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VHA IDNs to FDA: Mandate UDI integrated with GS1, along with EMRs

Mike Duke

And at press time in early January, most from the same group of integrated delivery networks (IDNs) further called on the federal government to mandate the use of GS1 data standards with the same fervor as they promote electronic medical records (EMRs) as ways to improve operational efficiencies and reduce healthcare costs.

In fact, VHA officials advocated that GS1 data standard requirements for supply chain transactions "would cost far less to advance" than EMRs, which should motivate additional federal financial support, according to Mike Duke, VHA’s senior director, national supply chain services.

"Our position is that the adoption of GS1 standards should be an important target in the government’s quest to drive healthcare efficiency; therefore, we believe it is worthy of additional federal financial support," Duke indicated. "With a very small investment, the government could enable the industry to support education and communication efforts related to standards adoption. The cost would be minimal compared to the value. These efforts would help the industry tackle the billions of dollars that are wasted in healthcare annually as a result of the lack of data standards in the supply chain arena."

Fourteen of 19 systems belonging to VHA’s Large IDN Supply Network (LISN) demonstrated their support of the two consecutive efforts to convince the FDA to take a harder line on healthcare product data standards. The LISN members account for roughly 20 percent of VHA’s annual purchasing volume. They include Allina Hospitals & Clinics, Minneapolis; Baptist Memorial Health Care Corp., Memphis, TN; BJC HealthCare, St. Louis; Cedars-Sinai Health System, Los Angeles; Mayo Clinic, Rochester, MN; MedStar Health Inc., Baltimore/Washington, D.C.; Memorial Hermann Healthcare System, Houston; Novant Health, Winston-Salem, NC; OhioHealth, Columbus, OH; Premier Health Partners, Dayton, OH; Providence Health & Services, Renton, WA; Sentara Healthcare, Norfolk, VA; Spectrum Health, Grand Rapids, MI; and Yale-New Haven Health Services Corp., New Haven, CT.

While the initial push focused on pairing the GS1 standards to the UDI initiative, VHA felt that the emphasis on EMRs as a healthcare reform strategy highlighted by the Bush and Obama Administrations as well as a multitude of healthcare industry players, made for an equally opportunistic hook.

"Rightly or wrongly, people are arguing about the financial benefits of implementing EMRs, even though cost reduction shouldn’t be a primary rationale for implementing systems," Duke noted. "There is, however, no argument about the financial benefits of GS1 data standards and, as the momentum for EMRs continues, full implementation of these data standards would provide the needed foundation for reliable and interoperable material aspects of EMRs. These standards and others will drive the efficiency that we are desperate for in healthcare."

Reducing costs, eliminating waste and improving quality and safety are among the reasons why the LISN organizations urged the FDA to push for a single set of data standards for devices even as the federal agency has resisted taking the need for standards as far as endorsing, recommending or requiring a specific system.

Duke certainly understands the pressure facing the FDA because he’s attended a number of conferences where FDA’s liaison on product data standards, Jay Crowley, senior advisor for patient safety, presented and reiterated the federal agency’s official position, which seemed to fall short of audience expectations. Many healthcare organizations struggle with a desire for the FDA to take a tougher stance on one hand but fear long-term repercussions of more government regulations on the other.

"But if there’s no standard then there’s no standard," Duke told Healthcare Purchasing News. "So there’s no adoption and more confusion. Certain stakeholders believe GS1 should happen. They’re clearly behind this. They feel they need to take a stand and show the FDA that $7 billion in [purchasing volume] is committed to a single standard and GS1. The industry has got to start moving in that direction."

Duke expressed frustration that the FDA’s reticence to recommend a specific set of data standards, as well as the overall industry’s lack of momentum and motivation for a single set of data standards, is stymieing further progress on such projects as the UDI.

"Unless [intervention] happens it will jeopardize implementing of UDI," he said. "The industry will just ask for extensions and delay implementation. It will just be another excuse."

Duke acknowledged that UDI’s passage will take time, as well as the funding and systems integration for it on a facility level. "Imagine having a great [electronic medical record system] and still keying in lot numbers," he added. "This has to be seamless and integrated. Until UDI passes as law, and the industry coalesces around it, none of it will begin."

One of the titular complaints about adopting and implementing supply data standards is that some of the software solution providers admittedly don’t have usable fields to handle the standards, according to Duke, who called it "another great aha! moment" as the industry faces sunrise dates in December.

"These sunrise dates are important," he said. "We needed them because they created a lot of energy and enthusiasm. But solutions providers aren’t ready and providers are looking for [return on investment]. It’s the chicken-and-egg thing. If we’re not able to make the sunrise dates, and I don’t think we will, then what? That’s okay. But let’s start talking about it now. There are a number of organizations doing some hard work on this but they’re only chipping away at it. Let’s be real about it. What happens in January 2011? It seems like hallway discussions are becoming more relevant about this issue than the actual meetings about this issue."

Duke also doubted that value-added networks or VANs, which were third-party software products that translated data from disparate systems made popular during the open electronic data interchange (EDI) era of the late 1990s, would bridge the gap. "These translators for UDI would simply add another layer for implementation," he said. "Distributors and providers would need systems that could switch between the two of them. This adds costs and complexities to the process."

Duke underscored the need for targeted discussions. "We need to create and sustain visibility around this issue," he said. "We need to implement standards."

As one example, Duke cited the retail industry as having "sophisticated supply chain management systems that incorporate data standards," enabling more efficient and effective flow of information and materials.

"The grocery industry didn’t all of a sudden start this process by saying they needed to standardize on bar coding. They started seeing all of these long lines at the checkout counters where cashiers would have to hold up each item and key the codes into the cash registers. Complaints from customers did it."

The healthcare industry, which severely lags behind other industries, needs a more unified system to track supplies and their accelerating costs, according to Duke. Adopting GS1 standards, he added, will mean "less confusion in ordering, shipping and pricing creating more efficient connections and systems."

"We’re urging the administration, through the FDA and other channels, to mandate adoption of GS1 standards," said Joseph Dudas, director of accounting and supply chain informatics, Rochester, MN-based Mayo Clinic, a VHA member. "This would accelerate implementation via prioritized support of the standards, energizing the industry’s focus on GS1, just as the government has done for electronic medical records. If the government would demonstrate more aggressive support for GS1 standards, manufacturers and hospitals could move more confidently and swiftly to make changes in their operations and information systems to prepare to use and implement them."

Duke contended that meeting the December 2010 sunrise date for GS1’s first wave of adoptions "depends on the solutions providers as the lynch pin.

"We’re working with a lot of members to gear up for this with a few suppliers," he continued. "But if you can’t put numbers in the system and use it widely – beyond pilot projects – adoption and implementation will be limited in December 2010. Major software companies have to be ready before suppliers can do it. Readiness is not there. We have to see where everybody’s at."