By Victor Celiberti

St. Anthony’s Health Care,
St. Petersburg, FL

How to further reduce supply costs with the automated inventory system

Added inventory items to the automated inventory system and brought additional departments online

Par Excellence, Cincinnati, OH

The Materials Management department at St. Anthony’s Health Care, a 395-bed acute care hospital in St. Petersburg, FL, that is part of the BayCare Health System of not-for-profit hospitals, reviewed its automated inventory system in January 2003 with the goal of identifying areas for improvement. Since then it has expanded its use of the system.

Five years ago, St. Anthony’s turned to PAR Excellence Systems, a Cincinnati-based manufacturer, to automate the hospital’s inventory system. PAR Excellence provides a complete line of products that use a point-of-use data collection system to automatically track supplies and charges to patient accounts. The system supports bar-coding or "iButton" technology. St. Anthony’s uses the iButton technology which uses a hand-held, battery-powered probe that can sense an "iButton" used to store supply-chain information. When the probe touches the button, the information is transferred to the probe. When the probe is placed in its storage cradle, that information is downloaded to the hospital’s computers in a process that eliminates keyboard entry.

In its review of the system, the Materials Management department began by assessing the storage rooms of different floors and hospital units and studying inventory reports to determine which supplies were being used the most. The department also asked the nursing staff and other departments for their input on how to improve the process. The department immediately found ways to further streamline the process. For example, the department removed the bulky sliding shelves in the supply room for the Intensive Care Unit. Those shelves were replaced with a wall hanging, panel and plastic bin system that give nurses a better view of the supply room. Those improvements freed up enough space to add about 50 different items to the supply room. The department also made sure that storage bins were used to capacity. Doing that eliminated the number of weekly trips to refill those bins. "We reduced the amount of labor it took to replenish the inventory," said Victor Celiberti, St. Anthony’s director of materials management.

The improvements also decreased the amount of time spent by nurses to obtain necessary supplies. "We gathered the data on the items that nursing units were ordering repeatedly, then added those to the system," said Celiberti. This allows nurses to spend more time caring for patients, instead of worrying about re-ordering basic medical supplies such as bandages, syringes and IV fluids. "Customer service is always our goal," said Toni Mitchell, supervisor of St. Anthony’s distribution department. "It’s our ultimate goal."

The results have been remarkable. By tweaking the system with seemingly minor adjustments, the department increased the number of items it supplied by about 51 percent and increased efficiency by about 30 percent. "We basically reduced the workload by 30 percent," said Celiberti. The department also brought online units that were still using the older and more manual way of inventory control. By using the automated system, those units saw a monthly decrease of 12 percent in their supply expenses.

Before the automated system, the Materials Management department manually counted supplies in each storage room. The process took hours at a time. Now, the new system keeps track of the supplies in real time and automatically notifies Materials Management when something needs to be re-ordered.

That meant nurses no longer had to worry about tracking supplies and filling out requisition forms. "Nurses kind of lose the headache of having to re-order supplies," said Richard Frankenfield, BayCare Health System’s director of materials management.

That’s what happened when St. Anthony’s Emergency Department went online with PAR Excellence in June 2003. Before, emergency room staff kept track of their unit’s inventory, re-ordered supplies and restocked the items. "It was very time-consuming," said Deborah Armstrong, Emergency Services Nurse Manager. Now, the system keeps track of the inventory and automatically notifies Materials Management when supplies need to be restocked. "It frees up my staff," said Armstrong. "We have much better inventory continuity now. It’s been great."

The transition to the automated system went smoothly, Armstrong said, because the Materials Management department constantly tweaked the system to meet the needs of the emergency room and addressed minor issues before they became major problems. "This has just made our inventory painless for us," Armstrong said.

As far as user training for the system, Celiberti said, "Nurse training is minute. It takes ten minutes to train a nurse to the system. A ten to fifteen minute orientation and they’re good to go, which is one of the reasons we like the system so much."

The system also improved patient billing. In the past, nurses used a sticker system and charge forms to track patient billing. At the end of the day, those charges had to be manually keyed into the system. With the PAR Excellence system, nurses store billing information with two probe scans: one on the iButton for the patient’s name and a second scan on the button used for the medical supply item. "It is the most cost effective way to capture charges," Mitchell said.

The system also helped the Materials Management department focus more on process improvement. That’s why the department decided in January to tweak the PAR Excellence system. "The team becomes more analytical when you give them tools like this," Celiberti said. "They become proactive instead of reactive."

Before the redesign and improvements, St. Anthony’s had about 1,400 items in the PAR Excellence inventory system. After the improvements, the hospital had more than 2,100 items in the automated system. St. Anthony’s also reduced the number of supply lines being delivered monthly by more than 3,200 lines, or 30 percent, thanks to the system improvements. "In looking at par levels and frequency of supply orders, we found several items that we were using one or two of everyday," said Celiberti. "By increasing par levels and decreasing order percentage, now instead of restocking one or two of the same item five days a week, we restock 15 of that item, one day a week. It reduces our steps, reduces our processes and our variable costs that we can control."

At press time, St. Anthony’s was bringing the cath lab online to the PAR Excellence system, and, said Celiberti, they plan to bring up the OR, endoscopy, anesthesia and outpatient endoscopy by the end of the second quarter 2004. Celiberti says he absolutely forsees additional savings through the new implementations.

Victor Celiberti is the Director of Materials Management,
St. Anthony’s Hospital, St. Petersburg, FL. Prior to
St. Anthony’s, he was the Distribution Manager at Morton
Plant Hospital in Clearwater and an Account Manager at
PAR Excellence Systems.