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Issues & Legislative Committee Report

June 2004

JCAHO Update

MidMichigan Health facilities recently had 2 facilities undergo the “new” survey process. The tracer methodology appears to be a strong concept by following a patient through the stay. The focus from the administrator was heavily weighted to patient safety as expected, much in the area of fire safety. Also evident was a good deal of interest in succession planning and management development both at the Board and Administrative levels.

A key role for materials managers is to maintain an environment conducive to providing safe patient care. We do this by: Eliminating clutter in storage areas; Keeping exits clearly unobstructed; Continually checking for outdates and effective stock rotation; Keeping storage and receiving areas clean and well organized; Educating materials staff on safety, product integrity, and infection control issues; Standardize to reduce variability of products and processes. Future surveys will be unannounced so organizations need to continuously challenge themselves, identify weaknesses, and make improvements before the survey takes place.

JCAHO’s new process includes emphasis on the following:

Quality reports will be the link between the customer and the healthcare organization via the JCAHO survey process. 

Group Purchasing Organizations (GPOs)/Code of Conduct Principles

There is a prospect of another (third) U.S. Senate Judiciary Antitrust Subcommittee Hearing being held this month. However, with the Senate scheduled to recess on July 23rd, if there is a hearing, it probably will occur in September. While there is no clear idea as to what the hearing would focus on, it is speculated that there is concern that when the Subcommittee shifts their attention to other matters, the GPO industry will revert to its old ways. Therefore, there seems to be interest in finding some method to insure that the changes achieved over the last two years are long-lasting. In addition, HIGPA is moving ahead with compliance programs for its Code of Conduct; including an education program for GPO Compliance Officers (probably in the fall).

Reprocessing

Food and Drug Administration (FDA): Single-Use Devices

Thriving third party reprocessing sector sours new growth opportunities. Despite attempts by manufacturers to stamp out third party reprocessing through legislation and regulatory oversight the industry is growing for three reasons:

In 2002, figures from the FDA indicate that the practice is widespread. Nearly half of the hospitals with 250 beds or greater, reprocess at least some single use device. The figure is believed to be much higher now.

AMDR Reports 16 of 17 Hospitals Are Leading Honor Roll Facilities

The Association of Medical Device Reprocessors (AMDR) reports that 16 of 17 hospitals identified as “leading honor roll facilities” (US News and World Report) rely on AMDR member reprocessing. AMDR serves 69% of the nation’s top 203 medical centers (US News and World Report).

According to the article, it is believed that the key is the FDA regulatory oversight, which in some cases is more stringent than that over the OEM. The value of the
510(k) is understood in the management suite. This trend represents a shift away from the hospitals’ more cautious approach, which generally started with compression sleeves and other non-invasive devices before gradually moving
into other segments.

In one year, the Alliance claims to have seen the average number of reprocessing services, such as OR and laparoscopic devices and electrophysiology catheters, jump from 1.2 to 3.4. Potential savings include:

The Association of Medical Device Reprocessors (AMDR) is comprised of the Alliance Medical Corp, SterilMed Inc., and Vanguard Medical Concepts.

Source: Infection Connection, Healthcare Purchasing News, June 2004.

Disaster Preparedness

The AHA endorsed the July 2004 "OSHA Guidance for Hospital-based First Receivers of Victims from Mass Casualties Incidents Involving the Release of Hazardous Substances." The guidance outlines the difference between risk and exposures to chemical, biological, or radiological materials by First Receivers opposed to first responders.

Healthcare workers risk occupational exposures to chemical, biological, or radiological materials when a hospital receives contaminated patients, particularly during mass casualty incidents. These hospital employees are termed first receivers and work at a site remote from the location where the hazardous substance release occurred. This means that their exposures are limited to the substances transported to the hospital on victims' skin, hair, clothing, or personal effects. The location and limited source of contaminant distinguishes first receivers from other first responders (e.g., firefighters, law enforcement, and ambulance service personnel), who typically respond to the incident site (i.e., the Release Zone).

This new guidance recognizes that first receivers have somewhat different training and personal protective equipment (PPE) needs than workers in the hazardous substance Release Zone. The complete standard can be found at http://www.osha.gov/dts/osta/bestpractices/html/hospital_firstreceivers.html.

eCommerce and Bar Coding

Recognizing that it has been less than three months since the effective date of the FDA ruling that human drug products and biological products, (and blood), will be required to contain a machine-readable linear bar code, the FDA is giving the industry a little time to make their best good faith efforts to get their respective businesses in compliance. The FDA is seldom receiving inquiries in the matter. (The only ones coming in during the first month were from a few manufacturers and repackagers.)

In the meantime, most manufacturers appear to be pressing forward. Companies like Pfizer and Abbott reportedly completed the process some time back. (Pfizer is also including lot numbers and expiration dates in their program.) Cardinal reportedly created their own new barcodes in compliance with the linear standard. The FDA has been working on compliance criteria since before the finalization of the rule. Although no formalized assignment has been made on precisely “who” will bear ultimate responsibility for audits and enforcement, it is likely to include multiple bodies.

Those more likely include FDA field offices personnel, operating in major metropolitan areas of every State. Additionally, compliance auditing may be a mandate for officials in certain State agencies that operate programs heavily dependent on Federal funding. As to where and when compliance audits will start, no timetable has been established. The first audits will probably come about as a result of complaints received. There could be official complaints lodged by healthcare providers or payors. Very likely, the complaints will be anonymous, from competitor(s) of noncompliant manufacturers or repackagers. When either occurs, the FDA will spring into enforcement mode.

Lately, there has been little heard from the provider side. As reported earlier, the FDA has no jurisdiction over healthcare providers, just the products. Recognizing that ultimate success of the program is the goal, (the reduction of medication errors), it is conceivable that the Department of Health and Human Services’ Centers for Medicare and Medicaid Services (CMS), the Joint Commission for the Accreditation of Healthcare Organizations (JCAHO), and various State agencies (dependent on Federal funding), will be enlisted to encourage (or influence) hospitals and healthcare providers to expeditiously secure the capability of scanning barcodes on the affected products before dispensing or administering to patients. It is possible that risk insurers may play a role as well in expediting progress.

Institutions that move early to implementation of bar code technology, (including patient ID and medical professional ID badge scanning capabilities), may wish to use this as a basis for negotiating lower premiums for professional liability and malpractice insurance. Insurers may use the lack of capability as a basis for greater risk determination and increased premiums. Reportedly, RFID is still influencing progress. It is anticipated that some companies may be hedging on full implementation of barcode placement waiting to see if there is a change before they get caught. In the current matter of “counterfeit drugs” possibly coming in from outside the United States, a case can easily be made for RFID technology as a means of product suspect elimination.

In the “final ruling”, a provision was inserted that every two years from the effective date, current technology will be evaluated, and a determination made whether to change the standard. In the meantime, however, that provision cannot be used as justification to delay implementation of barcoding using the existing standard. What’s next? When asked when to expect the ruling to spread to other products, such as implantables, dressings, ointments, catheters, syringes, or other direct patient care products (typically sterile products with integrity expiration dates, etc.), it was stated that it will take some time and may be more complicated. Those products may already be covered somewhat under existing “medical devices” regulations and could require amending and stiffening those regulations instead of invoking new ones.

Radio Frequency Identification (RFID)

Privacy Standards

A bill requiring privacy standards for RFID technology was defeated in the California state assembly. The opponents prevailed arguing it was premature to regulate an industry that was just getting started. It should wait until the technology is a bit more mature so as to not stifle roll out. Senator Deborah Bowen who sponsored the bill disagrees and says the time to regulate is now so that the standards can be built into the technology. Several other states are considering RFID privacy legislation among them Massachusetts and Virginia.

RFID to Manage Evacuations

Axcess International is promoting an idea to use RFID tags to track individuals during emergency evacuations. They propose using an active tag rather than a passive one. Active tags have a power source and transmit their location to a receiver. A passive tag gets “tagged” as it passes an active reader. The idea would be that individuals would carry an active tag embossed on something like an ID card, which would pinpoint their location. This would prove very valuable to locate triage personnel, fire department, physicians, and other critical personnel during an emergency situation. It would require tags powerful enough to be read at some distance or a series of receivers in the assembly area. Tags are currently used to locate vehicles such as ambulances and fire engines.

RFID-enabled Phones

An RFID tag called a near field communications (NFC) would be embedded in a phone. When the tag transmits a short-range secure signal goes to a receiver. The article explains that you could hold your phone up to a movie poster, which has a receiver tag. The NFC would connect with the poster tag and you would be online to the movie theater and able to buy tickets for the show. This sort of automatic connection is called “peer-to-peer” communication. The lithium battery in the phone would be the power source for the NFC. Companies such as Nokia, Sony, and Philips are investing in such technology.