Three healthcare systems learned first-hand how Supply Chain can help their Laboratory departments cut costs and generate savings without compromising high-quality patient care. Here’s what they did, how and the outcomes.
Akiva Faerber, Senior Principal, Vizient Inc.
Who: Cooper University Health Care is the leading academic health system in South Jersey. Cooper includes South Jersey’s only Level I trauma center (Cooper University Hospital), a leading cancer center (MD Anderson Cancer Center at Cooper), the only Level II pediatric trauma center in the Delaware Valley (Children’s Regional Hospital), one of the largest physicians group in the region, four urgent care centers, and more than 100 outpatient offices throughout South Jersey and Pennsylvania.
Throughout 2017 and into the first months of 2018, Cooper University Health Care was inconsistently receiving required blood products to meet routine needs and in emergent situations. Their Supply Chain leader asked Vizient Advisory Services to work with the lab and perform an analysis to understand current challenges and define their technical and operational needs. After the analysis, Vizient then assisted them in putting together an RFP that would enable them to assess interested suppliers and select one that would insure consistent supply, improved service and reduced costs.
What area(s) in the facility’s Laboratory department needed help to control and manage costs/expenses? They needed assistance with blood sourcing, therapeutic apheresis and with sourcing a blood bank reference lab-testing provider.
How specifically the facility’s Supply Chain department helped the Laboratory control and manage costs/expenses? The Supply Chain leader in collaboration with the consultant subject matter expert led efforts to assess and validate current supplier performance versus the technical and operational needs of the Lab department. The Supply Chain leader in collaboration with the consultant subject matter expert then led the RFP development process that identified a new vendor and improved price and terms and conditions.
What results the Laboratory department achieved with Supply Chain’s help? Achieved savings in blood sourcing $358,000, therapeutics apheresis $52,000 and lowered clinical reference lab testing costs by $378,000.
Brent Bolton, CPSM, Regional Director, Supply Chain, Accumen Inc.
Project: Implementation of onsite Heparin Induced Thrombocytopenia (HIT) testing to improve test turnaround time, therefore improving patient care by reducing patient length of stay and lowering numerous expenses in the laboratory, hospital and pharmacy.
Key professionals: Dr. Anand Kunda, Pathology Medical Director, Sharp HealthCare, San Diego; Albert Rizos, Pharm.D., BCPS, Manager, System Clinical Pharmacy Services, Sharp; Brent Bolton, CPSM, MBA, Regional Director, Supply Chain, Accumen
The test: CPT Code 86022.
Test Description: Heparin-Induced Thrombocytopenia Abs PF4 (HIT) is a complication of heparin therapy. There are two types of HIT. Type 1 HIT presents within the first 2 days after exposure to heparin, and the platelet count normalizes even with continued heparin therapy. Type 1 HIT is a nonimmune disorder that results from the direct effect of heparin on platelet activation. Type 2 HIT is an immune-mediated disorder that typically occurs 4-10 days after exposure to heparin and has life- and limb-threatening thrombotic complications. In general medical practice, the term HIT refers to type 2 HIT. HIT must be suspected when a patient who is receiving heparin has a decrease in the platelet count, particularly if the fall is over 50 percent of the baseline count, even if the platelet count nadir remains above 150 x 109/L. Clinically, HIT may manifest as skin lesions at heparin injection sites or by acute systemic reactions (e.g., chills, fever, dyspnea, chest pain) after administration of an intravenous bolus of heparin.
Old testing method: Sharp HealthCare, like many hospitals, generally has a low volume of patients who test positive for Heparin-induced thrombocytopenia. For most patients (~95 percent) test results come back negative. The problem is that until the test results come back, at-risk patients are placed on the intravenous drug argatroban, which is expensive, typically costing about $1,000 per day per patient. In 2016, Sharp HealthCare sent over 400 HIT tests to their primary reference lab, costing $45 per test. The test had a 20-hour turnaround time once received by the lab. With courier expenses and transit time also included in the process, the average turnaround time was estimated to be 24 hours. The cost of performing this test at the reference lab amounted to more than $20,000 annually. In addition, Sharp HealthCare spent $178,285 on the drug argatroban.
New testing method: The medical staff at Sharp HealthCare determined that by improving test turnaround time there would be a decrease in laboratory and pharmacy costs, as well as improvements to patient care. Working in partnership with Accumen supply chain, the team reviewed ELISA methods of performing the test. This method would improve the test turnaround time to less than 6 hours, which would result in an 18-hour improvement. Accumen negotiated with various instrumentation vendors and found an HIT kit suitable for efficient testing by the laboratory staff and a high-quality result required by the Medical Director. It was determined that by improving the test turnaround time that some patients may no longer need the 250 mg vial of Argatroban, and instead only need the 50mg vial. The savings forecast included the cost savings from the 250 mg vial versus the 50 mg vial, estimated at approximately $620 per patient or $78,200 per year. Both the Sharp Healthcare Medical Director and Manager of System Clinical Pharmacy Services agreed that therapeutically this would be a great step forward to minimize the complications and risk of argatroban infusions and the use of other, less well-studied meds, such as fondaparinux or rivaroxaban. After a full year of performing this testing in house, the actual cost of argatroban was only $66,806, which exceeded the original cost savings expectations and resulted in $111,479 annual savings in argatroban.
Next steps: Sharp and Accumen continue to search for ways to improve processes and patient care while reducing costs. In January 2018, Sharp recently transitioned this testing to an automated coagulation analyzer, which has the capabilities to perform HIT testing in minutes. Accumen was able to negotiate a reagent cost savings on the automated products, while the new analyzer will improve the test turnaround time to just a few minutes. By automating this test, many patients will never have to be given the 50 mg vial of the drug argatroban, which will improve patient care while also decreasing costs.
Suzanne Meinert, JD, MT (ASCP), Contract Manager, Laboratory, ROi
What: ROi worked extensively with one of our member IDNs over the course of several years to standardize testing methodologies in all major areas of the lab. While this resulted in significant savings for all standardized areas, the laboratory has growing concerns relating to changes in reimbursement as a result of PAMA, and continues to look for additional opportunities to contain costs. The lab identified point of care coagulation testing as a particular pain point and sought ROi’s assistance in assessing options for more cost-effective options in this supply area. Staying with the current methodology was the preferred option as a conversion to a competitor would require significant time and resources.
How: Pursuing a solution directly with the manufacturer of the lab’s current methodology was not fruitful, so ROi worked with a preferred distributor partner to find a solution that would allow for enhanced pricing for this particular point of care test. Partnering with this distributor resulted in a 5 percent savings opportunity for one single SKU, thus resolving the lab’s concern over cost in this testing area, as well as preserving the lab and IT resources that would have been required for a conversion to a competitive product.