Supply Chain Management in Hospital

Pantai Hospital Ipoh (PHI), registered under Paloh Medical Centre Sdn. Bhd, was established in year 1996 owned by Pantai Group, part of IHH Healthcare Berhad; one of the most significant healthcare operators in the world that provide premium healthcare services in Asia, Central and Eastern Europe, the Middle East and North Africa. The hospital is strategically located in Ipoh and easily accessible within a 5 minutes drive from the North-South Highway Interchange and the Ipoh City Centre.Pantai Hospital Ipoh was started to serve the local communities of Ipoh, and has since grown to become one of the private premier healthcare providers in Perak, and the northern region of Malaysia. Pantai Hospital Ipoh started with just only 76 beds, and now has 180 beds and 82 consultant specialists, providing quality care and treatment aided by qualified nurses and other allied healthcare professionals.In partnership with various health insurers and corporate organizations, PHI has established itsel f as a preferred provider, allowing greater and easier access to its healthcare services, which extends beyond just a single hospital through the extensive network of more than 10 Pantai and Gleneagles Hospitals, all part of IHH Healthcare Berhad. Through the use of appropriate technology and skills, Pantai Hospital Ipoh is firm in its vision to be the trusted professionals of healthcare delivery, from prevention, detection to treatment and care, when it matters most.Apart from providing a wide range of modern facilities and the expertise of many consultant specialists, the hospital is staffed with warm and friendly personnel who are dedicated to give our customers the personalized attention and quality care they deserve. Central to its commitment towards quality healthcare, PHI strives to provide excellence in service and its future will be built on welcoming change innovation, today and tomorrow. In year 2005, Pantai Hospital Ipoh has successfully obtained ISO 9001:2008.The Hospit al continuously seeks to improve the organization’s performance and the outcome of cares. With this, PHI has started the adoption the best and safe practices for all the clinical and non-clinical areas which guided by Malaysia Society in Healthcare Quality. Since the inception of Pantai Hospital Ipoh in 1996, the hospital has increased tremendously the disciplinary medical and surgical specialties. Listings below are the specialties provided by Pantai Hospital currently: †¢ Anaesthesiology †¢ Cardiology †¢ Colorectal Surgery †¢ Cardiothoracic Anaethesiology Cardiothoracic Surgery †¢ Dental / Oral Surgery †¢ Dermatology †¢ Ear, Nose & Throat Surgery (ENT) †¢ Gastroenterology †¢ General Surgery †¢ Haematology †¢ Immunology †¢ Infertility †¢ Internal Medicine †¢ Nephrology †¢ Neurology †¢ Neurosurgery †¢ Orthopaedic Surgery †¢ Obstetrics and Gynaecology †¢ Ophthalmology †¢ Paediat rics †¢ Pain Management †¢ Plastic and Reconstructive Surgery †¢ Psychiatry †¢ Urology †¢ Rheumatology †¢ Respiratory †¢ Radiology To facilitate the services mentioned above, Pantai Hospital Ipoh has established the following facilities and services: a. 24hrs Accident & EmergencyTo provide 24-hour services for emergency as well as less urgent cases that uses a triage system to determine the severity of each case, to ensure that priority is given to patients with the most urgent medical need. b. Ambulance Services Our ambulance service provides transportation of patients throughout Malaysia with includes: †¢ 24-hour Prompt Emergency Response-Time †¢ Specialized transport services †¢ Inter-hospital / inter-clinic transfers †¢ Doctor / nurse escort to provide immediate in-ambulance care †¢ Ambulance pick-up for calls within Ipoh City c. Physiotherapy & Rehabilitation CentreThe centre offers a wide range of rehabilitation progr ammes to help patients to achieve functionality and mobility. Amongst the broad spectrum of services include preventive care, and the treatment as well as management of movement disorders arising form medical conditions and lifelong disabilities. d. Imaging Service Pantai Hospital Ipoh has a complete range of imaging services including Multi-slice CT Scanner, Magnetic Resonance Imaging (MRI), X-rays, ultrasound & doppler scans and mammography. The department operates 24 hours, serving in-patients, outpatients as well as patients referred from external healthcare providers. e.Dietetic Counselling PHI’s dietitian provide individualized programs and counseling for patients, based on the doctor’s recommendations and patient’s condition. The dietitian also ensure that all food served to patients are low in fat, salt and sugar and ultimately meet the specific nutritional requirement of individual patient’s medical conditions and the doctor’s diagnosis. f . Pharmacy Service The hospital’s pharmacy is open 24 hours, dispensing medications for both inpatients and outpatients. Pharmacy staff also offer Patient Counselling Service; to advice patients on the correct way of taking as well as storing their medications.This service also extended to bed-side counseling for inpatients. g. Pathology and Laboratory Services PHI’s pathology services are managed and provided by Pantai Premier Pathology Sdn Bhd, The lab offers a full range of laboratory services and tests that are performed by skilled and experience personnel with sophisticated equipments. Pathologists are available for clinical consultation on concerns related to appropriate test utilization, assistance in test result interpretation or any other concerns which may occur in the course of patient management. h. Diagnostic and Endoscopic CentreThe centre provides treadmill to perform Stress Test to facilitate cardiac assessment; nad machines for ECG and Echo Cardiograms as well as Carotid Duplex to assess arterial blockages. The centre also carries out Dobutamine Stress Echo as an alternative method for those patients whose condition makes them unsuitable to undergo a Stress Test but urgently need cardiac assessment and 24-hour Ambulatory Blood Pressure Monitoring as well as Holter Monitoring which provides round-the-clock ECG monitoring especially for patients who complain of palpitations and/or sudden blackouts.The Endoscopic Centre facilitates varies type of scopes including gastroscopy, colonoscopy bronchoscopy, cystoscopy and ERCP. i. Brain and Nerve Centre The centre is equipped with machines which carry out the following procedures: †¢ Electroencephalogram (EEG) †¢ Nerve Conduction Study (NCS) †¢ Electromyogram (EMG) †¢ Visual Evoked Potential (VEP) Study †¢ Brain Auditory Evoked Potential (BAEP) Study j. Sleep Study Sleep Studies are conducted is a sleep laboratory; help doctor confirm certain sleep disorders. k. H aemodialysis CentreThe Putri Dialysis Centre is a well equipped centre that is designed to provide patients with a comfortable environment including waiting areas for accompanying family members, light refreshments and audio-video entertainment. l. Dental Services PHI has a well equipped dental clinic with a resident dentist and aided by visiting dental surgeons, who can undertake and perform complex dental procedures. m. Health and Wellness Centre It provides a wide range of premium screening programmes that will equip the customer with the knowledge and awareness to help to maintain optimum health. . Parking & Valet Service Pantai Hospital Ipoh offers complimentary parking services, further enhanced by a free Valet Service, which operates during the following hours: Monday to Friday- 7. 00am – 7. 00pm Saturday- 7. 00am – 5. 00pm Sunday- 9. 00am – 5. 00pm o. Concierge Service Complimentary concierge services are provided for patients who discharged from the hos pital, to help to transport their bags and belongings from their respective ward to the lobby, where Customer Care Assistant are at hand further assist the patient to alight their mode of transportation. . Financial Counselling Financial Counselling service was initiated to assist patients and their family members in managing the medical cost incurred from seeking treatment at Pantai Hospital Ipoh by offering cost estimation prior to procedure and assistance in getting financial aid from Employees’ Provident Fund (EPF) and relevant financial institution, should be arise. q. Other ServicesOther services that provide by Pantai Hospital Ipoh include; †¢ Hospital Cafetaria – certified halal providing a variety of local and international cuisine †¢ Bread Legend – offering wide choice of breads and buns †¢ Convimart – a mini convenience store selling magazines, snacks, drinks, gifts and fruit baskets. †¢ Natural Health Farm – Offering various health products that promote better health and longevity of human body, skin and hair. †¢ Ipoh Medical Supplies – offering a range of common medical supplies and equipment. †¢ Banking facilities – An ATM machine is strategically located at the hospital lobby. Internet Access – provides free WIFI access through-out the hospital for everyone Patient that require for inpatient treatment could be admitted through the Emergency Department or through Specialist Consultant or General Practitioner Clinic. Pantai Hospital Ipoh offers a range of room types, to cater individual needs and demands; however theses are subject to availability and if a particular room type is not available, option will be provided and efforts will be made to have the requested room type provided as soon as it is available. Below are the room rates which are subject to 6% Government Tax.Meals are complimentary to all patients. Room TypesRates Per Day (RM) †¢ Executive Del uxe Room330. 00 †¢ Deluxe Room250. 00 †¢ Single Room160. 00 †¢ Double-Bedded Room110. 00 †¢ Four-Bedded Room60. 00 †¢ ICU / CCU150. 00 †¢ Isolation Room 150. 00 †¢ Nursery25. 00 †¢ Day Case35. 00 †¢ Incubator 105. 00 Supply chain is the lifeblood of a healthcare organization. The supply chain process is the essential link for all programs and services offered by a hospital, and hence any improvement in managing the supply chain can positively impact bottom line profitability of any hospital’s operations.As most departments in Pantai Hospital Ipoh depend heavily on supplies, materials management can ease or cramp a hospital’s operations. From a low cost needle to a high-end orthopaedic implant, special instruments or pieces of linen, supplies are indispensable during a patient’s stay at the hospital. Quality care cannot be provided on time unless required material is available in adequate quantity. As such Pantai Hospi tal Ipoh, has established a purchasing department to centralize the purchasing all medical supplies, medical equipment and instrument, consumables, stationeries and toiletry within the hospital.The department not only to purchase but to perform price negotiation to ensure every item that purchased is the lowest price but of course without comprising the quality. Together with Store Department, Purchasing Department determines the minimum and maximum level for every single item for re-ordering purposes. To determine the minimum and maximum level, a few factors will be observed; the usage of them item / product, location of the supplier, the availability of the item / product in the market and delivery schedule.Thus, the purchasing needs to communicate with all the relevant departments and the supplier to ensure that is no shortage of all supplies and at the same time to ensure our store department is not holding too much stock. At our Pharmacy Department, the department also performe d the similar task as purchasing department but limited to pharmaceutical products. This is because pharmaceutical products need specialized person who is the pharmacist with the consultation of specialist consultants to understand the drugs usage and its complication.Pantai Hospital Ipoh not only subscribes to patented / original drugs but also generic drugs that provide the same effectiveness comparing to the original drugs but much lower in price. As generic drugs are less expensive, it could help to lower down the overall treatment cost that could enjoyed by the patient. The supply chain does not stop at the purchasing and pharmacy department. It is important that the purchased medical supplies and drugs are delivered to all the respective wards, clinics, operation theatre and other relevant departments to ensure no interruption of patient care.Hence, a supply chain system has been developed from early stage of sourcing and ordering to the patient consumption. As mentioned earli er, sourcing and ordering is done by purchasing and pharmacy department. Once the goods arrived to hospital, the respective store; general store and pharmacy store, will received their goods. The respective store will entered the stock into our Hospital Information System, and from there the stock will be arranged in the store systematically. The wards, departments and operation theatre will requisite their items based on their pre-set minimum and maximum level.For those high activities department for example operation theatre, they are allowed for three time requisition a week and as for less or average activities, will allowed to requisite their stock two times a week. As if any urgent requisition, store will allowed with valid reason. The receiving wards or departments will then store their stock in their respective store and label all stocks. The ward or department will consume the item(s) based on ‘first in first out (FIFO)’ method to ensure no there is no expiry p roducts. Ward and departmental clerk will ensure all the availability of the stocks is at a path level.At Pantai Hospital Ipoh, we also understand that supply chains may be more efficient and inexpensive by outsourcing of certain services. The main services that outsources are housekeeping. UMC Service Master, a well-known company in healthcare providing housekeeping services, has been appointed to manage housekeeping in the hospital. The programs offered by UMC Service Master has successfully provided measurable results by improving quality, containing costs, training and motivating employees and minimize risks. The company also takes over some of the nurses’ daily routine jobs for example bed making for inpatient and discharge patient.This enables the nurses to concentrate on the more critical matter which is patient care. Beside the purchasing, stock management and outsourcing, Pantai Hospital Ipoh also involved in a supply chain with international and local insurance comp anies and managed care organization or third party administrator. The insurance companies, managed care organization and third party administrator will signed a partnership agreement with the hospital to become panel hospital and to provide cashless healthcare facilities for their policyholders that are covered under their purchased policy.The treatment requested could be outpatient, daycase and/or inpatient depending on their policy terms and conditions. The process started when a patient requested for treatment; front office staff will request a guarantee letter (GL) from the respective insurance company, managed care organization or third party administrator by providing an initial medical report to them. The company will process the claim based on the initial report and if the case is covered, the company will issue the hospital a guarantee letter for payment.If the patient was admitted, hospital would to provide discharge summary and the total bill to the respective company for payment guarantee. Some companies do cover for the post-hospitalization up to 60 days of discharge. Our Marketing department also practices supply chain in their marketing activities. They has established a programme known as ‘Pantai Putri Member of Affiliation Program (PPMAP)’ to recruit general practitioner (GP) in Perak region to become part of PPMAP member.The objective is to obtain referral of patients to the hospital from the GPs, as Pantai Hospital Ipoh understands that GPs could be a good source of generating business. In return of the referral, Pantai Hospital will support their clinic by providing them on-going education and promoting their clinic by recommending to the local public and during any road show organized by Hospital Pantai Ipoh. This will generates a strong back to back support and mutually benefited.For the past few years, there was a lot of development and improvement taken place in Pantai Hospital in related with supply chain management but th e hospital is still facing challenges in managing the effectiveness of supply chain system. The challenges can be classified at below: a. Lack of Product Management b. Limited Sourcing and Services c. Outdated IT systems d. Lack of Inventory and Distribution Management Lack of Product Management First, the hospital could categorize the products in terms of cost, criticality and other criteria.For instance, bed linen may be less critical and represent a low cost to the hospital; paracetamol may be urgently required but inexpensive; while specialist cancer drugs may be both urgent and costly. This product categorization will dictate supply chain design. For example, drugs and medical equipment might be ordered directly from the manufacturers’ own stock, often at short notice and in unpredictable quantities, requiring storage relatively nearby. Medical supplies, on the other hand, will be subject to a more regular supply chain, providing greater flexibility in responding to emer gencies.Secondly, hospital and specialist doctor should work under one vision and direction in providing the best service at a reasonable cost. In heealthcare industry, we understand specialist consultants are independent contractors with considerable clout and specific preferences for supplies and some variations in supplies and processes are accommodated to ensure patient safety. These Preference Items accountable for more than 50% of total medical supply spending in PHI. This provide an opportunity for supply chain savings in the area of physician buy-in especially with respect to changes in purchase and use of high-cost clinical items.It is commonly perceived that physicians are resistant to change. He points to the fact that data which supports the decision to use a particular supply can go a long way in convincing a physician to use a particular supply. PHI could establish a product evaluation and review committees which consist of clinical experts, purchasing and finance pers onnel to overcome the problem. The purpose of the committee is to decide to purchase and universally adopt cost-effective items for use within all hospitals and the decision making is by team consensus.The finance and purchasing personnel could educate the clinical experts on the financial impact of various supplier options. Therefore, the use of consensus, instead of majority rule, in the decision making process minimizes any postsourcing disagreement and results in the high compliance rate and buy-ins from all physicians. This will helps purchasing to further negotiate and obtain lower price from the supplier as the hospital is now buying exclusively from the supplier only with bigger quantity.Thirdly, in PHI product cost assessment, hospital must evaluate the ‘total cost’ rather than just ‘unit product cost’ in determining the types of products to purchase. The cost of a product is evaluated from the types of raw materials used for the product and how th is will impact the disposal cost associated with the product. For example, the use of analog X-Ray equipment may have a lower unit cost initially, but the tool utilizes X-ray film that contained mercury, may result in a significant disposal fee which needs to be calculated in the total cost.Hence, hospital should to considering total cost has resulted in significant cost savings. Sourcing and Services Effective management of the external supply chain typically covers every facet of procurement activity – such as supplier selection, contract negotiation, planning and implementation, distribution and delivery – while taking factors such as risk, reward into account. There are 9 Pantai Hospital and 2 Gleneagles Hospital in whole Malaysia, as such Centralize Group Purchasing is possible.Centralize Group Purchasing have provided significant cost saving opportunities for hospitals by taking advantage of economies of scale in purchasing from select vendors for many hospitals at once. Cost saving includes better contract terms, price reduction, rebates and overhead costs. Purchasing Systems and Technology Pantai Hospital Ipoh has an outdated Hospital Information System (HIS) to manage their supply chains, known as Procare. These outdated data management systems do not have the capacity to meet the changes and needs today.The challenge faced by PHI is how to seamlessly transition the wealth of data without disrupting the existing purchasing system and inter-departmental integration. One identified area in supply chain structure that PHI could further improve on is in the area of purchasing systems and technology. PHI can explore new technologies and leverage on what has been successfully done in other Pantai hospitals to enable staffs to access faster, more valuable and easier access to necessary supply information when ordering.At time hospital spend significant resources to reconcile purchase orders and invoices due to mismatched item numbers and units of measure. Another challenge that PHI faces is in identifying personnel capable of understanding the old technology used by the existing IT systems to effectively move it to a newer platform. Although this is not a unique problem faced by PHI, there is no industry standard that can easily help provide a cost- and time-effective solution.Hence, the technology upgrade for PHI’s purchasing system remains an area to be addressed and recognized by the management. Once improved, the flexibility of the system will allow KP a more detailed view of its purchasing process and use of products, which will in turn provide better insight into creating a more effective cost structure. Inventory and Distribution Management It is critical for PHI to maintain a sufficient level of inventory at all times to ensure the needs of patients are always met. Failure to do so could result in the loss of life.In a hospital, managing its inventory is not easy as there are thousands of inventories, both medical and non-medical products. The distribution mechanism is also very important to ensure the product(s) is delivered to the end user in the hospital. PHI’s general store often mismanaged of the inventories, the current inventory system is ineffective and inefficient. The challenge that PHI is facing is that the management is unable to provide a sufficient storage and no proper and experience staff to head and managed the store.To overcome the issue, first PHI need to engage an experience staff who has know about inventory management and to review and examine the overall existing available storage space to maximize the current storage with the assistance of shelf, cabinet or compactor. Secondary storage could be developed to separate the medical and non-medical items. PHI could incorporate radio frequency identification technology (RFID) into its inventory management system. RFID systems have a broad range of potential benefits for the health care industry.These include m edical device and asset tracking, improved visibility of inventory and supply chain management, and improved patient safety by preventing drug counterfeiting. In our current distribution, the store depend on the departmental clerk to requisite their stock. As mentioned early, some departments / patient care units replenish their stock 3-times a week but some are only 2-times a week. Especially, the patient care unit, inventory management for them is a hassle as they are focusing on patient care. At time, the unit forgot to replenish their stock; patient care was affected due to unavailability of the product.This challenge often faced by the medical staff. The distribution system should be improved to be more effective to prevent and to solve the issue. The general store could establish a system whereby there will be person in the store to monitor the availability of the stock via our Hospital Information System – Procare and since minimum and maximum ordering has already been fixed, the general store staff could deliver the stock(s) which is under path level to the respective patient care unit. The store would have better control of overall inventory and distribution and improvement activities could be carried out more efficient and effective.A good inventory management programme is always patient-centred. While inventory is concerned with financial issues, hospitals are in the business of serving patients. Although technology has an important role to play, the emphasis should be on using it in a way that makes a difference to the quality of patient care. Automating inefficient processes may not yield any productive result. Processes should be reengineered to make them more patient-friendly. Cost-effectiveness, time consciousness and safety are key drivers of a patient-centered approach.Once this goal is clear, technology can support and drive the efforts towards realizing efficiencies and improving the quality of health care services. Reference: 1. Pan tai Hospital Ipoh’s company profile (K. K. L. I. U. No. (0320/2012/C) 2. Asian Hospital & Healthcare Management – article on Materials Management in Healthcare ‘A patient-centred approach’ 3. Supply Chain Management in Hospital: A Case Study by Samuel Toba, Mary Tomasini, Y. Helio Yang, San Diego State University, San Diego, CA – published in California Journal of Operations Management, Volume 6, Number 1, February 2008