A smarter healthcare supply chain data management solution. Great savings up to 87% for a client after 12 months.

Executive Summary

This project is a supply chain solution developed by LARION for Customer G. In the United States, medical-surgical product information is always changing, making it hard to align contracts and take advantage of reimbursement opportunities. This solution helps Customer G’s clients achieve more accurate, up-to-date and standardized data within their materials system. The result is significant savings, which could be as high as 87%, derived from reduced errors and better contract alignment, plus the ability to increase reimbursement revenue.

About Customer G

As the largest community of healthcare supply chain trading partners in the United States, Customer G connects supply chain, finance and clinical professionals with their suppliers and partners. The 4,000+ provider organizations and 400+ manufacturers and distributors in this community are working together to drive billions of dollars out of the cost of the healthcare supply chain in the US.

Challenges

• Each year, it is estimated that 10 million changes are made to medical-surgical products on the market in the U.S. Therefore, the resulting item master errors have far-reaching impacts on operational and financial performance, from over payments caused by contract price discrepancies to lost revenue from missed reimbursements.
• Effectively managing supply chain processes is no longer as simple as data cleansing and item master maintenance. Today’s dynamic healthcare environment requires excellent content management throughout the entire supplier-to-patient process. Providers need data that supports, enhances and connects all hospital systems with minimum maintenance and redundancy.

The Solution

• Customer G’s Content Management Solution drastically reduces manual item master maintenance by synchronizing, cleansing and enriching an organization’s item master data with product and pricing information derived directly from medical-surgical manufacturers and GPO (group purchasing organizations). This system is a cloud-based VIM (virtual item master). It continuously monitors an organization’s item master for changes and updates, and then corrects product data inaccuracies, removing duplicates and filling in missing information to help reduce transaction errors.
• Furthermore, by attaching Healthcare Common Procedure Coding System (HCPCS) codes to product data, this system can help you provide reimbursement details that can be used to capture additional revenue.
• Lastly, this platform is a complement to other Information Systems of a healthcare institution, such as ERP, MMIS, EMR, etc. to utilize global standards published to the Global Data Synchronization Network (GDSN).

Customer G’s platform provides clients with the following main features:

• Continual data cleansing and conditioning
• Tools for removing, adding and customizing data
• Capabilities of maintaining multiple data descriptions
• Access to an industry-wide catalog of 800,000 items
• Ability to link HCPCS codes to products
• Option to incorporate item updates and GSDN attributes into systems
• Insight reports into spend, relevance and consistency

The key benefits of this platform are as follows:

• Keep product information up-to-date
• Always let clients know what they buy and from whom
• Lower supply costs through higher contract utilization
• Increase potential additional revenue through reimbursement
• Reduce transaction errors
• Align the supply chain activities with financial and clinical goals
• Link item masters to GDSN attributes, including the Global Trade Item Number (GTIN)

Technologies used in this project:

• Data Identification & Discernment utilizing Artificial Intelligent S-O
• Data Normalization and Standardization utilizing Objective Text Mining
• Web Crawling technology
• Javascript, Ruby & Lisp
• Database: PostgreSQL, AllegroCache

Results

Within the first 12 months of using Customer G’s solution, the Medical University of South Carolina (MUSC) avoided US$1 million in costs stemming from inaccurate data and inefficient processes and secured US$370,000 in savings related to contract and tier price compliance.

• Using this system, Customer G assigned Healthcare Common Procedure Coding System (HCPCS) codes to the products within MUSC’s item master, helping it to be reimbursed appropriately for products used in procedures.
• By integrating its item master with its charge master and providing users with easy access to detailed product descriptions, MUSC is driving greater accuracy in the billing process and in turn, helping to ensure it is receiving adequate reimbursement from CMS and the other payers.

At Saint Francis Hospital and Medical Center (SFHMC), the supply chain team reduced non-file spending by 87 percent (from US$33M to US$4.3M) within 12 months of implementing this solution of Customer G.

• One way SFHMC achieved this was to standardize product descriptions using United Nations Standard Products and Services Codes (UNSPSC) and input from clinicians and nurses so clinical staff can easily find the products they need within the item master, which minimizes off-file purchases.
• Standardization by UNSPSC also enables SFHMC to analyze its spend by product type, class or category and determine which vendors it is purchasing from within each category.

Quotes

“LARION is a good company to do business with. The management is strong and the processes are well thought out.”