How Standardizing a Major Medical Center’s Hernia Product Line Saved Them Money

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Tue Mar 29 13:00:31 CDT 2016

Five years ago Covidien began working with the general surgeon of a respected major medical center and teaching hospital’s multi-campus system to convert it to its full suite of hernia repair products. The objectives: introduce new products and innovative methods that could speed patient healing and reduce pain, streamline the purchasing process, de-complicate the OR and save money by standardizing the hernia product line.

 

Situation

 

When the Covidien team began working with the hospital system, its hernia purchases included 163 product codes from five vendors. The system’s owned or affiliated satellite facilities had no set protocols for buying hernia products. The hospital system’s goals were to standardize and rationalize SKUs used for the same procedure, reduce the number of vendors for a specific category and streamline and gain efficiencies to reduce costs and improve their bottom line.

 

Process

 

The Covidien team made effective patient outcomes and cost-saving standardization the cornerstones of its outreach across the hospital system’s facilities. They understood that general surgeons who do inguinal, ventral or umbilical hernia repair have one overriding concern, and goal: Eliminate the patient’s need to return for any follow-on hernia procedures. They also understood the hospital’s mandate as a leading accountable care organization (ACO) to reduce costs while upholding its commitment to medical innovation and quality.

 

The team began by proposing the hospital system take a comprehensive look at their entire hernia repair program. Many surgeons volunteered to be part of the process. The re-assessment would include a review of the hospital’s current hernia product vendors and others qualified as sole source suppliers.

 

After narrowing down the number of vendors that could satisfy the requirements for synthetics and biologics, the hospital’s supply chain managers blinded the vendors’ names to conduct an objective evaluation of product attributes, pricing and savings. The hospital compared each product line on many levels. Could the product portfolio meet the hernia repair needs of surgeons at all facilities? What clinical outcomes would support a shift? What level of on-site support would the new product’s specialists deliver?

 

The Covidien team provided continuous information, support and feedback to key opinion leaders within the hospital, including its mesh committee chairman and members. At the hospital’s satellite locations, they met regularly with nurse managers and OR directors to project how the mesh conversion would positively affect lower-volume, lower turnover stocking requirements at those facilities.

 

During pre-clinical reviews and surgical education programs, they presented data that supported adoption of new procedures that, in combination with Covidien’s innovative mesh, suture and energy products have minimized hernia recurrences and reduced post-operative pain.

 

Drawing from on-site observations of over a hundred cases, the Covidien team was able to demonstrate how its hernia portfolio supports each surgeon’s procedural preferences in both open and laparoscopic techniques. As an example, for open ventral procedures, Covidien proposed using its Permacol™ surgical implant flat sheet mesh to reinforce the suture line and prevent recurrence of the hernia.

 

Supported by Covidien specialists, the hospital’s mesh committee reviewed each supplier’s product sizes and applications and quantified the economic value of moving to fewer product codes.

 

Throughout the process, Covidien’s team demonstrated their commitment to each surgeon’s practice while helping them evaluate new technologies and procedures. The team began its participation in product review meetings with “how are we doing?” sessions with the hospital’s supply chain managers. They proved their commitment to service by providing fast delivery of mesh products for new cases.
 

Results

 

The hospital’s supply chain reviewed the proposals from numerous suppliers and presented to the sourcing committee.  They voted on which supplier would provide a standardized line of hernia repair products, provide value and the best patient outcomes.  After final review, the decision was made to award Covidien a sole source agreement for 90% of the hospital systems hernia product line.
 

By including Covidien’s Permacol™ mesh for abdominal wall reconstruction in the standardized portfolio, the hospital was able to consolidate product codes from 163 to 49. The consolidation represents close to $1 million in savings across surgical implant and synthetic mesh products.
 

“In the 13 years I’ve been working in this region, I have witnessed this hospital system’s amazing growth. As a leading research and teaching facility, the hospital partners with innovative companies that offer new products and procedures, said Covidien’s senior hernia specialist. “The hospital’s “Patient First” focus requires a collaborative effort from all employees to offer the best care, while maintaining a close watch on the expenses that burden the facility’s bottom line. We’re honored to support this important customer’s conversion efforts and are dedicated to providing their mesh team with the highest caliber of service.”