System streamlines inventory usage

Staff at Adventist White Memorial can track use of cardiovascular supplies in real time using its inventory management solution.

Image courtesy of Cardinal Health

Adventist White Memorial has been serving communities in and surrounding downtown Los Angeles since 1913. The 353-bed, nonprofit and faith-based teaching hospital provides a full range of inpatient, outpatient, emergency and diagnostic services.

To maintain smooth delivery of care, the hospital works to ensure its supplies are well stocked and up to date. That task, however, became increasingly difficult in the hospital’s cardiovascular department as it worked to keep track of more than 1,700 stock-keeping units.

Daniel Moreno, R.N., MS, cardiovascular line administrator, identified four supply chain issues the organization faced and needed to fix:

• Inconsistent, manual and time-consuming processes for ordering, storing and replenishing supplies led to a lot of wasted staff time and money.
• No easy way to locate or track expired and recalled products caused the hospital to lose money every time a product expired before it could be pulled from the shelf.
• Little supply chain visibility meant more lost money due to excess inventory. Staff had no easy way to see which products were available, how they were being used or whether they had been charged to a patient.
• Inconsistent workflows because each staff member had his or her own approach to managing supplies manually.

Moreno and his team searched for a solution that would help reduce costs, drive efficiency, support patient safety and free up caregivers’ time. It chose the Cardinal Health Inventory Management Solution that leverages radio-frequency identification technology to manage the supply chain of its five-unit cardiovascular department.

Before implementing the solution, however, the hospital recruited a third party to conduct a two-phase time-and-motion study to track improvements. The first phase focused on measuring how much time was spent using purely manual processes to count and track supplies. It also included anecdotes from staff to get a better perspective on the issue. Staff submitted comments such as “When the pace is slow, it’s easier to keep good inventory records. When the pace is fast, it’s hard to stay on top of it. When we’re busy, inventory and supply ordering is the last priority for the staff, and manual counting is the last thing to get done.”

The inventory management solution enabled White Memorial to automate its supply chain processes, providing real-time, end-to-end visibility that helps health care providers dramatically improve workflows and virtually eliminate manual cycle counting. The solution provides quick and easy access to data that can drive new insights into improving performance and driving down costs.

The second half of the study measured time staff spent on the same supply chain tasks for three months. Results of the study showed measurable savings. Staff saved six hours and 50 minutes on average per week, translating to 357 hours per year. When broken down by tasks, the hospital was able to recoup 176.8 hours per year from cycle counts, 200.2 hours per year on order placement and 93 hours per month on tracking expired product.

The hospital saw significant cost savings, as well. It saved $42,000 in initial savings from improved charge capture and $120,000 in yearly savings by identifying products before they expire. The cardiovascular unit has 100 percent eliminated manual counting and rush shipping due to stockouts.

“We were tossing out $10,000-$12,000 worth of expired product every month. Now we’re alerted when a product’s going to expire, and we know exactly where to find it,” Moreno says. “I no longer have to worry that an expired product will be used in a procedure because it was laying around in a back closet.”

The hospital also has 100 percent consistency in supply chain processes across its entire department.