Preference cards as a ticket to savings

Charleston Area Medical Center took a good, hard look at its OR preference cards, identified waste, and set up a system to achieve sustainable savings

By Steve Perry

Today, many hospitals are feeling the pressure to implement processes and solutions to control and reduce costs without impacting or sacrificing patient care. Charleston Area Medical Center is one of them.

Charleston Area Medical Center is a four-site, 850-bed teaching health system in Charleston, W.V. Our largest facility – Memorial – hosts cardiac, internal medicine and oncology cases. General, the second largest, focuses primarily on neurology, orthopedics and trauma. Women and Children’s is the smallest of the three main campuses, specializing in women’s and pediatric care. Teays Valley is the final complex that makes up the CAMC system. The health system includes over 600 practicing physicians and performs 30,000 surgical procedures annually.

The operating room material budget exceeds $40 million annually across all facilities.

As the CAMC team embarked on our cost reduction journey, one thing was clear: The system needed to find ways to reduce cost that did not involve labor reductions or cause any negative effect on patient care.

OR waste
The team quickly realized that there was a substantial amount of material wasted throughout the organization, much of it within the operating rooms. This was evident by the amount of unused materials the facility would collect for later use in support of mission trips. The facility needed to implement a process to allow for sustainable corrective action to drive cost savings.

Through several Six Sigma initiatives, we had previously identified opportunities to reduce unnecessary material waste, but these initiatives yielded only short-term success. This suggested that measuring usage, measuring waste, tracking the reasons for waste, and then sustaining a lower waste rate long-term would be more challenging.

CAMC assembled a group comprised of nursing and supply chain staff to review our processes and come up with recommendations for improvement.

At CAMC, the majority of materials used in the operating rooms are issued via surgeon preference cards. The team quickly recognized that inefficient preference cards were the root cause of excess materials being issued, returned and held. It became clear that maintaining preference card accuracy and refreshing preference cards would be key elements of our waste elimination strategy.
With the problem clearly identified, CAMC made Operating Room Material Utilization Improvement a top priority project, and appointed an internal champion to oversee the effort.

Measuring material utilization
CAMC began a search for a solution that would allow us to capture the data relevant to measuring and managing material utilization and associated waste in a sustainable fashion. We sought a solution characterized by ease-of-use, real-time data availability and a push reporting system to alert managers of cost performance and potential issues.

Ultimately, CAMC selected LINCS®, (Lean Information Control System) from USC Consulting Group, LLC, as the technology platform. The software collects and aggregates data from both the Operating Room Scheduling System and the Materials Information System such that the data can be married and compared, and relevant reports created. Custom reports allow staff to compare material issued, used and returned, in a number of different ways, including comparisons between doctors, procedures and hospitals.

The technology solution was supported by a hands-on implementation team from the operations consulting firm, which helped CAMC accomplish our objectives:

  • Ensure all material issued to the operating rooms is accounted for based on use and that appropriate charges and billing take place for consumed items.
  • Provide factual data to drive preference card optimization such that resource nurses are able to evaluate which items are being used and returned, which items should remain on the preference cards, and which items should be removed. Removing the items from the preference card mitigates the opportunity for items to be opened unnecessarily in advance of a procedure or damaged en route to and from the operating rooms.
  • Support a new material color-coding process whereby resource nurses color-code items for surgical cases on more than 600 preference cards. Items that are not colored are always used in cases, and need to be opened in advance so they are readily available for use during the procedure. Yellow items may be indicative of the patient size or procedure variations, and are to be opened only after a request from the physician. Red items should not be opened in advance, but are mandated to be present in the operating rooms during the case.
  • Support the addition of color-coded bins on each case cart to easily identify how items should be handled.

Implementing change
Once nurses were trained and began to familiarize themselves with the new processes, they began to track items that were wasted or contaminated. If items were wasted during a case, these were captured along with a reason code in the LINCS® system. This information was used to create visual tools, including graphs and pareto charts, which enabled managers to quickly identify items being wasted, the type of waste (opened but unused, damaged, contaminated, etc.) and the reason(s) for waste, such that the appropriate corrective action and waste elimination measures could be implemented.

With these tools and techniques, directors and managers now had the ability to look at results overall and on a case-by-case basis to help identify any trends that were occurring.

The final piece of the solution was to implement a mechanism for assigning actions to individuals in order to identify and propose opportunities for improvement. This fundamental component was also institutionalized via the LINCS® technology platform’s Action Item system. Now, during each case, nurses and circulators can identify potential opportunities to improve not only material management processes, but other issues that might have occurred. This improves communication and drives actionable outcomes. The electronic repository replaced their old hand written de-brief system with an electronic de-brief system, enabling the immediate assignment of issues to owners for resolution. These owners are immediately notified, and then a report is generated, based on parameters created by the
surgical director.

“The Action Item tool has tremendously improved communication and provides visibility to issues that occur,” says Brian Hughes, surgical nurse. “This gives us confidence in bringing up opportunities for improvement, as we know they are not lost in a black hole.” The combination of action item tracking and clear accountability has resulted in more immediate follow-up, investigation and resolution of out-of-tolerance situations.

Armed with meaningful data and actionable insight, CAMC has been successful in accomplishing our goal of reducing material waste in the operating rooms. The ideology is now being used throughout the hospital network. Additional benefits have included improved labor in the Central Stores (CS) through a reduction in material handling (pulling and restocking). CAMC anticipates additional improvement in inventory management, as less material will be in transit between the operating rooms and Central Stores.

“The new process has allowed for better management of preference cards and alerts me if I have not optimized a card,” says Marcy Myers, OR director. “We have not only been successful at using the Action Item tool to reduce material, but we have used it in our pre-op area to gain visibility and track turnaround times and on-time starts. This has helped us streamline the process and reduce any problems that may have occurred.”

Updating 600 cards
The team reviewed and updated more than 600 preference cards using historical data provided by LINCS® to identify and remove items with a large variance between what was issued and what was actually used in surgical procedures. The team ran cross-physician or cross-procedure comparisons to identify which items were used in like cases, and then worked to remove unnecessary items.

The team also used the system to color-code items on preference cards to identify those that were required to be issued, but were color-coded as 1) “Open,” 2) “Open upon consulting physician,” or 3) “Refrain from opening until deemed absolutely necessary.” The color codes then allowed for Central Supply to add a color-coded bin system to the case carts to correctly identify material handling requirements for these items. This has reduced the number of overall transactions occurring between Central Service and the operating rooms.

“We have seen a decrease in the amount of returns from a baseline of 37 percent to 16 percent in the current year, one year after the project concluded,” says Myers. The software also established an alerting system that provides notices if a card has not been modified for a set time period, as well as if the cost of the card increased more than a specified amount. “The alerting process has been great to notify all of our charge nurses which cards need to be optimized and which cards have increased in cost outside of the parameters set. This has allowed us to maintain control of the cards.”

Going forward, it is critical that the staff does not revert back to old habits. That will only be achieved through disciplined behavior. CAMC has made a concentrated effort to review preference cards with surgeons, use LINCS® to show preference card cost comparisons, and identify opportunities for standardization. The system has been configured to push notification reports and alerts, providing an immediate signal to the director to evaluate and verify that proper processes are being followed.

“The system allows us to see which cards need updating, and we can also run multiple reports to make sure they are as optimized as possible,” says Myers. “The project has allowed us to streamline our overall processes.”
The de-brief and action item tool has allowed nurses to capture the actionable data to understand what items are being wasted in the rooms and drive corrective action to reduce and remove them. “The system has made it quicker and more efficient to track and identify material issues and take the correct action,” says Alex Cornell, OR charge nurse.

The system also provides visual physician-to-physician or procedure-to-procedure comparisons. In addition to the reports being sent to the director level, CAMC has appointed an associate administrator as the ongoing champion of sustainment to ensure that all processes and reports are followed and success is maintained.

“Following the processes implemented and using the software, I am able to view multiple reports to assess the current performance of our OR material usage,” says OR Director Barb Sepcic. The administrator and a core group will continue to meet regularly to review progress and new opportunities.

Steve Perry is corporate director supply chain management, Charleston Area Medical Center


Charleston Area Medical Center found that reviewing preference cards on a regular basis was a challenging task. Some reasons why:

  • Meaningful data was not available to help CAMC make informed decisions about what should be included on the preference cards.
  • Two different systems were being used to track materials, but these systems were not integrated, and meaningful data could not be obtained.
  • Materials used were not tracked against
  • materials that were issued.
  • Resource nurses lacked the statistical tools to assist them in making informed decisions about what should be on a preference card and what should not. Thus, decisions about what would remain on a preference card were made subjectively, as opposed to objectively, based upon true usage rates.
  • Preference cards called for the same item to be issued in multiple sizes, when in fact, only one size was needed based on patient or procedure characteristics. Unused sizes had a high probability of turning into wasted items or becoming contaminated and therefore unusable.
  • Notifications or alerts highlighting preference cards whose cost increased above a targeted value did not exist.
  • Neither surgery nurses nor resource nurses were accountable for ensuring that only required materials were opened in advance, while materials with potential for use were readily available but unopened.

By the Numbers

To date, Charleston Area Medical Center has identified and eliminated material waste across all facilities, such that we have seen a cost avoidance of $100, or 15 percent, per case on all the “preference cards items” at all hospitals. That is an annual avoidance/savings of approximately $2.3 million. Although we documented savings on the preference card items, it should be noted that the overall cost per case increased, which we attributed to newer technologies such as robotics, increased utilization of advanced energy devices, etc. That said, the project helped bend the curve on the overall rate of increase in supply expense in the OR. The amount of material issued has also decreased more than $14.9 million, or 47 percent, per year. Material returned across all facilities has decreased by $11.2 million, or 66 percent, per year. In addition, the CAMC health system has been able to significantly reduce the amount of transaction time and handling time required per case.

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