The medication barcode rule was created after the Institute of Medicine’s 1999 To Err is Human report, which found that as many as 98,000 people die in hospitals each year as a result of preventable medical errors. The rule mandated that certain human drug and biological product labels contain a bar code consisting of the National Drug Code (NDC). At the time, the FDA looked into creating a similar rule for medical devices, only to find that there was not a comparable standard identifier, like the NDC, for devices. That set the wheels in motion for inclusion of language mandating UDI in the FDA Amendment Acts (FDAAA) of 2007.

While UDI was originally envisioned for patient safety purposes, the FDA has recognized that having a standard way to identify products can serve other purposes, from improved supply chain efficiency to better visibility into the products used in patient care. For example, by capturing the unique identifier in electronic medical records, clinicians could identify if a patient has a specific implant. This information would be highly valuable for emergency responders transporting a patient to the hospital or for surgeons prior to performing revision surgery. But that value only comes if providers are prepared to use the identifier.

There are a number of federal initiatives underway that could accelerate, if not require, provider use of unique device identifiers in the future. The FDA is studying, as part of its Medical Device Epidemiology Network Initiative (MDEpiNet), the role UDI can play to understand the safety and effectiveness of medical devices after they are marketed. The FDA and the Office of the National Coordinator for Health IT have also been in discussions about requiring capture of UDI codes in electronic medical records as part of a future stage of meaningful use, while the Centers for Medicare and Medicaid Services has talked about requiring the UDI for certain reimbursement claims.

Whether required or not, under healthcare reform, providers will need to have a better understanding of the products they use and the role they play in enhancing patient care while lowering costs. UDI can assist with product data capture at the point of use (POU), which, in turn, can help providers determine total costs per procedure, increase billing accuracy and improve inventory management. By sharing POU data with suppliers, providers can collaborate with trading partners on demand planning and potentially reduce the costs associated with expired, excess and obsolete inventory.

But UDI is only part of the puzzle. To achieve value, providers need technology in place to capture the identifiers and share them with the various internal clinical, supply chain and financial systems, as well as with their suppliers.

Suppliers, meanwhile, have a significant amount of work to do to prepare for the final UDI regulation, which could be published as early as May 2013 based on timeline requirements in the recently passed FDA Safety and Innovation Act. The UDI rule will first impact manufacturers of Class III devices, which include replacement joints, spinal implants, implantable cardioverter defibrillators, pacemakers and stents. According to the proposed rule, they would need to comply within 12 months after publication of the final rule (May 2014). Class II devices will likely need to be in compliance in 2016 and Class I devices in 2018.

Suppliers, too, can achieve broad value from UDI. Siemens Healthcare Diagnostics recognized this as it undertook an initiative to standardize how its products are identified through use of GS1 Global Trade Item Numbers (GTINs) and to share that data with worldwide trading partners using the GS1 Global Data Synchronization Network® (GDSN®). Instead of simply implementing standards to meet specific regulatory or market requirements, Siemens took a holistic approach by examining how global data standards enablement might improve its internal business processes, as well as its interactions with global trading partners and customers.

GTINs are one of the ISO 15459 standards that the FDA will accept as a unique device identifier; another is the Labeler Identification Code (LIC) administered by the Health Industry Business Communications Council (HIBCC).

"Standardizing product identification with GTINs touches every part of our company, so we had to carefully evaluate the impact it would have and the work that needed to be done to make it happen," said Dietmar Hein, director of e-commerce for Siemens Healthcare Diagnostics.

Volker Zeinar, a consultant to B. Braun Melsungen AG on global coordination of auto id affairs, also recommends a more enterprise approach that includes cross functional teams, strong project leadership and executive involvement to meet the requirements of the three parts of the FDA’s proposed UDI system:

1. UDI code with two parts:

2. UDI database (UDID) that contains information associated with device identification and labeling

3. Automatic Identification & Data Capture (AIDC) carrier, e.g., linear barcode, 2D barcode, RFID, at all packaging levels that contains the device identifier, and if applicable, the production identifier.

Zeinar says each of these correspond to areas of work for manufacturers. For example, in order to allocate UDI codes to products, manufacturers need to become a member of an ISO 15459 standards organization, e.g. GS1 or HIBCC, and determine which products require a code and at which packaging levels, e.g., case, box, each, etc. Suppliers also need to develop processes and policies around assigning and maintaining those codes and make sure their ERP system(s) can hold the codes.

Labeling products provides another layer of complexity, with questions ranging from whether existing labels have the required space for the codes to whether existing print technology can handle adding data that changes, such as the production identifiers. Something as simple as paper that is too translucent, making it difficult for scanners to read the data can jeopardize compliance.

Manufacturers also need to determine which product attributes will be required to populate the UDI database and where the data resides in their organizations and who owns the data. As more UDI regulations are issued around the world, manufacturers will need to populate multiple UDIDs with different requirements. The U.S. FDA is currently conducting external User Acceptance Testing (UAT) with a few key partner organizations to help it understand whether the UDID design works as intended and meets the needs of users, to identify any issues or problems, and to gain feedback on the processes needed to interact with the system. In the future, the FDA will test how healthcare providers and others can access data from the UDID.

With UDI regulation on the horizon in the U.S. and other countries, more suppliers are embarking on the process outlined above. Many leading provider organizations are also beginning to prepare for UDI. A prime example is The Ohio State University Wexner Medical Center, where the chief supply chain officer, Rosalind Parkinson, has been educating her CFO about UDI. As a result, now that the proposed rule has been issued, she anticipates receiving funding to begin making some the necessary upgrades to her ERP system to help her capture and use the UDI codes.

By preparing now, and taking a more holistic approach across their organizations and across the entire supply chain, providers and suppliers can help ensure healthcare can maximize the return on the investment required to implement UDI.