Page 38 - DMGT525_MATERIALS_MANAGEMENT

Unit 3: Codification and Standardization

Self Assessment Notes

Fill in the blanks:
12. Standardization enables the materials manager to achieve overall economy and ensures
……………… of parts.

13. The process of standardization leads to simplification or………………… .
14. ………………….. helps reduce inventory items.
15. ………………… could also be used in advertising for the products as well as spare parts.

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Case Study Data Standards in the Supply Chain

nterested in cutting costs and improving patient safety? Visit your organization’s
supply room or station and take a product from the shelf. Ask your materials
Imanagement director if the product’s origins can be traced. Can the item’s contracted
price be captured from the packaging bar codes? In a product-recall situation, could all of
the affected items throughout your health system be located quickly and accurately?
The likely answer is “No.”
Lack of data standards in the healthcare supply chain make it difficult to track and trace
products, creating inefficiencies that raise cost and impact patient safety.
“Today we don’t know if a product has been used and on which patient,” says Jean Sargent,
past president of the Association for Healthcare Resource & Materials Management. “It’s
a significant patient safety issue.” For instance, Sargent says, data standards will streamline
the recall process. Organizations will be able to identify and trace recalled products and
remove them promptly. In the case of certain medical devices, hospitals will be able to
track which patient received a recalled product and proceed accordingly.

Bar-code technology has been in place for more than 35 years, but healthcare has resisted
adopting it. “I came to healthcare seven years ago and was shocked that we couldn’t use
bar codes on products,” says Brent Johnson, vice president of supply chain and imaging
services and chief purchasing officer at Intermountain Healthcare, Salt Lake City. “The
healthcare supply chain is complex and costly. The No. 1 problem is not being able to use
data standards and product identification information.”
One of the challenges has been a lack of perceived value in standards adoption. That’s
changing. “Hospitals now see clearly the need for data standardization,” says Siobhan
O’Bara, vice president of healthcare for GS1 Healthcare U.S. in Lawrenceville, N.J. “The
need is even greater under health reform. It’s driving the demand for standardization
higher and higher.” Data standards will help to ensure that hospitals get the right product
in the right quantity to the right place at the right time and at the right (or contracted)
price.

The onus is on providers. “We haven’t demanded standards adoption and we have a
credibility issue with the use of supply chain information,” says Vance Moore, senior vice
president of operations for Sisters of Mercy Health System in Chesterfield, Mo. Sisters of
Mercy, along with Geisinger Health System, Intermountain Healthcare, Kaiser Permanente

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