SURGICAL/CRITICAL CARE
In addition, the procedural data was analyzed and as a result, a bill of materi- als (BOM) was created for McLeod’s total joint procedures, with supplies used by each surgeon in each case. This gave the health system a baseline for supply stan- dardization efforts.
“Some really phenomenal insights came from that,” said Dr. Michael Rose, Chief Innovation Offi cer, McLeod Health. “The variation in materials going into a case was unbelievable. We were able to defi ne about 10,000 combinations of products used among nine or 10 surgeons in total joint procedures.”
The revelations were eye-opening. “Docs were seeing this for the first time,” Denton noted. “We used this data to work with suppliers on pricing with surgeons at the negotiating table. This opened up conversations with vendors.”
Uniting around teamwork One of the most unique aspects of McLeod’s CQO initiative was that it was physician-led. Many organizations have been working to establish clinically integrated supply chains where clinical and supply chain teams work together to improve cost, quality and outcomes. But physicians can be resistant to change, par- ticularly when they question the credibil- ity of the data presented by supply chain. The McLeod team realized that if they
were to enact real change in the health system’s total joint program, the orthope- dic team must lead the effort and decide what data was necessary to evaluate sup- plies and their impact on CQO. Supply chain would support the initiative by obtaining and validating the requested data, as would stakeholders from the fi nance, value analysis and quality teams. In essence, it was not only a healthcare supply chain transformation project but also a clinical and fi nancial transforma- tion project.
“This work was presented to our phy-
sicians with cost, quality and outcomes data together in one place,” said Carmen Winfi eld, Vice President, Supply Chain, McLeod Health. “It required close col- laboration between various departments. Supply chain would provide the cost of supplies, fi nance the reimbursement side and quality the patient outcomes. So that was our goal -- to put it all together so physicians could see the big picture and make evidence-based, data-driven decisions.”
Showcasing cost savings Physician preference typically plays a role in hip and knee implant product
selection. While one surgeon believes one manufacturer’s implant delivers the best patient outcomes, another surgeon believes another manufacturer’s product is superior. Because implant components represent a significant portion of the overall procedure cost, the McLeod team was particularly interested in knowing how these items impacted CQO. The inte- gration and analysis of this data would facilitate the linkage of specifi c products, or product combinations, to procedural costs and quality of care delivery. From there the orthopedic team could stan- dardize on those supplies that delivered the greatest value: Best outcomes at the lowest cost.
“Once we established this baseline, we wanted to utilize the data to test hypotheses or changes,” Denton said. “If we switch to vendor X and use their products because they’ve come back to the table and given us a better price, does that affect any of our outcomes or results? Or if we implement a new technology (e.g., computer navigations, robotics) how does that affect our cost structure and our outcomes?”
With new insights from the integrated
data set, the McLeod team uncovered signifi cant opportunities for product and process standardization, waste reduc- tion and contract optimization. Most importantly, they were able to base their decisions on what delivers the greatest value to their patients. Ultimately this work enables McLeod to have the fi nan- cial viability to continue to perform life- changing total joint procedures, which are critical to the health and livelihood of its patient populations, according to Dr. Rose. Further, they anticipate planned healthcare supply chain optimization ini- tiatives in the total joint service line based on the results of this work will drive signifi cant savings to the health system.
Looking forward The team has identifi ed which supply combinations yielded the highest qual- ity outcomes at the lowest possible cost. Armed with this information, they worked to establish a standardized bill of materials for each total joint procedure, meaning those items essential to a case. They were able to standardize procedure packs (e.g., total knee case) with supplies that would cover 85-90% of all cases, rec- ognizing there would still be times when a surgeon required a unique item based on patient needs.
“We’ve standardized a lot of processes
based on these insights,” Denton said. “We’ve questioned whether we should
use a specifi c medication or intervention in certain procedures. Then we looked into the data to fi nd the evidence to say, ‘We think it should be this and everybody should do this.’ And we have about a 95% compliance rate with those processes.” They also used the dashboard for enhanced healthcare supply chain man- agement, such as monitoring compliance with supply standardization for joint procedures.
Next, the team looked at implants. With implants having the largest price tags among supplies used in total joint cases, the McLeod team was particularly interested to know if implant choice (manufacturer/ brand) impacted clinical outcomes.
“As we look across all of this patient demographic data and we look at patients one year out, the joint itself does not matter,” said Dale Locklair, Senior Vice President, Planning and Facilities Management Group, who has since retired. “The data shows that in the hands of a skillful surgeon particular implants do not make a difference in the long run. We drew the conclusion that those supplies that we call ‘physician preference items’ in healthcare, really do not contribute signifi cantly to outcomes in total joint procedures at all.” While the choice of supplier and
implant did not have a signifi cant impact on patient outcomes, it did infl uence the cost of the procedure, explained Dr. Rose. But acquiring lower cost implants isn’t the only solution to improving fi nancial outcomes for the health system. “In the supply chain area, I think we’ve learned a couple of really important things. One is that the choice of the vendor is an important factor in the cost, no question about it. However, what we learned from this experiment is you can’t take enough expense out of the implant to make this line profi table, and it is unlikely to ever be that way. We also need to impact care outside of the hospital after the proce- dure, including complications, readmis- sion and length of stay.” Supply Chain’s Winfi eld emphasizes the data elements and value. “We have been discussing how we can leverage the data we have today on what the prefer- ence cards say versus what is actually used and done in the room. How can we create a more accurate preference card to say: ‘This is what our data says you should use versus what you did use’ and Here are the products you used that you did not plan to use.’ That’s going to be one of our biggest opportunities for savings.” HPN
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