Lean Hospital Materials
Processes and Throughput Costs
in an Increasingly Tightened
Economic Market
Materials Cost Savings from Start
to Finish
Supplies, a close second behind labor when it
comes to costs, travel along the supply chain
each day, from manufacturers and distributors
to group purchasing organizations (GPOs) and
healthcare providers, and then directly to
patients. Even though medical personnel are
not within the conventional supply chain, they
are the eventual users of products and
equipment and remain a major part of any
materials cost-savings process.
To start maximizing your cost-savings efforts, follow
these action items
• Determine annualized savings goals at the beginning of each fiscal
• Classify areas of opportunity.
• Form or refocus your Value Analysis Committee to create internal
value and physician buy-in.
• Estimate potential savings.
• Capture savings.
Organization and Standardization
Global standards assist hospital materials
management processes and procedures
and have been proven to have positive
benefits and effects for the safety of
patients and supply chain operations,
•Reduced pharmaceutical errors through
better identification automation (the right
product, in the right dosage, to the right
patient, by the right route, at the right time)
•Well-organized traceability
•Proficient product verification
•Reduced manual documentation time
• Lower costs due to operational efficiencies
• Better order/invoice procedures
•Enhanced receiving/distribution processes
•Higher-quality product recall
•Well-organized shelf management
•High productivity rates
•Reduced inventory
•Enhanced service levels/fill rates
•Better benchmarking and administration of
materials charges
•Eliminated need for relabeling and
proprietary codes
•Regulatory compliance
Global Location Numbers
Global location numbers (GLNs) are widely
used throughout healthcare supply chain
groups. This unique, thirteen-digit number
links the name, industry, and address of a
particular item that pinpoints the “legal,
functional, or physical location within a
business or organizational entity,” in
Association for Healthcare Resource and
Materials Management (AHRMM) Stance
on Comparative Effectiveness Research
In today’s hospital setting, data and
healthcare information is the most
accessible it has ever been, making it
necessary for healthcare professionals to
assess and evaluate its accuracy.
AHRMM’s Issues and Legislative Committee has
advocated the usage of comparative effectiveness
research (CER) to offer substantial, evidence-based
data to aid healthcare organizations in their
purchasing decisions. CER data includes unbiased
conclusions regarding healthcare products and
supplies after the advantages, usefulness, and
possible harm of numerous pharmaceuticals,
medical devices, equipment, surgical procedures,
and tests for specific disease states and treatments
of care have been compared .
By utilizing the CER-provided data, healthcare materials
management professionals can:
•Warrant top-performing value analysis committees.
•Verify the cost-effectiveness and ability of salvaging
single-use items.
•Regulate medical/surgical products.
•Capitalize information technology efforts to decrease
expenditures and inaccuracies.
•Change supplies, services, and technologies to lower,
budget-friendly, clinically acceptable options that endure
needed specifications.
•Convert to supplies, services, and technologies that
produce better patient outcomes at a lower total cost
that meets needed specifications.
•Prioritize capital expenditures.
•Use third-party benchmarking methods to get the most
out of resources