It may be one of the biggest epidemics in health care. It’s not obesity or cancer. It’s the enormous pressure that US hospitals face to remain profitable and stay in business.

Consider what is happening in New York, which is merely a symptom of the greater epidemic. Over a year ago, historic St Vincent’s hospital filed for bankruptcy because it was $1 billion in debt and was losing $10 million every month—and it was just one of many hospitals facing serious financial obstacles.

Antti Korhonen

Antti Korhonen

So what’s the problem? Hospitals are spending more than they are making. This statistic is not surprising. In the case of New York, only three out of 10 patient cases were profitable, and Medicare and Medicaid paid only 70 cents per dollar that was spent for patient care.

To save money, hospital executives must answer one fundamental question: How can we do more with less?

Stopping the Bleeding

One way to address this challenge is to avoid significant expenses related to managing expensive mobile equipment, such as IV pumps and wheelchairs, which the hospitals often lose track of and must rent or buy additional pieces of in order to serve patients.

Hospitals can stop some of the financial bleeding by optimizing asset utilization and decreasing patient wait times. To make these improvements, management first needs a clear picture of the current state of operations and how processes work. They must consider where staff, patients, and equipment are at any given time, where bottlenecks exist in patient flow or staff workflow, and if idle equipment could be utilized more efficiently. Having this type of detailed assessment of current operations for decision-making purposes is feasible with the right technology.

That technology is real-time location system (RTLS) solutions, which began to gain momentum in hospitals in 2002 when the first Wi-Fi-based system was introduced. Using the existing Wi-Fi network eliminated the need for proprietary RTLS infrastructure, reducing the cost of RTLS, enabling a fast, positive ROI [return on investment], and reducing installation times to just a few weeks. All that was needed were RTLS tags and software with sophisticated location algorithms to achieve a pinpoint accuracy using the existing Wi-Fi network. Wi-Fi-based RTLS enables hospitals to immediately gain visibility to critical asset and people movements enterprisewide in real-time.

The Prescription for Savings

RTLS is delivering major savings at hospitals around the world. Consider how RTLS is a prescription for savings at the University of Kentucky Medical Center. The hospital implemented an RTLS system to enable improvements in asset management, after reaching $400,000 annual spending on rental equipment. Using RTLS to track 3,000 pieces of mobile medical equipment, staff realized that they were needlessly renting additional units. With better visibility into asset utilization, the hospital was able to save more than $350,000 in less than 1 year.

To deploy RTLS over Wi-Fi networks, the hospital only needs to make an investment in RTLS software and wireless tags—a cost that is almost immediately offset by savings in equipment rental or purchase. Since most hospitals have already deployed enterprise-grade Wi-Fi networks from major standards-based vendors for their voice and data applications, the addition of RTLS further improves the ROI on these infrastructure investments. By using existing Wi-Fi access point signals, the RTLS system calculates the real-time location of each piece of equipment and person, and provides that information on graphical maps, creates reports on asset utilization and workflows, triggers alarms, and sends messages and work orders.

While Wi-Fi-based RTLS is the easiest to deploy and least expensive solution, there are ways that it can be improved. Because location is determined by the signal strength between the Wi-Fi tag and access point, Wi-Fi RTLS alone cannot easily determine the difference between the location of a particular hospital bed or the bed next to it, nor can it detect a paper-thin wall or a curtain. The most practical solution to enable this “micro zone” detection accuracy is to use an inexpensive assisting technology, such as infrared (IR) light. For example, Wi-Fi RTLS wristband tags also use an IR detector that communicates with an IR transmitter installed above the bed, enabling the system to wirelessly report that a patient is in his/her bed. Micro-zone location also can be used to detect how often staff members are washing their hands at designated hand-washing stations.

Technology for improving efficiency and giving better visibility into operations is vital to help hospitals stem the financial bleeding and improve their overall well-being. Hospitals must seriously consider the benefits of solutions, such as Wi-Fi-based RTLS, that have been accepted industrywide and can deliver real-time information about key processes. This enables hospital management to quickly assess bottlenecks in patient flow, issues with asset utilization, compliance with health and safety procedures, and other key metrics. Real-time operational information from mobile assets and people will be available to facilitate rapid decision-making, which can significantly improve efficiency for the delivery of better care, using fewer resources and reducing costs to ensure that hospitals can remain fiscally healthy long into the future.

Antti Korhonen is the president and CEO of Ekahau Inc, which introduced the first Wi-Fi-based RTLS solution in 2002 and is now used in more than 300 hospitals. For more information, contact .

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