Aurora Health Care

Centralizing Parts Procurement Saves Money, Increases Technician Productivity
Article by Jill Schlabig Williams | August 2009 | download PDF >

Based in Milwaukee, Wis., Aurora Health Care is Wisconsin's largest, fully-integrated, not-for-profit healthcare delivery system.

Established in 1984, Aurora has become a nationally-recognized leader in efforts to improve the quality of health care. Over 90 different communities benefit from Aurora's integrated delivery network, comprised of 13 hospitals, over 100 clinics, and 120 community pharmacies. The 25,000 employees and 3,400 affiliated physicians who make up Aurora work together with one goal in mind — to always provide benefit to the patients and communities they serve.

Operating with Efficiency
Like many healthcare providers, Aurora faces enormous pressure to improve the quality of care and manage to a healthy bottom line, while maintaining an eye towards growth. Declining
reimbursements and climbing capital expenses are also a reality and are continually factored into the financial and operational plans of the health system. Aurora's not-for-profit status means that the organization cannot obtain funding through private sources or shareholders. Thus, funding quality and growth has to be the result of more innovation and efficiency at all levels of business operations.

For Patrick Trim, director of Capital Equipment Services, and his Clinical Engineering team, efficiency coupled with service value was already part of their operational day-to-day standards. Having led the centralization of all of the health system's 44,000 pieces of mobile equipment into a single asset management solution, Trim could site numerous examples of the cost savings the health system derived from this approach. Through one single capital asset system, St. Croix Systems Asset Manager solution, Aurora's capital equipment team is able to deploy, track and maintain assets, consolidate and evaluate vendor contracts, review asset performance, calculate total cost of ownership and useful life, and plan for and budget capital for new and replacement equipment. And because it is an enterprise wide solution, as Aurora grows, inventory is seamlessly integrated, giving visibility to every piece of equipment owned or leased — from the enterprise, to a hospital, to a clinic. With an asset optimization infrastructure in place, the only other place the Capital Equipment department could look to for driving greater efficiencies was through more strategic use of personnel.

Innovation to Support Growth
When you're a prominent and growing health system such as Aurora, overall operating objectives inherently include incorporating process improvement and innovation, and leveraging economies of scale. It's quite possible, however, that these objectives might not always be met through internal resources.

"When you have a health system the size of Aurora, you are mindful of outside organizations positioning to executive leadership the value of their outsourced services," says Trim. "With that thought in mind, I saw it as the department's role to determine how we could add to the efficiencies and service standards that we were already contributing — and to do so with a level of innovation that could be easily implemented with greater value than what could be provided through externally-contracted resources."

If you are Aurora's Capital Equipment operations, responsible for managing over 44,000 pieces of equipment, your first priority is making sure all capital equipment is safe and operable. Your next priority is ensuring that clinicians, and more importantly, patients, are not inconvenienced by having to wait for the delivery or servicing of this equipment. As the executive leader of the operations, Trim mobilized his department's leadership team to develop a plan that would prioritize responding to the health systems' geographical expansion, manage and maintain more sophisticated equipment and technologies, and add to the 100% visible. 100% measurable. 100% productive. 100% visible. 100% measurable. 100% productive.

Aurora Health Care
Healthy Savings with Capital Asset
Lifecycle Management Strategy
Case Study
service standards the patient care resources had become accustomed to.

At first glance, an easy choice would be to hire more resources, enter into more third-party service contracts, or both. But what was the long-term gain? "We could have hired additional engineers and placed them within the various regions, but to get to the next level of efficiency in support of the system's growth, we needed to implement a model that allowed us to meet demand, reduce costs, and support standards needed to deliver safe and quality care," stated Trim. "By approaching the health system as a whole, versus different geographically based
entities, it allowed us to rethink our existing processes. We were able to leverage the data provided through our enterprise asset management system to determine where specific expertise was needed, where dependencies on third-party service agreements could be reduced or terminated, and how all of this could be managed so we could maintain a higher level of service throughout the entire environment of care."

With these guiding principles, a plan was devised that would use a centralized service management call center to facilitate the intake of all service requests, dispatch resources, and manage technician scheduling. This integrated approach would provide the catalyst for reorganizing the resources and ensuring resource productivity for both the existing and new headcount they would add to address geography, modality and expertise. Confident in the value that would be derived from this approach, Trim assured senior executives that he could reengineer his organization, add headcount without adding costs, lower costs by reducing or eliminating reliance on specific vendor service agreements, improve the overall service to all hospitals and clinics within the network — and do it all within eight months.

Eight months later, Trim and his team delivered. Aurora has a fully-engineered Capital Equipment department; a fully-deployed centralized service and dispatch center, complete with all the metrics necessary to measure service performance; 19 additional headcount and a $1.5 million dollar contribution to the bottom line — all funded by the $3.5 million dollars in contract savings.

Creating a Foundation for Consolidated, Centralized and Integrated Operations
The decision to consolidate and centralize was the right strategy for Aurora. Their success was a result of a solid foundation of proven business processes, a focus on asset and resource optimization, and a defined list of requirements. They were looking for a solution that would:

After an exhaustive search, Aurora found only one off-the shelf program that met some of the call center requirements but very little of the healthcare service dispatch functions. With an eight-month timeline, the customization and integration efforts would be too large and too complex, and would still not be specific enough to Aurora's healthcare environment.

Having already built their enterprise asset management strategy around St. Croix Systems solutions, Aurora had strong trust in the software company's products. They decided to partner with St. Croix to develop a solution that would set the standard for centralized service requests, resource assignment and dispatch in healthcare. This proved to be a worthwhile partnership, as eight months later, on time and on budget, Aurora was live — with St. Croix's Service Center Manager solution driving the innovation that was now optimizing both assets and resources.

Aurora has reengineered its capital equipment department; centralized service and dispatch; added 19 employees and contributed $1.5 million to the bottom line. And it was all funded by $3.5 million in contract savings.

For Aurora, Service Center Manager consolidates previously-dispersed calls and requests for service and resources. It also delivers a means to track important data at the point of origination, such as type of service, location, and urgency, to more efficiently and effectively dispatch the right resources. Immediate visibility into service requests is helping Aurora speed resolution, benefiting the patient care resources, the Clinical Engineering department, and ultimately the patient — all of which have a positive effect on hospital operating costs.

Combining Processes and Technology
Configured to receive requests electronically or via the phone, a clinician needing service can call into the centralized service center where their telephone number and location is instantly displayed. The caller can present a previously-assigned control number, or, if the request is new, be assigned a new number. The request is documented within the software based on level of urgency, and then a technician is dispatched via a pager, email or PDA, from which acceptance or replies can be transmitted.

If accepted, the technician then acknowledges arrival at the requesting site and again upon completion of service delivery. Given that Aurora is operating from a single database of records for all assets and equipment, the technician is able to use their PDA to update any associated work orders in the Asset Manager system and log any notes regarding the piece of equipment which they have serviced. Upon closing out the work order, the service request is automatically closed within the system.

Automated service requests are only one part of the story for Aurora. Managing to resolution is where the real resource optimization and efficiencies take hold. Service Center Manager offers flexibility, as technicians can be associated with assets in a variety of ways. Equipment is put into a modality classification system, and then primary and secondary resources are assigned to each classification, enabling auto escalation or reassignment when a primary resource might not be available to accept or respond. Calendar and scheduling functionality allows for logging and managing technician schedules and scheduling future assignments based on availability. Urgent calls are assigned to a technician, then acknowledged and responded to within fifteen minutes or less — a standard that was decided upon through a series of interviews conducted with key department stakeholders.

For emergency requests, Service Center Manager offers "quick-page" functionality to send out broadcast pages or emails for rapid response to critical needs. Response time has become an important and visible metric that the clinical engineering regional managers, analysts, and
supervisors measure and monitor. The results support increased efficiencies and service responsiveness and help compare performance to third-party service vendors.

For equipment-related service calls, Service Center Manager instructs the system to create a work order and facilitates the dispatch function via Aurora's existing communications infrastructure, which includes Blackberry devices and mobile phones. The entire process is seamless and takes but a few seconds to execute, eliminating the need for duplicate data entry.

At the completion of the service delivery, lifecycle information is automatically documented in the equipment record via integration with the Asset Manager application.

"Now we have a means to gather important data such as the number of service incidents, types of services, mean time between failure, length of service calls, and costs associated with service — both labor and parts," states Al Gresh, corporate manager of Clinical Engineering.

"Having a single record from which to operate for all equipment and associated service is invaluable to optimizing hospital assets and resources."

Measurable, Ongoing Results — and More
From a variety of perspectives, both financial and operational, Aurora Clinical Engineering has succeeded in getting to another level of efficiency. In the process, they've strengthened associated standards and service levels. Among the significant outcomes cited by managers and executives:

Delivering Capital Asset Lifecycle Management
Unfortunately, asset optimization remains an elusive goal for most healthcare enterprises. Fortunately for Aurora, this is not the case and they are now able to boast asset and resource optimization. Their enterprise approach to capital asset lifecycle management provides complete visibility into the inventory, location, history, utilization, life-to-date costs, predictive and preventive maintenance schedules, performance, safety, and remaining useful life.

Executives are armed with the strategic data and information needed to optimize the health system's asset base — from asset management to capital planning. This kind of transparency is what has lead Aurora Health Care to achieve efficiencies, cost savings, operational improvements, and a safe and high-quality environment of care needed to sustain their growing network.

Patrick Trim is currently the corporate director of Capital Equipment Services for Aurora Health Care, a not-for-profit Wisconsin health care system. His current responsibilities include all aspects of the capital supply chain, including:

Patrick has been in the healthcare supply chain for the past 27 years. He holds a BBA in Business Administration from Northwood University, in Midland Michigan, where he graduated with cum laude honors. He has achieved lifetime certification from the Institute for Supply Management (ISM) with a designation of Certified Purchasing Manager (CPM).

Patrick specializes in process improvement and system integration.

Automated service requests are only one part of the story for Aurora. Managing to resolution is where the real resource optimization and efficiencies take hold.

Copyright © 2006 St. Croix Systems Corporation
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Hennepen County Medical

When Hennepin County Medical Center got a clearer picture of the equipment usage in its system, it was able to optimize capital spending, boost operational efficiency and increase charge-back revenue. The Minneapolis hospital took that high-resolution picture—thanks to a software module from St. Croix Systems that tracks the utilization and location of mobile assets. St. Croix Systems developed its Asset Logistics and Utilization application in partnership with Hennepin County Medical Center.

That innovative application allows the hospital to boost patient revenue and control costs. Moreover, a clearer picture of its assets allowed the hospital to make smarter capital equipment purchases as well as reduce its amount of rental equipment.

A Provider in Transition
Hennepin County Medical Center (HCMC) is a premier academic medical center and public hospital located in Minneapolis, Minnesota. Named among America's Best Hospitals by U.S. News & World Report for seven years running, HCMC includes a 420-bed acute care hospital, three primary care clinics, and Minnesota's third-largest non-profit medical research organization.

Serving as the third-largest not-for-profit medical research organization, HCMC records approximately 7.30 percent of the total discharges in the Twin Cities of Minneapolis and St. Paul. Its Emergency Department is the largest in the state with an annual volume of more than 98,000 patients.

Like many other healthcare providers across the country, HCMC's operating costs are growing more rapidly than its revenues. As a result of that financial squeeze, HCMC struggles to keep pace with the capital investment required to sustain high levels of quality care. In order to respond to this challenging business environment, HCMC has undertaken a transition to a more market-responsive operating model with defined priorities for creating new revenue streams and instituting rigorous cost management. In fact, HCMC has set a target of demonstrating at least $4 million in annual sustainable savings within three years.

A Sophisticated Approach to Asset Management
Because HCMC has a history of innovation in asset management and capital sourcing, the hospital was an ideal partner for St. Croix Systems. HCMC was previously using a home-grown mainframe solution to record asset utilization and location. Phillip Gill, bioelectronics supervisor, recognized that a server-based application would allow the organization to more fully capture the potential of automating the logistics and associated utilization of equipment. Such a solution integrated with their equipment work order system would mean even further automation, a streamlining of manual intensive tasks and access to accurate, relevant and real-time data for reporting and decision making.

HCMC set out to find a software company with whom it could partner to develop this solution. Having implemented and utilized St. Croix Systems' Asset Manager solution since 1996, HCMC had an appreciation for the company's technology and experience in healthcare. Because of that prior positive relationship, HCMC approached St. Croix Systems to be its partner in developing a solution.

HCMC and St. Croix Systems began their work together in March 2004 and had a beta system up and running in November of that year. HCMC went completely live with the Asset Logistics and Utilization application in May 2005.

Since then, HCMC has seen hard financial gains on both the revenue and cost side: