By Jim Salmons
Assets in the healthcare environment represent a significant expense to any organization, second only to labor costs, according to AAMI statistics. Therefore, it came as no surprise that one of the highlighted trends from AAMI 2016 relative to HTM was on optimizing the cost of medical equipment as healthcare systems operate under increasingly shrinking budgets and providers attempt to save costs.
Unfortunately, for many healthcare organizations, effective asset management is often a stumbling block as they mull taking services in-house or expanding their in-house program. As a side note, a series of international standards for asset management (ISO 55000/01/02) was introduced in 2014, which were intended to unite organizations worldwide behind a common framework for asset management. But that’s a topic for another time.
Although it may seem like common sense, at the core of effective asset management is an accurate inventory, including location, service history, and related costs for each asset. In essence, better data (via data integrity) will lead to better insights, allowing organizations to focus on actions that will yield higher financial and operational improvements.
However, a significant number of healthcare organizations are at a disadvantage since they are unable to answer these basic questions: “What devices do we actually have?” “Where are these assets located?” “And are they available?” On the other end of the spectrum are the institutions that have harnessed the necessary data and have the ability to answer these higher-value questions:
- “Is my HTM staff structured and staffed around driving optimal availability of mission-critical devices?”
- • “Is the maintenance plan aligned with census projections?”
- “What’s the cost of service per device?”
- “Who are our strategic suppliers? How do we qualify and measure them?”
- “How much time is my staff spending on administrative tasks versus technical services?”
- “How much time do we spend on measuring and reporting (i.e., compliance and key performance indicators)?”
- “When should certain assets be replaced or budgeted for replacement?”
- “Would it be more cost effective to self-service higher-end clinical assets, rather than low-end equipment, which can be sent out to a single-service provider (despite having the in-house technical expertise for this low-end equipment)? Or do we have economies of scale on certain low-end equipment to make it worthwhile?”
- “How can we save money through parts sourcing?” (For instance, maximizing utilization of spare parts via centralization and parts recovery from out-of-service- devices; avoiding overnight shipping via proper inventory levels; and leveraging outside sourcing services whose sole job is to source parts for their customers)
In addition to the potential in cost savings and improved operational performance, assets can have an impact on patient flow and quality of care (i.e., equipment down due to maintenance, misplaced, hidden or lost assets, etc.). Without the appropriate data, it’s very difficult to obtain or retain senior leadership’s support.
So where does one begin when looking to further in-house capabilities in an effort to improve financial and operational performance? The following is a brief list for consideration:
Strategies for Success
Do get better data. After all, good clinical asset management needs to be data-driven. Start with data standardization and improved data management. Standardizing medical asset data on all network devices down to the asset level—assuming you have an accurate inventory—will allow you to benchmark asset performance at the model level (i.e., compare average repair times and average cost to repair, detect failure rates, and identify outliers).
This requires standard nomenclature not only for equipment categories, but at the model level as well. Ultimately, continuous improvement will be dependent on this first step.
Do invest. It takes money to save money. Perhaps you need a computerized maintenance management system that allows your organization to effectively manage, monitor, and control assets; sourcing resources; technical training; or additional technical personnel. (Remember: Typically as the staffing pool increases, so does the complexity of systems that are managed in-house).
One needs to understand the financial needs of the organization (Consider taking your CFO to lunch!) to understand how to move your initiatives forward. In 2015, hospital CEOs ranked financial challenges as the main issue facing their organizations. Be prepared to use the language of business with administration (i.e, “ROI,” “NPV,” “cost savings versus cost avoidance”).
Also, monetize efficiency improvements—such as patient throughput as a result of asset readiness, hard-dollar savings versus soft savings, direct costs versus indirect costs, and deferred or eliminated future capital purchases—and assign business risks associated with different options. Partner with the finance department.
Do be proactive. By turning your data into strategic business insights, target which level of service your different assets require and when. Ensure certain trained engineers are available to service the equipment—and improve accuracy and timeliness of compliance reporting. Budget for assets that are coming off contract or warranty. Make sure to also budget for equipment that will need replacing and determine when such an event will take place.
HTM departments with effective clinical asset management insights drive strategic answers to these types of issues to support their bottom line and quality patient care.
Don’t expect change and continuous improvements by doing the same thing. It may be comfortable, but is it the most effective? As an example, if your primary focus is on preventive maintenance completion rates, yet your organization is unaware of their assets, location, or state of readiness, then the focus may be a bit myopic.
With continuous advancements of technology, hospital administrators recognize the impact technology has on the hospital’s bottom line and identify a widespread disconnect between hospital managers and the hospital’s clinical assets. Furthermore, an integrated approach to asset management offers benefits to improve both operational and financial performance with the HTM department front and center.
Jim Salmons is vice president of multi-vendor services at Philips Healthcare.