Named one of America’s safest hospitals by Forbes Magazine in 2009, North Memorial has an ongoing commitment to delivering high quality patient care. One way that they have been able to sustain this promise is through their asset management program.

You may be surprised to learn that many operational, clinical and financial challenges faced by hospitals are rooted in inefficient asset management.

North Memorial was looking for a way to better manage and effectively utilize the infusion therapy equipment in its inventory. Nurses were frustrated that they had to waste time looking for equipment instead of focusing on their patients. In some cases, they turned to hoarding good infusion pumps so that they wouldn’t have to search for equipment when they needed it. With equipment difficult to locate, materials management staff did not have a true sense of inventory and there was a growing perception that there just wasn’t enough equipment to go around. In reality, the hospital was only utilizing 40 percent of its medical equipment.

North Memorial realized that inefficiencies in equipment management were not only impacting the hospital’s productivity and operating costs, but they could potentially have negative repercussions for patient safety. Like most hospitals, North Memorial is concerned about keeping its infection control rate low and preventing patient-to-patient infection transfers. This is all part and parcel of being able to offer high quality patient care, but with reimbursements no longer provided for healthcare acquired infections, hospitals all around the country are more concerned than ever about infection control and prevention. North Memorial was concerned that improper cleaning and servicing of equipment could lead to patient infection and that patient care would suffer because of equipment-based therapy delays and extended stays. Furthermore, all of these repercussions could result in financial implications for the hospital, another deep concern.

North Memorial approached Universal Hospital Services (UHS), an equipment-based solutions provider, for its Asset Management Partnership Program (AMPP). A team of UHS employees was established within the hospital to provide and manage its entire infusion equipment inventory. UHS created a process for managing the equipment, from logistics and tracking to cleaning, servicing and compliance. UHS used its proprietary software to keep track of equipment at all times and ensure that patient ready equipment was always available when needed.

UHS assisted North Memorial with equipment optimization and improved utilization of equipment in its inventory. Together, UHS and North Memorial implemented a hybrid model that combines purchased and rented equipment. North Memorial purchases enough equipment for normal usage and then rents for peak need. This enables them to be flexible according to volume and avoid over-using capital.

"We decided to rent all of our infusion equipment instead of purchasing it because we were concerned about technology obsolescence and the effort required in managing it," said Rich Mencel, director of materials management, North Memorial. "We saw no value in owning this equipment and realized we could avoid significant capital expenditure associated with technology upgrades."

The asset management program has enabled North Memorial to overcome operational, financial and clinical challenges. "Streamlining equipment management has eliminated potential risks to patient safety and improved overall patient outcomes," said Mencel.

The overall equipment utilization rate has increased from 40 percent to more than 70 percent. Instances of nurses hoarding equipment have decreased significantly because nurses are able to access equipment when they need it. "Nursing staff can now focus on their patients instead of hunting for equipment," said Mencel.

The number of infection transfer violations remains extremely low. This not only enables North Memorial to stand by their high quality care mantra, but it has also led to positive financial implications. When a hospital operates efficiently, patient turnaround time decreases and they don’t have to worry about lost reimbursements due to hospital acquired infections. "Equipment is cleaned and sterilized in between uses, serviced and delivered in sanitary, patient-ready condition, eliminating the risk of patient infection," said Mencel.

Furthermore, implementing the hybrid purchase/rent model for equipment has helped North Memorial avoid about $6 million in capital expenditure and save $939,342 in equipment repair costs over the last 6 years.