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Keeping pace with the growth in this clinical area is a rapid introduction of new medical devices such as drug eluting stents (DES) used in cardiac care cases. In the last 4 years the cost of these medical devices has skyrocketed while their shelf life has diminished. A now popular drug eluting stent, for example, costs approximately $2,500 and has a shelf life of just 3 months. Now, one of the biggest challenges for these specialty procedure areas is to control the inventory costs of these high-value devices.

Mercy Medical Center, a full-service, 917-bed Catholic Hospital located in Des Moines, IA, has found a solution. After searching for an automated means to track these high-cost, high-turnover products, Mercy was introduced to WaveMark Inc, by one of their vendors, Edwards Lifesciences. WaveMark offers a clinical inventory management solution (WaveMark CIMS) that utilizes RFID technology to track inventory and usage of these devices in real-time. By employing automated RFID technology, WaveMark CIMS is able to monitor the disposition of products including the in and out flow from storage cabinets, along with the capture of products used for a particular procedure.

‘When the Edwards rep came in and told me there was a way to automatically track inventory, I said, it’s about time!" said Lynda Wilson, Mercy’s administrative project analyst. Wilson had long suspected they were carrying too much inventory, but didn’t have the confidence in the available inventory counts to support a recommendation to reduce current levels. She also longed for a way to identify items that went missing, or were not properly accounted for, resulting in a loss in revenue, as well as an increase in expenditures. Not to be overlooked was the importance of efficiently managing expiration dates of these new medical devices, along with the swiftness of responding to FDA or manufacturer recalls.

Inventory report with Edwards products showing on hand status compared with Target Inventory

How it works:

WaveMark CIMS is a web-based solution providing hospitals with complete visibility into their inventory. To collect and make this information available, WaveMark installs RFID enabled cabinets in the hospital to store and track all products. Each product box is tagged with a passive 13.56 MHz RFID tag complying with the ISO 15693 standard. The intelligent cabinets have built-in RFID interrogators that read items on the shelves every 18 minutes and feed the data to the WaveMark database. To capture product usage, point-of-service (POS) RFID readers are placed in the control room, or wherever the documentation of cases is done. The data is collected on a continuous basis, providing near-real time information accessible from a web browser.

Mercy Medical Center is a member of the Catholic Health Initiatives (CHI), a nation-wide integrated delivery network of 70 hospitals. The Mercy Cardiac Cath Lab is among the largest in Iowa, encompassing 6 rooms and offering the most sophisticated cardiac and peripheral vascular treatments available today. Prior to WaveMark, over 2,000 items were hand-counted every morning, compared against par, and product requisitions entered into the Materials system for transmittal to vendors. This took about two and a half hours every morning and because of its manual nature, was prone to errors. Now that the cabinets are counting, Mercy has saved roughly 400 man-hours annually. In addition, Mercy uses WaveMark to analyze product usage patterns, find expiring products, resolve missing items, and set par levels that match usage.

WaveMark works very closely with each hospital to determine the number of intelligent cabinets needed, along with the quantity and location of Point of Service readers to capture usage for proper patient billing. Together, WaveMark and the hospital determine the ROI opportunity, thus outlining the strategic benefits of the solution to hospital executives. Since WaveMark CIMS is offered as a service, installation and maintenance is performed by the company saving hospitals from capital expenditures and set up fees.

As a six-sigma black belt, Wilson is used to analyzing data to make recommendations for hospital improvements. With reviewing process flows as a critical component of those recommendations, Wilson was ecstatic to experience the hands-free nature of WaveMark CIMS data capture. Since WaveMark CIMS eliminates the manual time and errors associated with counting inventory, current work flows were streamlined, freeing nurses and techs to focus on patient care. The installation of WaveMark CIMS in Mercy’s 6 room Cath Lab has given Wilson the information necessary to derive the cost of a procedure, extract information on product turns and consignment reconciliation, as well as audit the inventory process. "I look at things differently all the time. WaveMark provides the info and I slice it and dice it as I need," offered Wilson.

Nancy Turner, inventory manager in the Cath Lab, registering tags into WaveMark

Patient safety gains

In addition to real-time visibility, WaveMark CIMS helps hospitals address patient safety concerns that come with FDA recalls and managing high value consumables with limited shelf lives. With real-time visibility of product inventory, hospital staff can quickly identify and properly rotate products by expiration date. At the same time, the exact location of a recalled product can be identified by tracking its unique identifier for prompt removal of the product before it ever has a chance of making its way to a patient. The speed and ease in which expired or recalled product can be managed provides nurses and technologists with peace of mind that they will always have the right products at the right time. RFID’s ability to track product usage and defective items also provides critical product replenishment information ensuring doctors always have their preferred items for every procedure.

Hard dollar savings are critical to any business environment and none so more than financially strapped institutions such as hospitals. WaveMark CIMS has provided Mercy Medical with the financial returns they were counting on. After a 5-month evaluation, the analysis showed a net reduction in inventory opportunity of 24% or 457 items, representing a total possible savings of over $250,000. Furthermore, the review of product usage as compared to patient billing identified an opportunity in reducing missed charges of several thousands of dollars per month. Having access to data and utilizing the decision support tools such as par level tracking, bulk buy optimizer and replenishment reports, WaveMark CIMS is providing Mercy with the information to make informed decisions on how best to manage the complex inventory needs of a busy Cath Lab.

In just six months, Mercy Medical Center has realized returns they only dreamed of before WaveMark. With early analysis showing real savings combined with solid revenue opportunities, the groundwork is in place to expand beyond the Cath Lab to specialty areas such as the EP lab and Radiology. The return on investment also supports a larger commitment to integrating WaveMark into their materials and patient billing systems to streamline these processes even further.

"WaveMark provides huge value to us — it’s information at your fingertips—without having to do it manually. This is exactly what healthcare needs," concluded Wilson.