Add specialties. Purchase capital equipment and start performing new procedures. Expand the existing physical space and build additional operating rooms.
These are some of the common recommendations made to ASCs about how they can grow their bottom line. But a frequently overlooked suggestion, and yet one of the most successful, does not require ASCs to spend more. Rather, it requires them to spend smarter.
By improving inventory management, ASCs can reduce their costs — possibly quite significantly. Here are six steps surgery centers can take to help achieve inventory savings.
1. Provide staff with appropriate training and resources
Every member of your team involved in the inventory management process should receive training on their roles and responsibilities. Do not assume that staff will know how to perform any of their tasks. Even small mistakes can lead to irresponsible purchasing, lost inventory, and other unnecessary expenses.
Monitor their efforts carefully, correcting mistakes when observed. Then re-monitor efforts to ensure staff properly perform the corrected actions. If staff struggle with one or more areas of their inventory responsibilities, consider creating "cheat sheets" they can use to verify that they are performing tasks appropriately.
2. Use your inventory module to its full potential
Most ASC management software includes an inventory module that can greatly help with inventory management. Yet, ASCs often don't use the module at all, only partially use the module, or fail to keep the information in the module current. If your ASC falls into any of these categories, consider using the software that your ASC invested in to its full potential. Doing so will reduce inefficiencies that can cause unnecessary spend.
3. Watch for avoidable expenses
There are many avoidable ways ASCs can waste money. Any time you can eliminate one of them, that's a win for your ASC's bank account. Examples of waste include a drop shipping charge due to a last-minute order, penalty associated with late payments, rush delivery fees, and purchasing from a non-contracted vendor.
4. Keep pricing in the spotlight
If your ASC tends to discard a lot of supplies because they are opened but never used, draw attention to the cost of these supplies. Put pricing on storage bins. Include pricing on preference cards. Hang up posters reminding staff about the cost of those items most frequently discarded. Provide training specific to pricing. Consider emulating some of the games in "The Price is Right" to help reinforce training in an enjoyable fashion.
5. Shop around for a GPO
Group purchasing organizations (GPOs) can help ASCs achieve purchasing savings and efficiencies because they aggregate purchasing volume and then use this leverage to negotiate pricing discounts. But not all GPOs are the same. Differences can include pricing (some have no annual fees), manufacturers on contract, and services offered. Even if you have a good relationship with your GPO, it's always worth examining what other GPOs may offer.
GPOs often offer services — sometimes complementary — that can help your ASC save money beyond the volume discounts. As the Healthcare Supply Chain Association notes, these can include "… data analysis and benchmarking, innovative technology integration, market research, emergency preparedness, and natural disaster response." Determine what services your GPO offers and see if they may be worthwhile, perhaps to replace a service you are currently paying for.
6. Limit storage locations
As your number of supply storage locations increases, so does the potential for supplies to be misplaced and eventually expire. When considering adding a new storage location, determine if it's truly worthwhile. Staff will often request a new location for convenience. Weigh that convenience against potential risk.
If you add a new location, implement rules and processes to help ensure supplies always go to their appropriate locations (a worthwhile rule if you have multiple locations). During the initial few months that staff are using the new storage location, audit the location regularly to assess whether the appropriate items are going into it. Staff may start putting other items into the new storage area if it's convenient for them rather than return the items to a now less-convenient location.
To learn about building an ASC inventory system, the supply chain management process, and what's required to ensure inventory processes are used efficiently, attend my ASCA 2019 Winter Seminar session "Inventory Management," scheduled for Friday, January 18, 2019, from 4:10pm–5:10pm. You can also hear me present earlier in the day on "Taking the Infection Preventionist Seriously" from 1:50pm–2:50pm.
