Healthcare Innovation: At Arkansas Children's Hospital, Optimizing Medical Device Parts Management

At Arkansas Children’s Hospital in Little Rock, Boyd Hutchins, director of healthcare technology management, has been leading an innovative process to optimize medical device parts management

CLEVELAND, September 2, 2021 – How are senior leaders at hospitals nationwide leveraging data and information to help them manage medical devices? At a time in healthcare when every cost needs to be scrutinized and rationalized, leaders at Arkansas Children’s Hospital in Little Rock, Arkansas, have been saving $10,000 a month in cost savings on repairs and a 65-percent average cost savings per repair, per medical device. Faced with extended return times for – averaging 88 days – frequent recalls and price increases, the hospital turned to the Aurora, Ohio-based PartsSource, a healthcare services online marketplace and largest provider of medical replacement products, to obtain a platform that could provide data-driven decision support to simplify the procurement of medical device products and services from an evidence-based marketplace. With the recent addition of more than 1 million facilities products to support clinical engineering and facilities management healthcare teams, the hospital can purchase facilities products to manage costs, ensure quality and reduce staff time spent procuring equipment.

Recently, Healthcare Innovation Editor-in-Chief Mark Hagland spoke with Boyd Hutchins, the director of healthcare technology management at Arkansas Children’s Hospital, about his eight-engineer team’s strategy to optimize the management of the two-facility, 348-bed hospital’s 14,000 medical devices. Below are excerpts from that interview.

Tell me about the origins of the development of your strategy to optimally manage your organization’s medical devices?

This really started about three years ago. As a department, we decided that we needed to run things a little bit more efficiently, know what we had and where we had it, what we were spending. We were a high-functioning department We moved to Lean manufacturing principles and into an Agile framework, in our IS division. We started this journey back in 2007 in HIT, for maintaining medical equipment. We’re using what works from those kinds of methodologies.

We shifted in phases; first, we turned to one computerized medical management system, which represented a big change for us; and then we turned to PartsSource. As we began mapping our situation, we performed some time-and-motion studies as part of our Lean methodology, and found that our technicians were spending a lot of time on the phone shopping for the best prices for devices, and negotiating with vendors on prices, and it was bogging us down.

Those time studies showed we were wasting close to an FTE a week on the phone, placing phone calls. And if we had to call an original equipment manufacturer (OEM), that would have been even worse. So we connected with PartsSource; they’re kind of the Amazon for medical parts. There’s no website interface; we have access to their catalog.

And we’ve limited our choices to the OEM part; and they have quality metrics around their parts, including on-time delivery and part quality. So we allow for an OEM and a third party. So my technicians really don’t have to think about what they’re going to buy; they just click on the part, and purchase the order. They have the corporate credit cards uploaded. So that’s reduced drastically the amount of time we spend shopping for parts.

How big a team is shopping for parts?

It’s our entire team of technicians—eight people. That small size of our team speaks to the Lean and Agile methodologies we have in place.

What have you learned around process, in all this?

One thing we’ve learned lessons about, and something some of our old-school biomedical engineers struggle with, is the idea that if they call a local vendor with whom they have a relationship, they might get something cheaper. But what we’re learning is that if we leverage volume, even if we can’t find a one-off supplier that says, I can sell you this widget for a little less, we funnel all of our purchases through PartsSource. And over the course of the year, we’re actually saving money even if we pay a little bit more for individual parts. Their program is so efficient and cost-effective; I refuse to pay my technicians to fix infusion pumps. If it takes more than an hour to fix an infusion pump, we can save money over that. So we’re saving money and providing higher quality, because now we’re ensuring quality. That’s hard for some of my technicians to take, because they want to fix things, but most of them buy into it.

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