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Addressing OR Challenges Through Smart Instrument Purchasing

Fri, 07/15/2011 - 5:03am
Robert Edelstein, CEO, Millennium Surgical/SurgicalInstruments.com

Hospitals and ASC staff face frustrations, from reduced budgets to obscure instrument requests to mergers and hurriedly-added specialties.  One solution:  Find an informed supply partner.

July 15, 2011

Hospital ORs and ASCs (ambulatory surgery centers) must confront more than their fair share of challenges in the current healthcare environment. Many facilities are working with limited capital and non-capital budgets; facilities have cut back on spending.  Volumes of surgical procedures have been reduced as a notable percentage of people are unexpectedly without insurance due to job losses.  Those patients are procrastinating on surgical procedures while they search for new employment. 
One potential solution is to delegate time-consuming, non-care-related tasks, such as instrument purchasing duties, to an educated partner.  Here some challenges that representatives from Millennium Surgical, a 20+-year provider of high-quality specialty surgical instruments, have observed from the field, scenarios in which OR staff responsible for researching and ordering have been able to save considerable time and resources.

Challenge 1:  Navigating a Complicated Industry
The surgical instruments used in procedures have gotten more complex and specialized over the years.  Millennium has seen the number of instruments in the typical vendor catalog increase by approximately 30% in the past five years, giving nursing administrators many more choices to pore through in making purchasing decisions.  In addition, hospitals typically hold multiple surgical instrument contracts covering small amounts of instruments each.  Those contracts, and the vendors they cover, change frequently.  Individual instruments are discontinued on a regular basis.  And to top things off, acquisitions and vendor name changes abound in the industry, making it difficult to track down specific requested items.

For example, a nurse recently called Millennium looking for a Richards ear knife, which was once supplied by Smith & Nephew Richards.  As it turns out, Richards ENT instruments are no longer sold through Smith & Nephew Richards.  Instead they are sold through Gyrus ENT — which was recently acquired by Olympus Corporation, and is now Gyrus ACMI.  

Thanks to Millennium’s knowledge of these industry transitions, and the company’s ability to quickly supply the required ear knife, the nurse in question was able to replace her lost knife immediately instead of devoting significant time to tracking down the instrument’s latest manufacturer.  In contrast, some larger instrument companies utilize customer service call centers that leave busy OR staff on hold, sometimes with minimal end-results.  Millennium’s office is staffed 10 hours a day, five days a week, allowing the OR staff to immediately reach a knowledgeable product consultant.

Challenge 2: Adding Services to Chase Dollars
As the industry gets more competitive, hospitals and surgical centers have felt the pressure to add services that yield higher reimbursements and greater profit margins, such as spinal procedures, which could bring up to $10,000 in reimbursements per surgery.  Some facilities have acquired smaller centers that are already established in an attractive specialty.  A popular and less expensive alternative is to add the new discipline to the existing hospital or ASC’s current business model from scratch.  This requires the staff to assemble unfamiliar and often complex new sets of instruments. 

Not an easy undertaking for an overtaxed OR administrator, who must maintain current quality of care at the same time. Often new specialties means new vendors, instruments the staff may be unfamiliar with, and instruments that are hard-to-identify and source.  
Nursing administrators tend to wear many hats in the current economy, making it difficult for them to take on time-consuming tasks like researching instruments from a plethora of vendors.  In addition to simply locating the correct instrument, administrators must still compare several different branded versions of the same instrument for price, since a single instrument is branded by various manufacturers at varying price points. 

An ambulatory surgery center in Cape Girardeau, Missouri, devised a cost-effective way to add a lucrative spinal specialty.  They arranged to lease part of an existing building and turn it into a spinal center, to be open a limited number of days per week.  But when management wanted the new addition up-and-running as quickly as possible, the purchasing administrator had to obtain close to $60,000 worth of retractors, curettes, rongeurs and other specialty instruments, all within a 30-day period.

Challenge 3:  Finding a Consultative Partner, as Opposed to a Salesperson
The purchasing agent in question knew only some of the brands of the instruments she’d been asked to acquire.  The list of instruments she was had been provided included minimal distinguishing details.  Regardless, the ASC was under the gun to stock the new center, so the purchasing agent sent pages and pages of lists to a multitude of suppliers.  She expected to have to piece together several hit-and-miss responses from those different suppliers, each only identifying a small portion of the items that were needed. 

The ASC turned to Millennium as a partner with a broad-based knowledge of the surgical instruments market.  The case would be a challenge for most suppliers, but for an educated consultant, the goal is to do the research on the customer’s behalf and provide a comprehensive list of instrumentation and pricing.  Millennium was able to identify 100% of the eight-page request list in a single day.

Challenge 4: “Order Me the Humma-numph,” And Other Surgeon Requests
According to many nursing administrators in the OR, surgeons can be adamant about their preferences – but their requests can be vague and mystifying.  As staffs merge and doctors move from facility to facility, surgeons often demand that a certain set of surgical instruments be reproduced in their new OR.  Yet few of them know what vendors make what instruments and where they came from. Operating room personnel are left to figure that out on their own.  One nurse administrator recently contacted Millennium armed only with the doctor’s nickname for an instrument and a general description. The message to Millennium said simply: “Looking for a carpal tunnel knife. 
A fasciatome. Any ideas?” 

Millennium’s product consultant relied on 23 years’ experience working with OR staff and specialty surgical instruments.   After some significant investigation with several different manufacturers, the product consultant was able to locate the exact instrument the administrator had been looking for:  a Paine’s Carpal Tunnel Retinaculotome knife, which the administrator was able to confirm via a product image the Millennium consultant provided.  The consultant’s work literally saved the purchasing agent hours of independent research—without any additional extra cost to the purchaser.

Some purchasing agents have had little more than pencil drawings or hand gestures with which to communicate the exact instrument they need to find, while faced with instrument catalogs that include many thousands of instruments.  Millennium Surgical been able to identify instruments based on these kinds of ethereal descriptions, and often under time constraints that would hamstring many an administrator working on his or her own.

An educated, consultative partner can be a valuable resource for an OR manager, allowing them to meet their sourcing deadlines without having to dedicate in-house resources to the time-intensive task of researching specialty instruments.  In a complicated industry that is staring down wholesale changes, facilities should welcome the chance to delegate their purchasing projects to a trusted market associate.

Getting The Most Out Of Your Surgical Instrument Purchasing Process

Practice intelligent cost-cutting. Identify target areas that will significantly help your center’s bottom line. Cutting costs on the purchase of handheld retractors, sponge forceps, towel clips, dressing, tissue forceps and basic hemostats will not directly affect surgeon satisfaction, where as a lesser-quality rongeur might have a greater impact.

Selectively invest in quality. Certain instruments, such as needle holders and scissors, are more likely to breed surgeon contention than others if quality or maintenance is sub-par. Purchase the highest grade of these and similar instruments, and your surgeon and staff satisfaction will rise.

Maintain accurate expectations of instrument utilization. If you hear of new surgeons or new procedures coming to your facility, research whether you will be getting a strong ROI before filling an instrument “wish list.” 
 
Compare costs:  Old habits die-hard; surgeons will often request a specific instrument solely by brand.  It’s important to determine if that item must come from that specific vendor.  If the vendor name or part number was for reference only, then you have an opportunity:  Many US surgical instrument suppliers outsource their manufacturing to a number of companies. This means that identical instruments are multi-branded and sold at varying costs, creating an opportunity to get the same item for less money.

Streamline your purchasing. By focusing only on the instruments you need, you’ll save thousands of dollars. Sets are often designed by instrument companies and include unnecessary parts.  For example, when buying a Bookwalter-type ring, target only the necessary components and avoid complete sets.

For more information, visit www.millenniumsurgical.com or www.surgicalinstruments.com

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