RTLS Enables and Enhances a Centralized Asset Management Strategy

by Scott Hondros, VP of Client Success at Infinite Leap

As I work with hospitals across the country, I see a lot of different approaches used to manage mobile medical assets. In my opinion, none have the potential for success like those executing against a centralized Asset Management Model. My thoughts below are on what can be expected, from a high level, when using Real-Time Location System (RTLS) as part of the solution.

Within hospitals, staff typically have a preference to not just find “any stuff” but rather “their stuff.” However, the practical reality is that when looking for a wheelchair, what you really want is to find the proper chair to help a patient. In a perfect world it should not matter if this chair is owned by the ED or some other department in the organization. What is important is that you find a chair that is available as efficiently as possible. For this reason, it makes sense to NOT assign general use equipment to a specific department. In order to accomplish this, you need to have a system and associated processes in place that actually make it convenient and are reliable in matching “wheelchairs and patients.” Unfortunately, the process shortcut that many hospital systems take is assigning specific equipment to individual departments, which does not solve the core problem, and instead causes hospitals to over-purchase equipment and promote an unhealthy “it’s mine” mentality.

Healthcare organizations who have made the change to a centralized asset management strategy and who leverage real-time technologies to make it work, admit that it required a cultural shift but it paid large dividends. The reason that RTLS systems make a centralized asset management strategy possible is that people will continue to claim ownership of or hide equipment UNTIL they have full confidence that what they need is actually available when they need it – and that’s what RTLS provides. Until that happens hoarding and over spending on mobile assets will continue.

The natural benefit of a centralized asset management structure is that a single pool of equipment is available for use by anyone in the organization.When properly functioning, everyone is able to access the equipment they need. This central pool also enables a smaller inventory of equipment to serve the same or even increased needs. To optimize the utilization of each type of equipment, accurate data is required and staff need to trust that they can get what they want when they need it. In general, utilization rates of every asset type will increase, yet overall management costs will go down because there should be less equipment to maintain and/or hold service contracts on. On a healthcare system level, annual replenishment spends typically see a significant reduction the first couple of years and then it stabilizes to maintain a more forecastable and manageable level over time.

We see this work so well that healthcare organizations we work with are even creating centralized control centers (sometimes referred to as “Mission Control”). These teams are able to respond immediately to equipment needs and replenish the inventory stock based on projected demand. They also look at utilization rates in great detail, and are able to understand by whom and in what areas equipment is most utilized. This insight allows process improvement teams to focus on processes, and not on doing laborious and painful data gathering.

A terrific example of benefits the RTLS system can provide is a success story that the Director of Equipment Distribution for a large medical academic center recently shared with me:
“Using RTLS data allowed my staff to better define par levels and as a result make smarter more efficient “milk runs” to round up equipment from around the facility – all with less staff than was previously required.”

Our healthcare clients who have made the switch to centralized asset management have seen a significant reduction in rental spend. This has happened by making sure that equipment is only rented when the hospital doesn’t have an available and appropriate device already in inventory. And, these systems also make sure that they don’t continue to pay rent on equipment long after it is no longer needed, due to an inability to locate and return the rented device.

For example, since using RTLS to locate several thousand mobile assets, a major hospital in the Dallas/Fort Worth area has experienced significantly quantifiable reduction in their rental spend. The Director of Clinical Engineering and Sterile Processing stated that “we have not rented any of the assets types we placed RTLS tags on.” Given the significant savings and the well documented results, Senior Leadership readily provided additional funding to expand the scope of the RTLS system to tag several thousand more items.

IN SUMMARY there is no doubt that a centralized asset management program in a complex healthcare environment reduces costs and ensures patient safety. Likewise, there is no doubt that making a centralized management structure work successfully can be very daunting… in fact, I’m not sure how I’d operate in that setting without the visibility that an RTLS infrastructure provides. You simply need the exposure to real-time data to allow a centralized model to be successful. And when you make it work, it delivers significant financial, operational, and care benefits that cannot be disputed, including:

  • Equipment is where it needs to be so that it can be accessed easily.
  • Efficient and effective preventative maintenance programs that experience a 90% reduction in the time it takes to round up equipment.
  • Reduction or even elimination of rental spend
  • Social changes and reduction in silos within the hospital as everyone sees the value of collaboration and sharing of equipment and resources.

If your organization is considering whether a move to a centralized equipment management structure is doable and worth the effort – let’s talk. We’d love to share what we’ve seen (good and bad) at other organizations, and help illuminate the benefits of using real-time technologies to make the transition as effective as possible.