Does RFID Tagging Help Hospitals Save Money?

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RFID-thumb1One hospital near Albany, N.Y., has seen annual savings upwards of hundreds of thousands of dollars after implementing a medical-equipment and patient tagging policy, reports Philip Betbeze of HealthLeaders Media.

Ellis Medicine first started to zero in on efficiency and cost reduction in 2008 when it merged two community hospitals, “driving heavy volume to the remaining facility’s emergency department and general patient population.” Chief Operating Officer Paul Milton said the merger forced them “to do as good a job as possible to make sure the patient flow and length of stay and discharge worked really well.”

Milton first looked at how nurses were spending time with patients. He wanted to ensure that they weren’t busily searching for equipment, such as IV pumps, in lieu of interacting with patients. This led to a partnership with GE, which introduced him to RFID tagging and demonstrated how he “could work to reduce nurses’ time spent locating equipment.”

RFID tagging revealed that the hospital had too many devices, 500 IV pumps total.

According to Milton, “Once we redid the workflow and we tagged all the pumps, instead of needing 500, I [realized we] only needed about 340. That value was roughly around $400,000 a year. Multiply that by three years and that’s where you get $1.1 million. We used those savings to purchase the technology.”

He then targeted patient wait times in the ED, taking into account all of the departments involved in moving a patient efficiently through the system and applying CMS’ two-midnight rule. This brought about patient-tracking tags.

Betbeze writes, “RFID tags on patients track them from the time they register at the ED to the time of discharge either from the ED or from an inpatient room. Implemented only three months ago, Milton says it’s too early for definitive results on wait times, but he will soon have more data he can review on those metrics.”

The savings from equipment and patient tagging have led the organization to establish a no-wait culture. “Whether with value-based purchasing or specifically with HCAHPs, we look at wait times from an ER patient from the time when they’re registered to when they see the physician, to when the decision was made to admit, to when the patient gets to the room. Those stats we look at daily,” Milton said.

The next step? RFID employee tagging.

“I’m willing to be an early adopter with minimal financial risk to test out this technology, which records whether caregivers go into patient rooms without using the sanitizing dispenser,” he stated. “I’m going to know if you’re doing that. If that reduces infection rates, we’ll save a lot financially and also the patient will be safer.”

-by Pete Fernbaugh

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