Through statistical analysis tools and process improvement techniques, hospitals and other healthcare providers can save costs by reducing wasted materials.

1. How Hospitals Can Save Millions
by Cutting Surgical Waste
A Case Study

2. How Hospitals Can Save Millions by Cutting Surgical Waste © 2014 USC Consulting Group, LP

3. The Healthcare Industry Today
• Rapid Technological Change
• Aging Population
• New Regulations

4. Industry Challenge:
Reduce Overall Costs
BUT
Without Sacrificing Patient Care
or Safety!

5. One Hospital System faced this
challenge by calling upon the
Process Improvement and
Material Utilization expertise of

6. Teaching Health System
(name withheld upon request)
• Four Facilities
• 850 Beds
• 600 Practicing Physicians
• 30,000 Annual Surgeries
• $40 Million Surgical Supply Budget
• Primary Objective:
Reduce costs by eliminating surgical
waste

7. Our Challenge:
Optimize the Surgical Preference
Card System

8. The Surgical Preference
Card System
• A typical preference card had multiple items of the
same type but in various sizes (just in case).
• Items were opened in advance for expediency, but
often went unused (i.e. wasted).
• No targeted dollar value of preference cards by
procedure existed, so tracking of variances was not
possible.
• Two different, non-integrated systems were used to
track items; making comparisons of items issued vs.
used not possible.
• No tools existed to help make informed decisions
about what should or should not be on a preference
card.

9. Phase 1.
Data Capture and Analysis
A team from USC Consulting Group (USCCG) installed
the proprietary LINCS® technology solution to:
•
Collect, aggregate and analyze data from the Hospital’s
Perioperative Management Software and Materials
Management System to compare materials issued, used
and returned – across doctors, procedures and facilities.
•
The LINCS reports allowed staff to see which items were
being wasted and why, so corrective action could be taken.
Key Benefit: LINCS provides factual data to optimize
preference cards by statistically validating which items should
remain on each card.

10. “The most enjoyable part of the
implementation was the ease of use and
transition into the new process. Key
relationships were able to be developed
between our team and the team of
consultants. The processes that were
implemented were not difficult to learn
and came with ease of transition.”
Operating Room Director

11. Phase 2.
Process Improvement
Using the data provided by LINCS, the USCCG team was
able to:
•
Implement a color coding process for surgical items. The
colors identify what action should be taken with each item:
No color – Always used and opened in advance.
Yellow – Duplicate item of different size, opened on
Surgeon request only.
Red – Mandatory, but not opened unless needed.
•
Add color coded bins to surgical carts identifying how
items should be handled.
Key Benefit: The cart stocking process is more efficient and
staff is able to focus on more patient-facing activities.

12. “…the LINCS system has made it quicker and
more efficient to track and identify material
issues and take the correct action.”
Charge Nurse

13. Phase 3.
Continuous Improvement
The Action Item feature of LINCS allows for continuous
optimization of the material utilization process.
•
Nurses can identify opportunities during a procedure to
improve material management, utilization or other issues
and input them as an Action Item, as they occur.
•
This electronic repository replaces the previous
handwritten de-brief system, enabling immediate
assignment of issues to owners for resolution within
specified timeframes.
•
LINCS provides alerts to staff when a preference card has
not been optimized.
Key Benefit: Improved communication and accountability
resulting in quicker follow-up, investigation and resolution.

14. “The Action Item tool has tremendously
improved communication and provides
visibility to issues that occur. This gives
us confidence in bringing up
opportunities for improvement as we
know they are not lost in a black hole.”
Surgical Nurse

15. Overall Results
•
$2.3 million annual cost savings
•
15% cost reduction per case across all preference card
items
•
$14.9 million decrease in materials issued
•
$11.2 million decrease in material returned
•
Indirect Benefits:
o
Increased efficiency
o
Improved material handling (pulling, re-stocking, transit)
o
Improved inventory management
o
Better communication, tracking and reporting

16. “Following the processes implemented
and using the LINCS software, I am able
to view multiple reports to assess the
current performance of our OR Material
Usage. The reports allow me to identify
the areas of opportunity for cost savings,
and then apply the correct action to
achieve those savings.”
Operating Room Director

17. A global operations management consulting firm.
We help companies to improve financial
performance by improving their business
operations across the entire supply chain.
Founded in 1968 with offices in the U.S. and
Canada, we are passionate advocates for
business performance improvement.
800.888.8872
www.USCCG.com