Industry expert helps Ambulatory Surgery Center (ASC) regain control
over inventory, and overcome costly inventory management issues.
Specializes in minimally invasive orthopedic surgeries, foot and ankle
surgeries, and pain management
Unused inventory was negatively impacting profitability.
Inventory Management Assessment by ASC Advisory Services from SourceMed, now Surgical Information Systems (SIS)
Inventory management, also referred to as materials management and supply chain management, is crucial to the profitability of an ambulatory surgery center (ASC). Accurate and timely inventory management results in increased productivity and profitability. However, when inventory is not managed effectively, the impact can be financially and operationally devastating.
If inventory is not properly tracked, it is impossible to know if a case makes financial sense. Inventory management also helps facilities avoid needless cancellations and delays by ensuring all necessary supplies are readily available when needed.
Despite the significant impact inventory management can have on a facility’s bottom line, it is an area that is often overlooked because it is an onerous process. Hiring an ASC inventory management expert can help get a center’s finances back on track.
A seasoned ASC inventory expert will ensure proper processes and technology are in place to optimize the cost of acquiring and holding inventory, while satisfying a center’s requirements for keeping supplies on hand.
New Britain Surgery Center, located in Chalfont, PA, specializes in minimally invasive orthopedic and foot and ankle surgeries, along with pain management procedures. This busy center performs between 550 and 600 cases per month on average. New Britain is certified by the Centers for Medicare and Medicaid Services and the Accreditation
Association for Ambulatory Health Care.
The center opened its doors in 2011 without any inventory controls in place. There was no one person responsible for inventory oversight nor was there an effective line of communication between the administrator and materials management resource. Over time, this lack of oversight took its toll on the center and costs associated with unused inventory were mounting. In an effort to regain control, the center’s Board hired a new director to oversee the implementation of an inventory management system. Patricia Frendak was hired as the Administrative Director in 2015.
According to Frendak, “When there is no inventory oversight at a center, things can get out of control very quickly. This is especially true for a center as busy as New Britain. The sheer volume of supplies that sat unused at the center when I arrived was so large, there was no way to measure it (in terms of dollars).”
After researching inventory management system options, Ms. Frendak was made aware of an inventory management module within the center’s current clinical management software that was not being used. Rather than investing in a new solution, it made more sense to utilize the inventory management module within their existing system from SIS.
Realizing much work needed to be done, Ms. Frendak hired SIS Chief Nursing Officer, Ann Geier, MS, RN, CNOR, CASC to create a more efficient, accurate inventory management program. Before her arrival at the center, Ms. Geier participated in several phone conversations to provide guidance on what staff needed to do in advance of her visit. Using pen and paper, the team at New Britain methodically went from area to area tracking all supplies. Frendak’s advice to other centers, “Start inventory management at the beginning, before a center opens its doors. As we learned first-hand, it is challenging to put a system in place once a center is already functioning."
Once onsite, Ms. Geier conducted a walk-through of the facility, providing valuable advice and detailed tips along the way. Rather than simply stating the importance of having inventory in one location, Ms. Geier took the time to show staff what needed to be done. For example, suture carts were located in every operating room. While convenient for the center’s staff, the volume of unused inventory sitting on each cart was significant. At Ms. Geier’s suggestion, all suture carts were moved into a central location enabling the center to save a tremendous amount of money on sutures.
Ms. Geier also identified anesthesia supplies as a problem area, as the amount stocked in each room was far beyond what was needed. She offered an easy resolution to the problem, recommending that staff determine the average daily case number per room. If an average of 12 cases are done in a room each day, then 13 circuits (having one as a backup) should be kept, not 20.
Ms. Geier also provided valuable insights to help the center avoid future supply issues. In addition to communicating the importance of always having a back-up item for frequently used supplies, she offered thoughtful advice. For example, the center’s surgeons use a particular glove. Ms. Geier was quick to point out if the standard gloves are not available or become too costly, staff could not simply substitute them with any gloves. She recommended conducting a trial with surgeons in advance; surgeons should be asked to test the backup glove and sign off on them before the switch was made.
“Ann has a tremendous wealth of knowledge and is very easy to work with. She is able to draw on her vast ASC experience to provide tools and tips for an effective inventory management program. The level of detailed advice she offers is exceptional. She doesn’t just point out a problem, she offers solutions and ensures they will work for our staff and our patients,” says Ms. Frendak.
With the first stage of New Britain’s inventory management endeavor underway, additional work remains for the center’s team based upon Ms. Geier’s assessment.
The next stage involves vendor management. Rather than assuming consignment is not an option, Ms. Geier recommended pursuing consignment with one of the center’s biggest vendors. Additionally, staff at New Britain are in the process of reaching out to all their vendors to inventory usage. This information will be entered into a template provided by Ms. Geier and eventually uploaded into the center’s inventory management system.
The final stage involves a wipe of the center’s system to ensure the data within the inventory management module is clean and accurate going forward. After all of the inventory is loaded into the module, preference cards will be built. Ms. Geier will continue working with the team at New Britain to offer insight and advice to ensure inventory management success is achieved.
“While it is too soon to determine the cost saving achieved by regaining control over our inventory management, we expect the amount to be significant. In just a few short months we have seen so many positive changes in how our inventory is managed thanks to Ann Geier and SIS ASC Advisory Services,” concluded Ms. Frendak.
A lack of internal ASC-specific expertise was hampering the timely resolution of existing deficiencies at an established center.
An outside ASC expert was needed, within a short timeframe, to help review policies and procedures for Standards' Compliance in a new ASC.