WakeMed Wins VHA Leadership Award for Supply Chain Management
Raleigh, NC - WakeMed Health & Hospitals has received was the VHA, Inc., Leadership Award for Supply Chain Management Improvement. selected by Voluntary Hospitals of America (VHA) for a Leadership Award This award honors healthcare organizations that demonstrate significant innovation and improvement in the areas of product selection, contracting/sourcing, procurement, standardization, distribution and logistics, inventory management, and product utilization.
VHA specifically recognized WakeMed for the 2005 joint initiative between Materials Management and the Heart Center. Among the accomplishments were: negotiating supply cost savings in excess of $4.2 million; reducing the supply replenishment cycle time; achieving an inventory accuracy rate of 98 percent; instituting inventory process improvements which resulted in a case cancellation rate of less the .02 percent; and implementing barcode scanning of supplies. The year-long supply-chain improvement initiative resulted in a negotiated cost savings in excess of $4.2 million for 2005.
The outcomes from this year-long initiative included a reduced supply replenishment cycle time and inventory accuracy rate of 98 percent. Inventory improvements positively impacted patient care by achieving a .02 percent case cancellation rate due to unavailability of supplies. Additionally, a single point-of-entry hemodynamic/electrophysilogy monitoring system delivered increased efficiency.
Costs for medical supplies continue to rise as new technology is introduced,� stated Joseph Crider, manager, Ray CaseyProcurement Services. Procurement Services Conversely, healthcare reimbursements are decreasing. Faced with these realities, as well as the recognition that supplies and services are the second largest expense within most hospitals, supply chain process improvements and negotiated savings are imperative.�
Cardiology programs typically use some of the most expensive supplies in hospitals,� stated Paula Cole, procurement agent for the Heart Center. So, naturally, we knew our efforts had the potential to yield significant savings.� But rather than using a re-engineering approach, the teams concentrated on refining existing processes and exploiting technologies already in-place. Cole continued, With a few exceptions, the methods we used probably wouldn�t generate a huge �buzz� in the field of supply chain management. However, by consciously taking a long-term view and instituting a multi-pronged approach toward improvement, we believe we�ve set the stage for even greater savings and efficiencies in the days ahead.�
Cole elaborated on the foundation for their success. Our primary focus was increasing the communication and collaboration between physicians, clinicians, suppliers, and Materials Management. We realized that each participant in the supply chain was an expert in his or her field. However, each participant was making decisions that were �best� from their point of view. But their perspective was often incomplete. For example, when clinically similar products have significant cost differences, it�s my responsibility to make the physicians and clinicians aware that opportunities for savings exist. Our entire team has patient safety and care as their primary focus; however, we must still conduct business in a fiscally responsible manner. By opening the channels of communication, we now make more informed decisions. Likewise, today there�s a greater sense of trust and appreciation between all supply chain participants.�
According to Betsy Gaskins-McClaine, vice president, Heart & Vascular Services, Without a doubt, the teamwork between physicians, Purchasing, Materials, and the Cath Lab/EP management and staff enabled us to achieve these savings. New products were evaluated, clinical and fiscal implications were considered, and honest feedback from all team members allowed us to focus our efforts. In the end, our patients are the beneficiaries, since we can reinvest those savings in new technology/supplies which will allow us to continue to provide leading edge cardiovascular patient care.�
The team believes that more opportunities for improvement exist, however. According to Brenda Meares, director, Materials Management, We have several other initiatives under consideration which will further streamline our procurement and inventory processes. The most promising improvements include radio frequency identification (RFID) tracking of supplies, creating an interface to automate patient charges for applicable supplies, and reducing supply replenishment lead-times.�
About VHA
Based in Irving, Texas, VHA Inc. is a health care provider alliance of more than 2,400 not-for-profit health care organizations. We help members deliver safe, effective and cost-efficient care through both national and local support. VHA has 18 regional offices in 48 states as well as offices in Washington DC.
