In a recent webinar hosted by Becker's Hospital Review, two thought leaders from Cardinal Health discussed the regulatory and operational challenges associated with controlling costs and managing cath lab inventory.
Peter Mallow, PhD, director of health economics, outcomes research and reimbursement, and Jeff Porubcansky, director of trusted advisement for operations and services, explained how hospitals can leverage radio-frequency identification (RFID) automation and inventory data to better align cath lab inventory with clinical use and promote cost savings.
Dr. Mallow and Mr. Porubcansky discussed the impact on cath labs, a broad term for all cardiovascular labs associated with interventional radiology, electrophysiology, cardiac catheterization and neurology procedures. As cath labs handle many high-volume, high-value procedures, they represent an important area to monitor waste and rein in costs.
Inventory management challenges
Shifting reimbursement models represent one of the largest changes in the healthcare industry today. CMS is planning to have 50 percent of all Medicare provider payments fall under an alternative model by 2018, which includes accountable care organizations, patient-centered medical homes or bundled payments. Further, physician reimbursement under the Medicare Access and CHIP Reauthorization Act will not only be tied to value-based metrics, but also the financial performance of the cath lab.
"As payments come under pressure, health systems need to develop the infrastructure and capabilities needed to thrive in the emerging value-based payment and care delivery environment," said Dr. Mallow.
Healthcare providers must abide by various complex regulations surrounding quality, coding, reimbursement and overall care delivery, according to Mr. Porubcansky.
"While many of these regulations were designed to improve care and efficiency, they come with a high administrative burden," he said. A cath lab often operates under multiple reimbursement models — including Bundled Payments for Care Improvement, Medicare Advantage plans and unique commercial payer contracts — each holding different requirements for quality reporting. The cath lab is also responsible for determining which model applies to which patient.
Coinciding with administrative challenges associated with reimbursement is the growing trend of patients turning to alternative care settings outside of the acute care hospital. A recent HFMA Value Project Report on Strategies for Reconfiguring Cost Structure shows declining payments, increased customer exposure to healthcare costs through high deductibles and changes in healthcare delivery are all lowering utilization of higher-acuity settings, according to Dr. Mallow.
Data analytics as a solution
These challenges are forcing health systems to reconfigure their cost structures.
While every health system focuses on CMS' "triple aim" — better care for individuals, better health for populations and lower per-capita costs — Dr. Mallow says many health systems are adopting a fourth aim goal: staff satisfaction. Hospital leaders must provide the tools, data and resources to help their team members improve operational efficiency and reduce human prone errors.
"Now is the time to prepare for Medicare bundled payments and value-based care," said Mr. Porubcansky. "Arm your team with the tools and data they need to drive lower costs, increase clinicians' time spent with patients and boost employee satisfaction."
Data analytics, which offers end-to-end visibility, is key to optimizing efficiency for staff and controlling inventory supply management costs in the cath lab, according to Mr. Porubcansky.
Automated RFID inventory management and analytics allows hospital leaders to better predict, trend and analyze product utilization at every touch point along the enterprise, identifying areas to eliminate waste. The technology helps to ensure hospitals have the correct amount of cath lab inventory on hand and helps to prevent expired, obsolete or recalled products from staying on the shelves or mistakenly reaching patients.
"RFID can help you accurately document and capture charges at the point of use, including the unique device identifiers, which help you track and report implantables for registries and Meaningful Use Stage 3, all while streamlining your audit processes," said Mr. Porubcansky.
Data analytics also enables supply chain leaders to speak a common language with physicians to drive evidence-based decisions.
"By continuously tracking and collecting information about clinician preferences and product from receipt to use, you can gain a real-time view of objective data that you need to facilitate discussions with your physicians and share how those costs will be impacted with value-based care," said Mr. Porubcansky.
Strong data visibility and cost transparency not only helps hospital leaders better manage cath lab inventory, but also provides helpful processes to control costs related to value-based care.
To listen to the webinar recording, click here.
To view the webinar slides, click here.
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