Patient Care Equipment Rental and Tracking Team

Team members:
Rick Borchard Team Leader, Bioengineering
Marilyn Boyd, Nursing
Greg Bredlau, Bioengineering
Linda Chase, Nursing
Richard Dorzwiler, Central Sterilizing
Linda Fink, Nursing
Joelle Jensen, Nursing
Mike Murphy, Central Sterilizing
Terri Stoner Facilitator, Value Analysis Program

Liaison Members:
Kathy Leaven, Material Services
Geofferoi Guiton, Administration

Value Analysis Team charge:
The Team charge was received from John Staley, Chair, Subcommittee for Coordinating of the Value Analysis Program. The impetus for the Team Charge was an H1 cost savings proposal submitted by Joelle Jensen and Linda Fink, Nursing Clinical Directors.

Team charge:

• Define the scope of patient equipment rental, focusing on adult IV pump rental units.
• Provide for a reduction of IV pump equipment rental costs through coordinated rental/purchase analysis. Investigate direct acquisition or the Baxter program for free IV pumps with the purchasing of tubing.
• Evaluate and maximize utilization of equipment on hand. Investigate methods for tracking equipment and analyze human resources to maintain the system.
• Provide a management process to track and relocate equipment to areas as needed.

(The first two objectives have been met. The objectives related to tracking have only been partially met. Increasing the number of infusion pumps in the hospital greatly reduces the need for frequent redistribution.)

Team recommendation:
At the end of June 1998, a multi-departmental committee recommended the purchase of 278 previously owned free-flow protected 6201 and 6301 Baxter infusion pumps for use on adult patients. The team has also recommended a standardized IV administration set for adult surgical patients.

The decision was supported by the following factors:

1. Cost comparisons supported infusion pump purchase rather than continued rental.
2. Investigated direct acquisition or the Baxter program for free pumps with the purchasing of tubing and discovered it was not cost effective for UI Hospitals and Clinics.
3. We have standardized our adult IV pump inventories to the same technology.
4. Upon submission of a competitive bid, we received favorable pricing for the purchase of previously owned pumps vs. new pumps. Previously owned pumps were selected for purchase rather than new pumps.
5. The purchased pumps have free-flow protection. The Pharmacy and Therapeutics Parenteral Infusion Device Subcommittee recommended phasing out non free-flow protected infusion pumps and purchasing only free flow protection pumps.
6. The Baxter infusion pumps were selected:
   1. To standardize with Baxter pumps currently in service for adult patients population.
   2. For low maintenance cost and durability.
   3. To provide the potential to standardize tubing.
   4. Previous clinical experiences had been favorable.
7. Criteria for determination of purchase needs.
   1. Replace old technology.
   2. Critical shortages of pumps in many clinical areas.
   3. Clinical applications requiring use of large volume infusion pumps have increased for adult patients.
   4. Allocation and standardizing anesthesia to Baxter pumps required additional pumps to provide consistency from OR to adult units.

Discussion of significant issues
The savings realized over a five-year period will be:

• $143,182 of cost savings over rental.
• $362,533 of cost avoidance.
• $50,000 for tubing standardization.
• Purchased 278 Baxter previously owned infusion pumps at the cost of $456,230. The estimated rental cost this year was $96,000. By eliminating rental cost ($96,000 annually) pumps will be paid for in 4.8 years.

The following information was used in the calculations:

1. Empirical analysis of data from our rental company, MEDIQprn, rental charges, and review of UI Hospitals and Clinics financial accounts indicated annual infusion pump rental fees were $95,304.
2. A five-year pay back window was used in estimating savings
3. We estimated a 5 percent rate of return on investment.
4. Our capital purchase was $456,230.
5. Future rental pump usage of 168 per day is estimated, our current usage is 110 pumps per day. However rental pumps do not have free-flow protection.
6. $100/yr per pump for Bioengineering pump maintenance. (The cost of maintenance is included in the rental pump charge.)

Additional non-quantifiable savings at the present time:

1. Standardization of Anesthesia pumps to Baxter for all adult patients.
2. Elimination of some tubing sets in stock (e.g. Omni-Flowset and adult Gemini sets).
3. Risk reduction of "free-flow" incidents involving potential patient injury and subsequent hospital liability.
4. Nursing time to change IV tubing once the patient is received from another unit.
5. Staff time spent looking for available pumps and wait time before the rental arrives.

Free flow protection issue:
Based on the recommendation of the Pharmacy and Therapeutic Subcommittee only free flow protected pumps will be purchased.

Once the decision was made to purchase additional pumps, this was the process:
A request for quotation was prepared that outlined our plan to purchase used pumps if the price difference between used and new was significant.

• Salvage Master was awarded the bid for used pumps on the basis of best price and warranty. The pumps that have arrived to date appear to be in excellent condition.
• Linda Chase coordinated an education plan. The plan addressed operator training/"freeflow" issues along with a recommended adult administration set up diagram by Marilyn Boyd.
• Joelle Jensen, Linda Fink, and Greg Bredlau designed a rollout plan for distribution of pumps addressing the highest patient population priorities first. Retrieval of rental pumps and reassignment of UI Hospitals and Clinics pumps will be done after inventory is in place.
• Nursing will develop a pool of IV pumps to be used for peak demand times, to avoid further pump rentals.
• New Master File Keys will be developed to capture rental information by major category. Currently all rentals, whether, beds, IV pumps or office equipment fall into one key, which makes evaluation of expenses difficult.

Future issues:

• A fiscal audit of this decision including a review of tracking/pump usage.
• Development of a Capital Budget Replacement plan to replace all IV infusion pumps within the next two to three years. All of the Baxter infusion pumps (previously owned and recently purchased previously owned) will have reached or exceeded maximum depreciated value.