Managing Inventory in Your ASC

Here's when to consider automation, manual process and just plain common sense.

By Sean McKinney, Contributing Editor

A $1,000 box of premium IOLs is nearly worth its weight in gold. Yet it can easily be misplaced or at least forgotten in the deep storage closets of today's ophthalmic ASCs. Keeping track of inventory poses many small challenges that can waste money, occupy staff and result in overstocked or understocked shelves.

The best way to guard against these problems? Be wary of the illusion of one fool-proof solution, experts say. Because of varying centers' needs, inventory management seems to defy uniform approaches. Read on to learn how ASCs are coping.

Open to Change

“You always have to adapt and change how you're doing things,” says Alan Aker, MD, who owns and operates the Aker-Kasten Eye Center with his wife, Ann Kasten-Aker, MD, in Boca Raton, Fla. “We do everything to provide economical and comfortable surgery at the highest level of quality possible. Good inventory management is one important way to accomplish these goals.”

The staff members at Aker-Kasten began using a barcode scanner to keep track of IOLs several years ago. Sue Smith, RN, director of nursing, says the staff scans the IOLs when they're pulled for surgery in the supply office. The data from the scans streams into the center's central computer tower via hard wire. Once surgery has been completed, the scanned product codes are listed on a spreadsheet.

Smith emails the spreadsheet to the IOL manufacturer and to the FDA to report on IOL usage. “With one email, we take care of our billing, inventory replacement and FDA reporting requirements,” says Ms. Smith. “We save a lot of time and eliminate the risk of error by using the scanning system.”

Figure 1. Custom surgical packs are automatically delivered to Aker-Kasten Eye Center at a rate of 300 per month, unless staff members manually reduce the order during slow summer months.

Automating the Process

Other automated systems are used in ASCs, where more than 50 cataract surgeries are performed per month, according to Gary Clark, Eastern Regional Sales Manager for SourceMedical, an automated system company based in Wallingford, Conn.

Mr. Clark says these systems can provide services and important information that aren't available through standard practice management software. “You can schedule patients, enter insurance information, complete a claim and charge for a co-payment with a practice management system,” says Mr. Clark. “But if you are in a large ophthalmic ASC — where multiple surgeons are using many different instruments, disposables and IOLs — you also need to keep track of products with a perpetual inventory system.”

With a SourceMedical software system, the product name, numbers and other important information are listed on the surgeon's preference card, telling staff which items to pull from inventory for each procedure. “After surgery, you can simply click a button and the items are automatically depleted from inventory,” he explains. “Or you can change what you use on a per-patient basis.”

Figure 2. A barcode scanner allows an ASC to efficiently compile data for inventory replacement and FDA reporting requirements.

When the ASC is ready to replace inventory, he adds, the staff can send a purchase order electronically to the supply vendor. “Within a matter of minutes, an email comes back confirming the order, and a shipment of 50 IOLs is sent to the ASC the next day,” he explains.

Besides safeguarding against overstocking or understocking, an automated inventory system helps manage costs. “An ASC can earn only so much revenue per case,” points out Clark. “If you determine that Dr. Clark is spending $300 more than Dr. Murphy on consumables, for example, that's important to know. These systems can provide this type of itemized information.”

SourceMedical recently announced the launch of Vision OnDemand, a cloud-based clinical and business management system for ASCs. The system integrates inventory management with patient information, facility operations, web-based access for remote scheduling, document management, claims support, quality assurance tracking and workflow management.

Streamlining the Process

Other systems provide automated support. MedFlow, Medflow Inc.'s software, designed to streamline administrative and clinical processes, can be used as a stand-alone program or it can be customized and linked to a practice management system. An ASC can create its own preference cards, surgical procedures, standing orders, RN checklists, CRNA checklists, intra-operative checklists (by specialty and procedure), operative notes and inventory. A “par score sheet” can be accessed by the CRNA and completed as part of final documentation of surgery. This information can then be merged with nursing and anesthesia reports.

DavLong Business Solutions, powered by Medflow, offers an inventory management system that's combined with practice management, electronic medical records (EMRS), and claims verification software. The company says its ASC Management System allows for management of all consents, labs and surgery plans. The system supports cataract, ocular/plastic cosmetic, strabismus and retina surgeries. Laser procedures for anterior and posterior surgeries are also supported, as are anesthesia and vital sign monitoring.

IOL calculations and registries are integrated into worksheets. The system emphasizes process control, including record keeping, billing and regulatory compliance reports. Inventory control and management — based on barcoding — are also supported.

Mednet has also created an inventory management system that's used in ophthalmic ASCs. With their product, MIRA, developers have tried to produce a complete medical supply chain management tool that lets an ASC combine automated and manual processes, as needed. Support of barcode technology and electronic submission of purchase orders create what the company describes as a perpetual, periodic, just-in-time inventory system.

Among the features are interfaces for vendors, item management, purchase orders, invoices, reports and labels. Besides barcoding, MIRA helps with patient supply management, inventory counts, IOL tracking, contract management, vendor contract assignment, vendor management, contract pricing audits, discount identification, invoice management, data uploads, equipment management, location tracking, allocation price per use, facility sharing prices, price comparisons among vendors, order templates and other services.

Search for the Perfect System

Despite the preponderance of today's automated systems, many practice administrators and surgeons are still deciding on the most efficient ways to manage inventory in ASCs.

Stephen Sheppard, managing principal with Medical Consulting Group LLC, Springfield, Mo., who helps physicians spearhead development of ASCs throughout the country, says his company recommends an inventory management software package for large multispecialty ASCs, especially those that include orthopedic surgery.

“But we haven't typically found such a system necessary in ophthalmic ASCs,” he says. “This is primarily because most of the inventory dollars are contained in relatively few items — IOLs, custom packs, and so on — and can be managed manually in a cost-effective manner.”

“We have an inventory management system built by Shared It (Bettendorf, Iowa), using an access data base,” says Julie Shafer, RN, CNOR, CASC, administrator, Spring Park Surgery Center, Davenport, Iowa. “The purchasing manager uses the database to place the orders and maintain designated par levels, but it's all done manually.”

Kevin L. Waltz, MD, OD, partner, Surgical Care Center, Indianapolis, says he has analyzed the potential benefits that an automated inventory management system could provide his center, where six surgeons perform about 2,000 cataract surgeries a year.

“We anticipated that we could save a minimum of 20 employee hours a month,” says Dr. Waltz. “You could possibly save additional time by obtaining more information from an inventory system. For example, we have a large inventory of IOLs that take up a great deal of space. Ideally, we would like to shape our lens inventory based on historical use patterns, which is a difficult to do by hand. With an automated system, it would be a piece of cake.”

An automated system could help the center monitor the “out dates” of products that aren't used often. “We might have three, four or five packs of capsular rings,” he explains. “We could have the same number of vitrectomy packs and a limited number of certain viscoelastics. These products are very helpful but we can't always predict when we'll need them. It's conceivable that we might perform 100 cases in a week and use up our inventory of capsular tension rings. If we use 50 a year, however, how many do we need in one week? The way we settle that question now is by adding extra inventory, which is not the best way to go.”

As a result, Dr. Waltz adds, the expense of inventory is excessive. Capsular rings, a $200 product that's no larger than a box of candy, can easily get lost. “We have lost a lot of small items in our large building,” he notes.

From Modern to Old-fashioned

Dr. Waltz's center tried an automated inventory management system but found that it wasn't compatible with the center's product consignment needs. He and his partners are still evaluating alternative systems.

“So far, we can't find anything we really like,” he says. “So we're back to paperwork and spreadsheets. We don't have a comprehensive inventory system right now.”

Other centers also use a pencil-and-paper approach. Marcia Conely, RN, BSN, director of nursing at Cataract & Laser Center, LLC, Crossville, Tenn., says her center has one operating room and one surgeon, who performs about 120 cases per month.

“We don't have a lot of space or a need for a lot of inventory,” she says. “We try to limit our products to what we would need within 2 weeks. You have to watch your par levels carefully, however, because unforeseen delays in shipments can cause problems. Recently, to anticipate unusual situations, we decided to keep a little more inventory on hand.”

Like other systems, inventory management at Cataract & Laser Center is methodical. “We operate on Tuesday,” explains Conley. “The day after surgery, we do a physical recount to make sure items compare to what we see on our checklist. We lay the items out to make sure we have what we need. By Thursday, at the latest, we place orders. On Monday, we perform a final check, accounting for items that may have just arrived. Doing this in advance saves time and costs. Everything is available for surgery. All we have to do is pull lenses and whatever medications and packs we need.”

Eventually, she adds, Cataract & Laser Center will start using an EMR. “When we do, we may also include an electronic inventory system,” she says. “But this works fine for us now.”

Combining Manual and Automated

Manual processes also work in combination with automation at the Aker-Kasten Eye Center. “We need custom surgical packs for about 2,000 cases a year,” says Janet Nuzzi, RN, at the center. “We have the company drop-ship the packs monthly but switch to as-needed ordering when Dr. Aker is out of town. When he retuns, we go back to 300 shipments per month. The storage needs to be managed carefully. We keep a month's supply on board at any given time.”

Dr. Aker's says smart and frugal management of inventory is a key to operational success. He's one of two full-time surgeons at his center, and both of them use most of the same instruments and products.

“It's important to agree on what products you will be using and how you will them,” he says. “In some centers, surgeons may open and waste viscoelastics and select a variety of IOLs. We use our consumables sensibly. We try to concentrate on a core set of products that will produce the best outcomes but also provide discounts through large purchases. This is one of the best things you can do for your inventory.”

Careless use of diamond blades, irrigation/aspiration tips and vannas scissors and other instruments can result in premature damage, requiring high replacement costs. “Surgeons have to hold themselves responsible for the small but significant things that may not be their primary focus during surgery,” says Aker. “For example, at our surgery center, the other surgeon and I have a practice of opening and closing our diamond blades ourselves, instead of leaving this for our staff to do. Little steps like that can reduce the risk of damage.”

One Person in Charge

Dr. Waltz agrees with Dr. Aker's approach.

“You need one surgeon at a center who really pays attention to these little things,” he says. “If you don't have one person doing that, you'll lose your shirt.”

Dr. Waltz says a surgeon needs to be in this role because he or she knows what's needed and not needed. “Staff takes care of the details of ordering, storage and inventory, but I'm guiding purchasing decisions,” he says. “It's a team effort. The important thing is that it won't happen on its own. The typical surgeon wants to walk in and have everything there. You have to get involved in the supply process. If you're not involved in the supply chain, it's going to break down.” ◊