yearsreducing the federal deficit by $138 billion over 10 years

• Medicaid expanding (~16-22 million people ~$80 billion annually)

• Safety net facilities and those caring for higher proportions of this population may see a more severe scenario with these challengesg

• More financial risk assumed by hospitals with continued move away from fee for service, towards ACOs

• Medicare and Medicaid cuts of ~$158 billion over 10 yearso Medicare update factors ~$112 billion

National Trends Impacting Health Care Reimbursements

po Medicare Disproportionate Share Hospital (DSH) payments

$22 billiono Medicaid DSH ~$14 billion

• Medical education oRedistribution of slots and fundingo Funding (DME & IME) Medical Education both at risk

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National Health Care Spending

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• VUMC 995 licensed beds for adult patients and dedicated pediatric o hospital with 250+ beds, Level 1 trauma center, academic medical center

• 63+ Adult and 19 Pediatric operating rooms in seven (7) primary procedural locations include three (3) offsite ASCs and 5 operating rooms

Perioperative Enterprise Overview

o locations include three (3) offsite ASCs and 5 operating rooms

• Over 56,000 procedures annually, trending upward

• Off site case cart operations center

• Faculty and Staffo 400+ Surgeons, fellows, and residentso 200+ Anesthesiology faculty and staffo 200 Anesthesiology faculty and staffo 1100+ Clinical/Allied Health & Ancillary Staff

Why We Need Economic Repositioning Initiatives

• Margins and reimbursement are shrinking while costs (supplies, labor) are rising

• Surgical supply expense is a significant driver of cost• CMS data showing 6% annual increases in health care

cost• Maintaining quality patient outcomes while cutting cost• Overall need to do more with less• Reductions in Disproportionate Share Hospital Payment

with the Patient Protection and Affordable Care Act (PPACA)

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Patient Volume (Adult Enterprise)

Supply Chain Overview

Annual Supply Expense:  $375MAnnual Purchase Orders: 146,000Annual Purchase Orders:  146,000Annual PO Lines:  1,500,000

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What Drives Hospital Supply Chain Costs?

Waste• Increased inventories increased carrying costsy g• Multiple vendors for same process• Poor inventory and supply tracking• Non-standardized procedures

T i i t

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Training costs, Staff satisfaction

• Staff/Unit Engagement • Off site case cart operations center (CCOC)

C

Initiatives

• Nurse Friendly CPT description• Custom Pack Review • Case Scripting• Auditing • MEOC • Reprocessing

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Staff & Faculty Engagement

• Service Line Teams

• Cost Boards/NewsletterCost Boards/Newsletter

• Clinical Ladder Projects

• Constant Sharing of Case Cost Information

• Team Meetings

Low Tech Transparency

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Unit Engagement

Case Cart Operations Center (CCOC)

• We chose to invest money off-site so we could use our very expensive on-site real estate for revenue generating departments

• Owned and operated by VUMC

• 51,000 sq. ft. space for instrument storage, instrument processing, supplies, and room for growth

• Moving from traditional medical supply chain to a true supply chain environmentsupply chain environment

• Dealing with the constant ebb and flow of the OR schedule

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Nurse Friendly CPT Description

The release of Nurse‐Friendly CPT names will improve the nomenclature of the current long surgical CPT description to a more staff friendly surgical descriptiona more staff friendly surgical description. 

Custom Pack Review Goals

• The goal of this engagement was to do a deep dive into our custom pack program to identify potential savings through:p g go Examining current pack contents and evaluating any lower

cost alternatives for existing components in the pack

o Reviewing items being pulled consistently with existing packs to determine if we can provide those items inside the pack at a lower cost

R i i d th t tili t k th to Reviewing procedures that may utilize custom packs that aren’t the best fit for that procedure and determining if we can drive savings through creating a more procedure specific pack

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• Elimination of one pack (combined 2)

Custom Pack Review Results

• Creation of five new more procedure specific packs

• Reduction in annual pack spend of $5,300/year

• Procedural Supply Cost savings of $141,596/year

Summary View of Data Analysis (Service Line)

CAS_SERV NEU

Row Labels

Count of CAS_PRIMPROC

Average of Total Costs

Sum of Total Costs2 1Row Labels OC Costs Costs2 1

61886‐SUBQ PLACEMENT CRANIAL NEUROSTIMULATOR PULSE GENERATOR/RECEIVER;W/ CONNECTION 2+ ELECTRODE ARRAYS 260 $20,207 14.92% 2

61885‐INSERT/REPLACEPLACEMENT CRANIAL NEUROSTIMULATOR PULSE GENERATOR/RECEIVER;W/ CONNECTION SNGLE ELECTROD ARRAY 134 $16,660 6.34% 3

22842‐POSTERIOR SEGMENTAL INSTRUMENTATION; 3‐6 VERTEBRAL SEGMENTS 190 $10,969 5.92% 4

22614‐ARTHRODESIS, POSTERIOR/POSTEROLATERAL, SINGLE LEVEL ADD`L SEGMENT 159 $11 520 5 20% 5SINGLE LEVEL; ADD`L SEGMENT 159 $11,520 5.20% 5

22630‐ARTHRODESIS, POSTERIOR INTERBODY W/ LAMINECTOMY/DISKECTOMY, SINGLE INTERSPACE; LUMBAR 126 $11,800 4.22% 6

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Summary View of Surgeon Comparison Data

ValuesCount of

Row Labels

Count of PMF_DESCRP

Average of Total Costs

Average of TotalProcs

Average of Surg Elap

Average of HOSP_LOS

Average of ASAclass

Average of BMI

Average of Age

30520‐SEPTOPLASTY/SUBMUCOUS RESECTION W/WO CARTILAGE SCORING/CONTOURING/GRAFT 380 $478  3.4 96 0.4 2.0 29.3 41.4

Dr. A 52 $560  4.9 110 0.2 2.1 29.7 41.3

Dr. B 22 $189  2.5 96 0.2 1.7 29.5 34.1

Dr. C 170 $361  2.3 88 0.2 2.0 28.1 41.0

Dr. D 107 $633  4.7 94 0.8 2.2 30.4 43.8

$Dr. E 7 $1,838  5.1 169 0.6 2.0 32.0 45.6

Dr. F 10 $241  3.2 120 0.2 1.9 25.4 35.1

Dr. G 12 $334  2.2 111 0.4 2.0 33.9 41.2

Top Cases by Volume and Expense (Dr. A)

Row LabelsCount of CAS_PRIMPROC

Average of Total Costs

Sum of Total Costs2

61510 CRANIECTOMY TREPHINATION BONE FLAP CRANIOTOMY; EXCISION TUMOR61510‐CRANIECTOMY, TREPHINATION, BONE FLAP CRANIOTOMY; EXCISION, TUMOR, SUPRATENTORIAL, NOT MENINGIOMA 90 $2,093 26.65%

61518‐CRANIECTOMY, EXCISION TUMOR, INFRATENTORIAL/POSTERIOR FOSSA; NOT MENINGIOMA/CEREBELLOPONTINE/MIDLINE 36 $2,197 11.19%

61512‐CRANIECTOMY, TREPHINATION, BONE FLAP CRANIOTOMY; EXCISION, MENINGIOMA, SUPRATENTORIAL 30 $2,450 10.40%

61750‐STEREOTACTIC BX, ASPIRATION/EXCISION, W/ BURR HOLE(S), INTRACRANIAL LESION; 24 $2,163 7.35%

69990‐MICROSURGICAL TECHNIQUES, USING OPERATING MICROSCOPE 18 $2,594 6.61%

61154T‐TRAUMA BURR HOLE(S) W/ EVACUATION &/OR DRAINAGE, HEMATOMA, EXTRADURAL/SUBDURAL(NEURO) 17 $1,980 4.76%

61520‐CRANIECTOMY, EXCISION TUMOR, INFRATENTORIAL/POSTERIOR FOSSA; CEREBELLOPONTINE ANGLE TUMOR 10 $2,961 4.19%

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CPT Code Cost by Surgeon: 61510

Volume Avg Cost Avg # CPT

Avg Surgeon Time

Avg HOSPLOS (days)

Avg ASA class

Avg BMI

Avg Age

61510‐CRANIECTOMY, TREPHINATION, BONE FLAP CRANIOTOMY; EXCISION, TUMOR, SUPRATENTORIAL, NOT MENINGIOMA 271 $2,164  3.2 217 4.7 2.8 27.8 52.5

Dr. A 1 $2,871  2.0 192 8.5 2.8 33 41.0

Dr. B 2 $839  2.0 168 11.1 3.0 31.8 41.0

Dr. C 67 $2,272  3.1 181 5.1 2.7 27.0 52.7

Dr. D 2 $949  2.0 170 15.0 3.5 35.8 35.5

Dr. E  93 $2,070  3.1 245 3.8 2.8 27.5 50.6

Dr. F 106 $2,219  3.4 218 4.8 2.8 28.5 54.6

CPT Code Cost by Surgeon: 61624

Row Labels Volume Avg CostAvg # CPT

Avg Surgeon Time

AvgHOSPLOS (days)

Avg ASA class

Avg BMI

Avg Age

61624‐TRANSCATHETER PERMANENT OCCLUSION/EMBOLIZATION, PERCUTANEOUS; CNS 242 $8,922  5.0 133 8.7 2.9 28.3 52.7

Dr. A 29 $7,946  7.1 200 8.9 3.0 27.6 55.3

Dr. B 17 $4,742  1.4 156 14.4 3.1 26.8 50.2

Dr. C  9 $9,594  10.3 317 5.1 2.8 28.3 48.7

Dr D 38 $12 143 4 4 118 10 5 2 8 27 4 55 6Dr. D 38 $12,143  4.4 118 10.5 2.8 27.4 55.6

Dr. E 148 $8,733  4.8 110 7.6 2.9 28.8 51.8

Dr. F 1 $7,811  2.0 239 26.0 2.8 25.3 74.0

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On Hold Items

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Perioperative Billing Auditor

The purpose of the Perioperative Billing Auditor is to evaluate the efficiency and effectiveness of the billing process for Perioperative Services at Vanderbilt University Medical Center.

Audits

• Internal controls are needed to strengthen our billing process.

• The auditor reviews all surgery bills for errors and omissions and g yrelates these to the appropriate departmental directors and managers.

• The audits review the nursing documentation for accuracy in regards to time charges, service type, CPT procedures, implant and supply charges, and verifies that all information is appropriately documented.

Th dit d t ll i ti i t ff h i• The auditor educates all perioperative services staff on charging standards related to their documentation practices.

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Charging Methods

• OR detail charging methods are used. Detail charging provides our department with the data needed for costsprovides our department with the data needed for costs analysis.

• This detailed charging allows the auditor to support the supply chain initiatives by ensuring proper charging of OR supplies on the case level.

MEOCThe Medical Economic and Outcomes Committee, commonly referred to as "MEOC," is a clinician driven process that standardizesis a clinician-driven process that standardizes and utilizes evidence-based, clinically sound, financially responsible methodologies for introduction or consolidation of new supplies, devices, and technology within Vanderbilt University Medical Center to provide the highest quality medical care.

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MEOC Process Goals

ClinicalF ilit t th d ti f f d f l h lth• Facilitate the adoption of safe and useful health care Supplies and Technologies to improve patient care

• Develop a supply/capital assessment process that is transparent, as well as data and strategy driven

• Find new and innovative ways to impact health care delivery and cost

Financial• Evaluate cost-effectiveness and financial impact of new

MEOC Process Goals

technologies (Capital), physician preference items (PPI), as well as other supplies

• Clinician driven standardization of procedures to improve hospital supply chain costs

• Identify reimbursement for new health care technologies prior to their introduction

• Using benchmark data, compare our financial and clinical outcomes

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MEOC Request/Presentation Process• Requester presents in person

o Disclosures for committee members and requestorsNo sales reps Requester presentations

o Clinical dataIndications/justification for requestClinical efficacy, quality of care, safety dataComparison with existing technology

o Other considerationsOContract issues—price quote, discounts, warranty, serviceReimbursement info (coding, etc.)MarketingCost analysis

Benefits of MEOC

• Improved MD input into Supply, PPI, and Capital decisionsand Capital decisions

• Quality Care: Incorporate EBM and other data into decisions

• Financial: Improve revenue and cost for hospital

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A Successful MEOC…

• Involvement and support of Clinician leaders

• Fair, objective, data driven process, j , p

• Transparency, as demonstrated through the defined processes, that includes Defined Agendas, Minutes, Reports, and Outcomes

• Responsive to not only the requestingResponsive to not only the requesting Physicians and the hospital, but to all staff

Decision to Recycle and Reprocess

Initiative supported and approved through the Medical Economic Steering Outcomes Committee g(MEOC) and Infection Control, as well as promoted by the Sustainability VU, Vanderbilt University.

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6,600 tons of waste are generated by hospitals per day *P ti G H lth

The Need to Minimize Waste

*Practice Green Health

Hospitals generate more than two million tons annually*Practice Green Health

20 30% f di l t i20-30% of medical waste is generated in the OR*Ascent

Environmental Benefits

From VUMC include:• Diverting an estimated 80,000 pounds of waste from

the landfill each year• Emitting 20 metric tons LESS of greenhouse gases

each year from Vanderbilt• Reducing natural resource consumption by Vanderbilt

by thousands of pounds each year, specifically the mining of aluminum, iron, chromium, and nickel, as well as the manufacturing of aluminum and stainless steel instruments

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Systems Used at VUMC to Manage Perioperative Supply Chain

• Pathways Materials Management (PMM)

• JIT Inventory through Owens & Minor (O&M)

• ORMIS

• Censitrac

• Point of USE (POU)

• DPC Editor

Pathways Materials Management (PMM)

• A McKesson Supply Chain ManagementA McKesson Supply Chain Management application used for ordering and inventory control

• JIT - Just in Time Inventory Management through O&M

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ORMIS

• Scheduling

DPC• DPC

• Data

• Billing

Censitrac Scanning

Censitrac scanning isCensitrac scanning is a Quality Tracking Tool to locate supplies and instrumentation for each patient.

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Case Cart Scanned to OR

Scanning Room Location Scanning Case Cart

This one scan will include all supplies and instrumentation that are loaded on case cart. The instruments have already been scanned to the patient using the doctor’s preference card.

Streamlining Supply Chain With Use Of New Software

• The Optiflex software, Point Of Use, is used to manage implant and supply costs directly at the time of surgical use. pp y y g

• POU provides supply management to control inventory costs, improve the materials reordering process and accurately capture charges.

• Supply costs are captured more effectively using the pou inventory module. This allows us to keep inventory low and minimize costs

• POU increases revenue by ensuring consistent and accurate charging. Auditor is able to capture any missing cases in pou and address to retain revenue

• Transparency of supply costs to staff during each surgical case to ensure accurate charge capture

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Point of Use

• Incorporates the preference card and creates a unique bar codes for each surgical case

• Supply costs are captured in each surgical case and items are removed from inventory as they are pulled.

• Reduces manual work for materials management staff gand improved supply inventory management

• Improved charge capture.

Point of Use Supply Utilization Capture with Real Time Cost

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Since the implementation of POU,p ,our annualized charge capturehas improved by approximately

$25K per month.

Monthly Volume & Costs Per Case

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Monthly Variation Costs Per Case

Sample of Cost Per Case Reductions by Service Since July 2011

TRA ‐234.6214005EGS ‐179.7972315URO ‐170.1098483GYN ‐139.5610527TDS ‐125.8592929BMT ‐112.4802543ORTH ‐107.7985335HN ‐46.14376632THOR ‐35.44413453THOR 35.44413453GENO ‐24.79302915HEP ‐11.05892802

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Items Consumed Per Case

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Results

• Clinical Awareness to Supply Expense

• Integrated Doctor Preference Card with Case Pick Process

• Supply Cost Data at the Case/Physician Level

• Automated Supply Capture

• Real Time Visibility