News

RFID: The new strategy in healthcare IT
Is this a technology whose time has come or not?

by Richard A. Perrin and M. Bess McAndrew

Richard A. Perrin	M. Bess McAndrew

Radiofrequency identification (RFID) is being touted as the new strategic weapon to reduce costs in the provision of quality healthcare. Properly deployed, RFID is capable of addressing and streamlining some of the most basic, yet the most critical (and costly) components of healthcare provision – assets, supply distribution and tracking, patient movement, equipment management and accurate medication administration.

RFID system capabilities are powerful and accurate capture data. They can easily be integrated into the hospital’s wireless infrastructure that many hospitals already have in place. However, "To date, RFID has been limited to highly targeted and niche applications – standards are scarce, costs are high, and implementation is an art."¹

Whatever the position of the healthcare provider, the goal is the provision of the five rights of medication administration: "Right patient, right drug, right dose, right route, and right time." Every individual and organization invests a significant amount of money into healthcare and in turn expects a great deal from that investment. The healthcare industry continually collaborates to ensure the provision of improved services while reducing expenses that will result in cost savings – not only to the organization, but also to the patient. In addition, scrutinizing all emerging technologies is critical to see if they are truly a value added asset that will ensure a positive return on investment. Is the technology able to provide information "better" than before? The bottom line is: "Is it worth the investment in hard dollars (cost) and soft dollars (implementation efforts, training, updating current procedures, etc.) for the benefits that will be achieved?"

Evaluating required strategies and investment

In addition to costs, healthcare facilities must consider the extent to which the application of RFID includes all applicable departments. Besides the obvious departments – materials management, biomedical repair services and pharmacy – what other services would benefit from implementing the key features of an RFID system? The team that is gathered to review the potential procurement must consider all of the obvious and some of the less obvious features that can be implemented. And then there is the question of which technology to use – active or passive.

Active RFID applications have signals that are continuously transmitted between transponders and transceivers. Passive RFID require a reader to be waived near a transponder with an RFID chip. In the "Healthcare Without Bounds: Trends in RFID" study the Spyglass Group found that most healthcare organizations were deploying active RFID technologies. This study, conducted in August 2005, reported that "RFID solutions are not ready for large scale, enterprise-wide deployment due to healthcare organization concerns about network infrastructure, network scalability, application availability, and systems integration complexities."² Why?

Industry giants, such as Wal-Mart, Target and pharmaceutical companies have been leading industry efforts to employ RFID. Other business entities make use of RFID; for example, event tickets, passes, ski-lift passes, automatic toll collections, sports timing and airline bag tracking. While it may be awkward to consider patients as part of a supply chain – a fact that forces us to consider some interesting aspects that manufacturing and retail industries don’t routinely confront – patient care and safety are key considerations for use of RFID solutions. Hence, the technology is slowly creeping into healthcare. While passive systems enhance accurate data capture, active RFID systems offer the
additional ability to provide real-time tracking of expensive assets and to monitor location of patients in the department or on the day of surgery. A recently published Microsoft article cites the following:

"The possibilities are as promising as they are varied, and include:

• Tracking pharmaceuticals from the manufacturer, distributor and pharmacy to the point of administering medication to the patient,

• Tracking movable equipment, furniture, medical devices and other high-value items both to provide ready access when needed and to reduce losses,

• Identifying the location of caregivers in hospitals and other institutions to ensure the most efficient assignment in response to emergencies,

• Ensuring the proper identification of laboratory specimens, including biopsy samples and containers of blood or urine to reduce medical errors,

• Tracking patients — both for the purposes of redundant identification prior to the administration of medications or surgery and for protecting infants, Alzheimer’s patients, and others with special vulnerabilities,

• Managing controlled substances, pathogens and other materials that pose a public health risk."³

Getting started,
challenges to consider

One of the initial issues to consider with RFID tags is whether to use active or passive technologies. Each of these provides basic data on the item being tracked, yet the requirements, implications for systems design and implementation, and especially the costs are vastly different for passive v. active tags. Table 1 below provides a summary of key differences between these two levels of RFID tags.

Within the Defense Medical Logistics Support System (DMLSS), the focus on the use of RFID tags is on receiving, assembly of materials to be shipped to different locations and shipment tracking. All of these are in concert with the broader DoD policies supporting use of RFID tags for enhanced asset tracking and inventory management.

The DoD has issued a statement that by January 2007 all DoD manufacturers and suppliers must tag all individual cases, all cases packaged within palletized loads, all pallets and unit packs of assemblages requiring unique device identification (UDI). The DoD’s active RFID policy – updated in July 2004 – applied to all freight containers such as consolidated air pallets and large engine containers shipped to and from overseas DoD receiving points.

RFID presents many challenges and facets that must be considered prior to initiating implementation of RFID capabilities. As with other systems, certain guidelines and strategies should be applied when implementing RFID system initiatives:

• Review capabilities and understand the basic steps that are essential in implementing system changes to ensure achieving optimum value from your future investment in RFID systems.

• Determine the best technologies and systems for the application of RFID capabilities, including passive versus active RFID capabilities, complete replacement of current systems or upgrades to existing systems, etc.

• Be aware that upgrading the technology with use of RFID tags to automate a system and related business process will only provide benefits and value if the related business processes are changed accordingly.

• Integration of RFID capabilities with materials management/ERP systems for selected functions/activities is essential to capturing data on an accurate and timely basis.

Workflow process redesign incorporating RFID capabilities with financial and clinical systems can provide better visibility of equipment and stock movement and enhance the quality of patient care and safety. However, integration of RFID system capabilities with materials management workflow and process redesign with clinical and financial systems is essential to achieving successful outcomes.

With all of these potential benefits, the major concern centers on cost. George Morley, director of biomedical engineering at PinnacleHealth in Harrisburg, PA, commented last March that upon deploying a active RFID tracking system he obtained an ROI (return on investment) in "…less than a year."4 Mahoney’s RFID system focus addressed tracking in the equipment arena and did not consider all of the possible applications for this technology.

Mike Dempsey, the founder and chief technology officer for Radianse, a major RFID manufacturer/distributor, firmly believes that there are enough successful implementations of the technology to demonstrate accurate positive returns-on-investment. The technology is accurate, affordable and open. He claims the typical ROI analysis for a Radianse deployment shows the breakeven point for system costs and benefits is somewhere between 11 to 18 months.5

As previously noted, the DoD is actively pursuing benefits of RFID but has not yet implemented all of the capabilities of RFID. Concurrent with DoD activities, the Veterans Administration is developing a concept for a number of pilots within the hospital setting to enhance patient safety, and the Navy Fleet Hospital Three in Iraq is using RFID technology to track wounded soldiers, refugees and POWs.6 Many other medical centers are using RFID tagging and existing wireless networks to track moveable assets such as beds, IV pumps, as well as using passive RFID systems to provide infant tracking as part of an improved patient security system.

The big picture

The complexities of integrating RFID capabilities with the healthcare supply chain and existing legacy systems are considerable. Materials management personnel must work closely with information systems personnel to evaluate functions that can be enhanced by the use of this new technology and that will have a positive impact on support of patient care and patient safety. Completing the initial evaluation, identifying the potential outcomes and selling the concepts to senior administration are critical in building consensus among clinical and administrative staff prior to initiating system changes to incorporate RFID in routine operations.

The bottom line is that healthcare organizations are slowly adopting RFID technologies. This is not too surprising since there are still many areas within the healthcare environment where the benefits of bar code capabilities have yet to be fully realized. All of the recent case studies and literature on RFID systems adaptation has common threads … costs for the systems are decreasing, tracking of patients, supplies, equipment and medication is critical – especially for enhancing patient safety – and RFID is a viable solution. HPN

About the Authors:

Richard A. Perrin is president of AdvanTech Inc. and past chairperson for the HIMSS Supply Chain Management SIG. He is a nationally recognized expert in information systems focusing on IDNs, strategic planning and productivity enhancement. He can be reached at (888) 266-2841 or by e-mail at raperrin@advantech-inc.com.

M. Bess McAndrew is a senior management consultant at AdvanTech Inc., and leads the company’s activities in strategic technology assessment and reviews. She previously served as the military representative to the AHRMM Board of Directors and was assistant vice president of materials management at Washington (DC) Hospital Center after her retirement from the U.S. Navy. She can be reached at (888)266-2841 or by email at mbmcandrew@advantech-inc.com.

References:

1. Source: Tom Scharfeld, Research Manager, MIT Auto-ID Labs.

2. Study: Passive RFID not ready for prime time in healthcare, Healthcare IT News, Monegain, Bernie, September 12, 2005.

3. Feature from Microsoft Healthcare Web Log, Bill Crounse, M.D., global healthcare industry manager for Microsoft – "RFID: Increasing patient safety, reducing healthcare costs."

4. "Turning in to RFID," Healthcare IT News, Goth, Greg

5. Information abstracted Radianse’s Web site: http://www.radianse.com/overview.html

6. Presentation at AHRMM 2006 Conference, Col. K. Erickson, program manager for DMLSS.

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Making a convincing business case for RFID