Sisters of Mercy - Hospital innovators 2007

Location: St. Louis, MO Website: www.mercy.net What they're doing: Supply chain management innovations may not be sexy, but they're critically important. After all, at least 25 percent of hospital expenses are supply-related, so process improvements can have a significant financial and operational impact. At Sisters of Mercy, a Midwestern health system with 18 acute care hospitals and 4,000 affiliated physicians, managers have taken on medication supply management to the next level, saving millions of dollars and slashing patient errors in the process. Mercy's Resource Optimization & Innovation (ROi) division has developed a system-wide initiative that has redesigned the med administration process cutting medication errors and streamline drug dispensing. Under the program, Mercy Meds, the hospital has established an in-house purchasing group that contracts directly with drug makers; created a central drug distribution center, whose large volume allows the system to get bulk purchasing discounts; improved med delivery times, filling 99 percent of orders within the first 24 hours; and began transporting drugs with Mercy-owned vehicles, saving on outsourced transportation expenses. Along the way, the hospital has upgraded its inpatient medication tracking efforts, adding automated drug-dispensing med cabinets, barcoded patient wrist badges and a computer system prompting nurses to check for medication issues. The results have been dramatic. Mercy Meds is now generating $16 million in annual savings across the health system, including a reduction in drug errors and lengths of stay. In short, it seems like the time and expense involved in transforming Mercy's med supply chain has been well worth it. Other hospitals and health systems may well want to learn more about how Mercy made it happen.