As seen in Health Data Management - February 2007
By Margaret Ann Cross, Contributing Editor
When computer systems specialist Michael Maggio joined the materials management department at Woman's Hospital in Baton Rouge, LA., two years ago, his job description was clear: automate the purchase of supplies. Today, small computer programs, or scripts, that mimic employees' keystrokes and follow rules set up in the system are used to process about 80% of the more than 3,200 purchase orders issued by the hospital each year. It purchases $13.5 million in medical and surgical supplies annually.
"We're saving 10 hours of work a day," Maggio says. And that's just processing purchase orders. Using software that enables him to write the scripts-the Boston WorkStation application from Boston Software Systems in Sherborn, Mass.-Maggio also is creating programs to monitor contracts, automate return processes, and manage capital and minor purchases.
"We started with medical and surgical supplies, but we haven't stopped there," says Joe Perez, director of materials management. "We are expanding it out to all aspects of materials management. By automating these processes, we can have our buyers focus more on such things as seeking better pricing and spending time with our customers in the hospital to identify what supplies they truly need."
Materials management was not the first department at Woman's Hospital to use the scripting software. The information systems department purchased the software four years ago and first implemented it in the accounting department. It's now also being used in payroll, admissions, surgical services and other departments, says Daron Johnston, an application programmer who works with accounting and was on the selection committee for the software.
"Anything that a person can sit in front of a terminal and do, we can write scripts for," Johnston says.
Like many hospitals across the country, Woman's Hospital, which has 225 adult beds and 188 newborn beds, has increasingly been exchanging electronic files with suppliers, insurers and other third parties, creating an array of opportunities for computers to do tasks that staff members performed when outside organizations sent over paper printouts, Johnston says.
In accounting, for example, insurers now send electronic remittance files along with payments. The files link the insurer's check to a specific patient account. "Just a couple of years ago, insurers sent us paper files listing thousands of transactions," Johnston explains. "Staff used to go through that list, pull up each patient's account in our computer system, and enter the dollar amount. We have written scripts to mimic that; the scripts read the electronic files, open each patient's file, and enter the amount."
Automating the handling of electronic files in this way makes sense, especially because most electronic files are in standard formats that are easy for computers to manipulate but difficult for people to read, says Armando Hernandez, president at Advanced EDI, a consulting firm based in Canoga Park, Calif. "It also enables employees to change hats. They can take on quality control roles rather than doing data entry."
That has been true at Woman's Hospital, says Shannon Johnson, purchasing and contract manager. "We used to spend all of our time processing orders. Now we have time to do research and offer services to our departments. We can give them options and look for higher quality items and cost savings.
"We have also reduced our error rate because the information is being transferred electronically rather than being typed in," she adds.
Connecting systems
Maggio has written more than 100 scripts for the Woman's Hospital materials management department. To write a script, he breaks down each step in the process he wants to automate and performs each step while the software is copying his keystrokes. He then enters rules that he would like the software to follow while performing the task, such as when the system should send an e-mail alert to a buyer. Boston Workstation features a graphical user interface that enables programmers and other hospital staff to create the scripts and rules.
In this case, the scripting tool is accessing the department's materials management information system, which is from Medical Information Technology, Inc., Westwood, Mass., and is a module of the facility's Meditech hospital information system.
The hospital also is using scripts from Boston WorkStation to automatically send data back and forth between the materials management system and the Westminster, Colo.-based Global Health Exchange, an e-commerce platform that connects suppliers and hospitals. The scripts also send data to the system Woman's Hospital uses to capture supply information at the point it is dispensed. That software is from Par Excellence Systems, Inc., Cincinnati.
"We had a materials management system that had functionality and information, but it had no flow," Perez says. "You would have to manually tell it what to do and when to do it." The scripts have changed that and also given the department a way to update its system in a way that has extended its life, he adds. "This has enabled us to maintain our current materials management information system and improve it without having to replace it. This is a very strong and durable system. We have the best of both worlds-we are able to use the system in a new way and do not have to spend millions of dollars to replace equipment and software."
When Maggio first began automating purchasing activities, he interviewed the department's staff members to understand exactly how they worked. "He had the challenge of listening to all of these different scenarios over and over again, and then we had to say, 'OK, which is the best practice? Which is going to be our standard?'" Perez explains. It took about six months to get the automated purchase order process running smoothly.
Behind the scenes
Maggio has written a series of six scripts to process the purchase orders the hospital sends to vendors. The scripts search the Meditech system once or twice a day for purchase orders that have been entered by various medical and surgical departments. A script then checks the departments' inventories-also kept on the Meditech system-for items that have fallen below minimum reorder points, and it either creates a new purchase order or adds those items to an existing purchase order.
Next, a script examines vendor information to ensure that the purchase order meets minimum order and other requirements. It then sends the purchase orders to vendors electronically or via fax, sending an e-mail notification to buyers only if the purchase order fails to go through. The scripts also send e-mails to buyers if other problems arise that the buyer needs to take care of, such as an order being below the minimum dollar amount set by a vendor. Buyers can then add items to the order or hold it until that minimum is met.
"We have reduced our unnecessary minimum order fees to zero, and those penalties had been costing us more than $300 a month," Perez says.
The department has saved much more money, an estimated $355,000 in fiscal year 2006, by using the scripting tool in its contract management process. Scripts have been written to import contracts into the materials management information system and compare the contracted prices with the cost of the items being purchased. When items are more than 3% above or below the contracted price, employees who specialize in contracts are notified via e-mail so that they can address the issue, Perez explains. "The biggest factor here is cost avoidance. With this system, we are able to avoid getting the wrong price, and that's very important."
Because the scripts make electronic communications easier, Woman's Hospital has been able to increase the number of vendors with which it works. This enables it to search out cost savings and better quality products from a wider variety of sources, Perez says. "This technology enables us to do business with a lot of people without any additional effort."
The system has also helped the department handle increased demand for supplies at the hospital, where 8,000 babies are delivered each year, without adding employees, Perez says. "Our purchasing staff is bare bones. We have two buyers who handle the medical and surgical purchasing, and if I didn't have this tool in place, I would definitely have had to add one or more FTEs to keep up with the volume."
