UCHealth – Colorado

As a system, UCHealth was inspired to increase the efficiency of its supply chain. So, in 2016, they committed to a Kanban journey. At the beginning of that journey, they began to research and visit other health systems to discover the best practices in the market. That was before they were fully organized as a system.

Some campuses and supply rooms still had antiquated weighted bin and jitterbug systems. Other campuses and supply chain areas had min/max order points. They were counting and reconciling product counts multiple times every single day. Not the most efficient way to serve clients, nurses, and clinicians.

How it All Began

As they were exploring the next phase and researching best practices for supply chain efficiency and cost containment, Kanban kept resurfacing. “One of my peers, who is now one of my managers, and I were instructed to go figure out Kanban to see what it’s going to do for us,” said Matt Putman, Director of Supply Chain Operations at UCHealth.

The simplicity is what makes it very usable and sustainable.

“We set out to observe a few organizations which had started Kanban implementations; Nebraska Medical, Sisters of Charity Leavenworth (SCL), and learned some very interesting lessons. It’s not a very complicated system but it can get as complicated as you make it. The simplicity is what makes it very usable and sustainable. Not only from a supply chain perspective or the order entry management process but more importantly, from the end-user or nurses’ perspective,” added Putman.

“Given the fact that we were directed to go forth and conquer Kanban, we started figuring out how to do it on our own,” Putman said. They relied heavily upon their ERP data to provide some of the analytics.

“Our ERP had some positives, but more negatives. You can pull your data in real-time. But to get real accurate utilization data in inventory reviews, you must go back at least 30-days. You have to wait until the month-end is done and the reconciliation of inventory has been completed. So, your ability to have actionable data is not nearly as available because of the month-end process with all of the ERPs alone.”

Trying to make real-time decisions working from old data just doesn’t work that well.

Putman continued,

“Our DIY Kanban build wasn’t a real Kanban build. We already had a sunk cost in Metro wire racks and bins, but because of how we had built our previous par locations, it was multiple items in a bin, and all we had were the 24-inch-long bins. When we started figuring out Kanban order points, replenishment in both LUM and bulk, and multiple POU areas, we wanted to achieve our Kanban journey with as much of our small budget as possible. It was going to be such a financial impact that we had not budgeted for, but we didn’t want to wait on our Kanban implementation and the benefits it provides.”

Plus, BlueQ Analytics’ dashboards are also very user-friendly. No worrying about trying to extrapolate it, run pivot tables, come up with data references, index it, etc.

UCHealth started with the 24-inch-long bins, put a divider in the middle, and had pull stock and safety stock. One lesson learned from the health systems they visited was, those bins walk! It is easy to put a shorter bin under your arm, go stock the nurse server, and set it down. Some bins are never found again. Putman said, “We decided to go ahead and try to continue on our budget approach and take some of the lessons from each of these other health systems.”

In 2017, Putman met Robb Swan, BlueBin CMO, at the AHRMM Conference. “He was telling me everything about the BlueBin 2-Bin Kanban system and what he thought would work for us with BlueQ Analytics to run it.”

Matt thought this sounded great but what they really needed was the BlueQ Analytics data. They knew real-time data is extremely important for making data-driven decisions. Plus, BlueQ Analytics’ dashboards are also very user-friendly. No worrying about trying to extrapolate it, run pivot tables, come up with data references, index it, etc. BlueQ Analytics is real-time, actionable optimization reporting that is sustainable.

Fast forward, UCHealth engaged with the BlueBin 2-Bin Kanban program for their supply chain organization. Some areas were already nearly there and were retrofitted. Other areas became a full BlueBin 2-Bin Kanban build. The main campus, UCHealth Anschutz, having just under 700 beds, is currently on the BlueBin journey and should be open by the end of 2023 (1000 beds). “It’s a very large facility and we are using BlueBin to replace the antiquated Parex tab system. We are currently tearing out all of the existing supply rooms and having BlueBin install their Kanban system,” added Putman.

UCHealth had also utilized Pegasus racking in the past and was able to repurpose and create a Kanban-style, front bin/back bin type of methodology. The engagement with BlueBin, for several of their facilities was for BlueQ’s advanced analytics. What makes BlueQ Analytics so powerful is the real-time information that updates daily, allowing you to make real-time supply chain efficiency decisions from actionable insights.

Operating Under a New Paradigm

When COVID-19 hit, UCHealth was utilizing BlueQ Analtyics daily to see where stock levels were, real-time inventory, among other things. They were also making use of the Huddle Board. “The team likes the idea behind it because, again, it gives you that real-time information, cone deployments, and such.”

It provides talking points that are more relevant versus just How are things going today? Which is a very qualitative type of question. “You can get into the quantitative analytics of here’s where we have pain points, here’s where things are going, we’ve had to deploy here and here. That’s where we found a lot of the benefit of having it.”

Whether it’s in a supply room or not, it has made it so we have that information literally at our fingertips.

Putman went on to say, “I was talking with one of the managers last week and we were going through the Gemba Audit walk with the BlueQ Analytics module already set up for lean standard work.” With BlueQ Analytics’ ability to take photos, he said, “You know it’s going to be really powerful to be able to take the photos, do the Gemba walks, and then have the discussions with the unit managers when they do their semiannual reviews of the inventory utilization. Being able to point out Here’s what the stat call detail is. Whether it’s in a supply room or not, it has made it so we have that information literally at our fingertips.”

Not wanting to let a pandemic stop them from continuing to progress the fiscal management of the organization, they implemented a service-line methodology in the four northern Colorado hospitals.

Using BlueQ Analtyics’ slow/stale reporting, they began a structured approach to finding ways to remove much of the slow, stale, never-scanned deadstock and optimize par levels within the ED service line, resulting in another ROI metric. It is the same positions, the same care providers benefitting from the efficiencies.

As Putman and his team started digging into the reporting details, they found some issues in the inventories:

1. There was a lot of extra stock, which means funds are tied up in stock they didn’t need any more
2. There was some variation in the products. Why was there variation when it’s the same staff and the same rotation of folks, all over the place?

They were able to utilize BlueQ Analytics information to train end-users to help with data analysis. “In supply chain, we’re not typically clinicians, so we can say, ‘Look, we’ve got some stuff that’s been on the dead stock tab or the never-scanned stat tab for many months, even years,’ and you can have one nurse that says, ‘Well, we might need it,’ and I don’t have a clinical response for that except for, ‘You might. But you might not,’” adds Putman.

He engaged clinical end-users to pull some of the data, look specifically at some of the BlueQ Analytics slow, stale, never scanned dashboards, and make some clinical decisions around:

• Why do we have it?

• Do we need it?

• Was it a change in practice?

By the end of that section of the project, UCHealth was able to remove a lot of unnecessary stock and spending.

“Several of our ED locations went from an item utilization around the 60-something percentile according to the BlueBin daily utilization dashboard to upwards of 90 now. Which is a very significant utilization increase! Plus, it sets us up on the road to success with standard practices. Now we have the foundation in place where we’re able to go back and review this on a semi-annual basis with the end-users to look at those slow, stale, never scanned.”

“I was talking with one of my managers over at our Greeley hospital and he said that they were looking through their BlueQ Analytics data last week and they were down to only 50 hot items over the past 60 days in the entire hospital. That’s a 53-bed hospital. So, to only have 50 items that were listed as hot was pretty significant.”

BlueQ Analytics’ reporting of hot items is what helps keep hospitals from never stocking out. Supply chain teams can optimize pars quickly to never stock out, and never expire.

At the end of the day, the partnership with BlueBin and the use of advanced analytics through BlueQ have been really powerful for our organization.

“When we report up to our executive leadership about what we’re doing from a par optimization standpoint, I continue to look back to our hospitals on what we did from an item removal standpoint. Of the EDs alone, we were able to take out almost $5400 of dead stock. Dead-weight stock that we all kind of knew was there. Without the upfront data and the ability to show the real-time data, stat calls, etc. through BlueQ Analytics, it was never really hammered home.”

They had set goals around this. What’s a reasonable amount they could remove? Could they remove three percent? Five percent? That $5400 encompasses 16 percent of the total inventory valuation. They achieved a 16 percent cost reduction!

Because they work in a bulk inventory environment, they returned that to the main storeroom and distributed the rest to other end-users who were going to use those items. “At the end of the day, the partnership with BlueBin and the use of advanced analytics through BlueQ have been really powerful for our organization,” continued Putman.

What Does the Future Hold?

I see it as a partnership, or I should say relationship, with forward-thinking technology vendors, where we can start building out what it looks like to get to the sweet spot in all aspects of the hospital supply chain.

One of their hospitals is going through a three-year facelift because it is one of the oldest hospitals in their system. Not just doing cosmetic changes but also a number of supply rooms are going to be remodeled as well. “We plan to mirror a lot of the efforts that were done with the ED service line with the service lines at the other facilities. As those remodels are taking place, we can revamp everyone’s inventory, find the rate of utilization, remove the dead stock, etc.,” said Putman.

There are significant savings to be found out there. “Just looking at the slow, stale, never scanned at those hospitals, we’re upwards of close to a million dollars. If we just took out that slow, stale, never scanned as a blanket we would have probably close to a million dollars of product that would be coming out,” concluded Putman.

Final Thoughts

“I see it as a partnership, or I should say relationship, with forward-thinking technology vendors, where we can start building out what it looks like to get to the sweet spot in all aspects of the hospital supply chain.”

UCHealth is just one of the hundreds of hospitals in which BlueBin’s systems are currently deployed. Our goal is to help facilitate the lean journey for as many healthcare institutions as possible, allowing them to see significant savings in terms of costs, space utilization, and clinical workflow optimization process improvements.

BlueBin’s mission is to dramatically improve healthcare – adding value to the supply chain process by ensuring clinicians have the right supplies at the right time, maximizing efficiency.

Our solution fuses cutting-edge technology with lean methodologies and principles, providing an operating system for managing all medical supplies, in all areas of the hospital or healthcare environments.