Tag Archives: item master

Ensuring the Resilience of Your Supply Chain – Team, Strategy and Tools – Part 2

Excerpts from a Conversation with Intalere Senior Advisory Specialist, Tracey Chadwell

In our previous post, we introduced the concept of supply chain resiliency, and shared insight on building your team and several strategies you can undertake as you move through the process.

Now that we’ve got the team and we’ve got some of the strategy in place, what are some of the tools that are most important to implement to help you get ahead of the curve? What are some of the things that you can do in utilizing opportunities through the various partners on your stakeholder team?

It’s very important to build relationships with local, national and non-traditional suppliers. Obviously, suppliers can provide you access to products, but as we learned during COVID, having a variety of resources is important.

We were going places like Home Depot, which is not traditionally thought of as a supplier for medical supplies, but they were able to provide things like N95 masks and other types of protective equipment. To keep those relationships very, very vital, you need some pre-planning to develop needs-based allocation strategies to ensure access to your supplies.

This can be done through the suppliers directly, especially the local suppliers, but it also needs to be done through your distributors who can also assist with identifying alternative products, strategic sourcing and risk share models, as well as storage of products and inventory management. Some of them offer an opportunity to serve as your warehouse or your storage area and will bring the supplies to you on a regular basis so that you don’t have to allocate that extra space normally required for inventory. Speak with them about possible opportunities to see how they can assist.

Suppliers/Distributors will sometimes initiate allocations to prevent excessive ordering and to promote the availability of needed products to other healthcare providers. We saw some of this happening during the pandemic, where it may benefit specific facilities, but it also hurt others down the line with not having product availability. That’s something we need to work with our distributors on proactively, so that we have our products, but our neighboring facilities have their products as well.

Your GPO can be an incredible resource in that they can help determine reliable sourcing methods, purchasing partnerships, etc. Many GPOs are now looking at onshore/nearshore sourcing, diversifying sourcing and product substitutions, so that we’re not in a position again where we are not able to get products because of where they were made. They are looking at non-traditional suppliers and vetting them to ensure providers are not taken advantage of.

Another area that’s incredibly important is that transparency is the name of the game along the entire supply chain. We need tools that are going to help put data together and provide actionable information and provide transparency.

Some larger organizations are implementing ERP or enterprise resource planning, a cloud-based solution that basically allows you to find the product from when it hits your door to when it’s actually being used on the patient. With that, you have the visibility to utilization and inventory levels, and can see where it’s being used, how it contributes to cost of care and how it actually flows through your financial software.

We’re seeing a lot of system integration and interfaces come up. That allows for data flow between different systems so that you can put the big picture together and see what’s going on with your inventory systems, your staffing models, your patient information and more.

Item master cleanup is incredibly important because if you’re not using accurate data, the decisions you make based on that data are often flawed. There are services that provide item master cleanup and maintenance that are worthwhile in resolving this issue.

For smaller facilities, we’re seeing a lot of solutions coming out that are procure-to-pay. From ordering all the way through finance, it’s a chance to integrate what’s going on. Many of these solutions can be scaled down to fit smaller institutions. It basically makes it almost like an Amazon-type setting. You can put your ordering in and it helps with your three-way reconciliation, you can do inventory management and you can do charging from it with barcodes. And again, this would all feed into the financial software.

Finally, there are stand-alone inventory management systems so that you can see what’s there, how much you’ve got on stack and what they have on the units. Again, all of these systems help you in knowing what’s there, knowing what the availability and usage is, and can really help you do some predictive analytics and determine what needs to be ordered when, how much to keep in stock, develop your par levels, etc.

To go one step further in looking at workflow efficiencies, we also have robotic process automation (RPA). Basically, any repetitive process can be set up so that it is done by a software “robot,” freeing you up to spend more time for example with enhancing your revenue by addressing accounts payable, versus making repeated calls to insurance companies for refiling or for pre-authorizations.

That’s another area we’re seeing more and more because in going virtual, a lot of things fell by the wayside due to the fact we didn’t have processes in place for them. Having these types of solutions in place now makes us much more viable and sustainable. If something like that should happen again, and you can continue these processes, continue generating revenue, continue communicating with patients and insurers, you don’t have to fall behind or play catch up when you get back to the office.

These are just some of the best practices that can be helpful to anyone depending on where they are in their level of supply chain maturity.  

Something that really came out during the pandemic is just making sure that you’re prepared and you’re proactive in working with those other sourcing alternatives. Whether it be reuse or other alternative systems, they all work together to make sure that you don’t have a drop in service or you’re still able to ensure that you’re taking care of patients and customers at the high levels they have become accustomed to from your organization.

We Can Help

For further information on any of our resources to help you deal with your supply chain challenges, visit our website at intalere.com. You can review our recent Supply Chain Resiliency podcast and infographic, as well as success stories and recent blog posts on a wide variety of supply chain topics.

Intalere Member Best Practice Spotlight – Mankato Surgery Center – Managing the Supply Chain and Inventory Efficiencies

ISSUE

Mankato Surgery Center was noticing variables in the year-end physical inventory counting, inconsistencies in product nomenclature, inaccuracies in identifying consignment inventory, and inaccuracies of the physical counts that lead to significant over-valuation of inventory and difficulty in determining profitability.

SOLUTION

A newly created multi-disciplinary Inventory Efficiency Workgroup identified the general assumptions and developed a project scope. The objectives for the project were to eliminate the duplication of labor that occurred during the annual physical inventory of correcting entry counts and to eliminate the erroneous inventory valuation during the annual financial audit. After thorough auditing, benchmarks were created. The multi-disciplinary workgroup team approached and solved the issues from different focal points.

OUTCOME

It was determined that the Item Master List was the pinnacle of the overall issues. Seven percent of products on the Item Master List were identified as inconsistent nomenclature and product misidentification. Staff spent more than 60 hours correcting the Item Master List. Further, the annual financial audit showed inventory was overstated by 94.4% and by removing vendor-owed inventory from the Consignment List, the correct inventory value was calculated. It was also found that the Implant Inventory was set at an artificially high quantity to save computer key strokes, so this was eliminated, thereby, eliminating the artificial high-value of inventory.

ABOUT MANKATO SURGERY CENTER

Mankato Surgery Center, accredited by AAAHC, is a multi-specialty, physician- owned ambulatory surgery center located in south-central Minnesota. Mankato Surgery Center focuses on providing the highest quality ambulatory surgical care with state-of-the-art surgical equipment and technology, and highly skilled and trained staff.

Check out the project video and view the Mankato Surgery Center page in the 2018 Intalere Best Practices Compendium.

Enhance the Effectiveness of Your Supply Chain with Clean Data

By Shon Wettstein, Vice President of Business Development and Product Management

Clean data could be defined as accurate catalog fields that reduce transactional discrepancies, promote in-depth organizational reporting and assist in the implementation of standardized product categories across your enterprise. Clean data is always a work in progress, not just an outcome. So what are some of the main issues or problems around “item enhancement,” and data cleansing in your item master? And why is it so important? 

Who benefits from high quality item master data? The answer is…EVERYONE! The benefits of high quality data are nearly endless. From scheduling cases to prepping cases to usage and documentation, to purchase order processing and transport, to payment process and transport, all the way downstream to the most important benefactor – the patient.

Every single day the healthcare supply chain wastes 24-30 percent of supply administration time on data cleansing and corrections, costing the healthcare industry billions of dollars. What can be done?

Adopting GS1 standards for healthcare is a first step. GS1 is the primary organization that also defines the standards for the UPC that you see on all retail products. The major elements of the GS1 standards are the 3 Gs which help in the identification, locations and data attribute accuracy of products in the supply chain.

By having a unique product number for every item, it will allow for the free flow of products and associated information from the point of manufacture to the point of use. Key elements of this also include unique markings that allow for the easy capture of information on the product and the sharing of that information throughout the supply chain.

How can you further begin to build a framework for item master efficiency? First, establish data governance. Make sure that item master files have consistent established rules regulated by a few within the organization. You should also be managing data at all points of entry, whether coming internally from supply chain or the stakeholder. Also, establish a consistent process and procedure in areas of requisitioning, order fulfillment, purchasing and accounts payable, and identify opportunities to collaborate with other departments that are using supply chain data, such as surgery system, patient charging system, etc.

Next, you should develop basic item master policies that include things such as product series consistency, units of measure, descriptions, etc. Adhere to the policies, and track the exceptions.

In conclusion, the item master is your organization’s information source for some of the most important supply chain activities – procurement, charge master comparison and/or linking, data standardization and value analysis. If this data is disorganized and contains errors, then it will be very difficult to improve operations and control costs in your facility. Maintaining your item master will help you use the right products that not only drive cost containment but provide quality care and improve patient outcomes.

Read our full article Item Master Efficiency and Clean Data. By leveraging industry standard data sources such as GUDID, GDSN and First DataBank, Intalere OptiMIM Advantage combines data to a single trusted source that will improve operational efficiencies and reduce financial, safety, regulatory and product risk. Intalere OptiMIM Advantage also enables the supply chain to more efficiently leverage data to perform analytics of supply items to reduce supply costs, increase procure-to-pay (P2P) efficiencies, and improve integration and accuracy on point-of-use capture. Contact Intalere to learn more.