Benefits of Including the UDI-DI in the Contract/Price File

  • What is UDI?
  • The Benefits of UDI

  • UDI in Transaction Sets
  • UDI in Inventory Management
  • UDI in Contract Management

  • Benefits of Scanning the UDI at Point of Care
  • Knowing Which Right Barcode to Scan for the UDI
  • Handling Scanning Failures

  • Adding the UDI to the Item Master
  • Maintaining Data Quality

  • What is GUDID?
  • Glossary and Regulatory Guidance

    • Back to Introduction

    Purpose of this Quick Start Guide

    • This guide outlines the benefits of including the UDI-DI in the contract/price file. This is not currently common practice, but it is considered key to improving patient safety, optimizing efficiency and maximizing the use of the UDI going forward.
    • The guide also outlines the steps each stakeholder group can take to create the foundation to make this common practice.

    Terminology

    See the Glossary Quick Start Guide for the definitions to any unfamiliar terms or acronyms.

    What is UDI?

    The UDI is an FDA mandated code intended to improve patient safety by unambiguously identifying medical devices (from low to high-risk products) sold in the U.S. through distribution and use. Beyond patient safety, the UDI delivers a myriad of benefits across clinical, financial and supply chain functions. Manufacturers must obtain UDIs from one of three authorized issuing agencies for all of their products (unless specifically exempt) and label those products with the UDI in both human and machine-readable formats. The UDI consists of two parts: a device identifier (DI), which designates the specific make or model and packaging quantity (unit of measure) of a device, and a production identifier (PI) that includes the information used by manufacturers to control production of the product, such as lot, batch or serial number, expiry date and date of manufacture. For medical devices including human cell, tissue, cellular or tissue-based products, the UDI-PI also includes a code that can associate the device with the donor. Manufacturers must also publish additional data about their products in the Global UDI Database (GUDID), most of which is publicly accessible through AccessGUDID.

    Under separate regulation from CMS and the ONC, health care providers are also required to use the UDI when documenting the use of implantable devices in electronic health records and in adverse event reports involving serious injury or death.

    For more information on the UDI, see the “What is UDI” Quick Start Guide.

    Benefits of Including the UDI-DI in the Contract/Price File

    • The contract/price file is the base document health care providers use to set up internal supply chain and financial systems. If the UDI-DIs for the various packaging levels (units of measure) were included in this file, it would streamline data synchronization between systems, including but not limited to ERP, EHR, billing, inventory management, point of use (POU) systems and data registries.
    • Not all items approved for purchase by health care providers are contained in the item master. Having the UDI-DI included in the contract/price file would facilitate use of the identifiers on contract special orders and reduce pricing and unit of measure errors.
    • Inclusion in the contract/price file eliminates the separate process manufacturers and providers must go through to associate the UDI-DI with manufacturer internal reference catalog numbers. This would be accomplished within a single document and serve as the source of truth for other systems.
    • Improving patient safety, in part by improving the recall process, is the primary benefit of the UDI. Currently there are systems in place using the UDI-DI to improve recall identification. Including it in the contract/price file facilitates provider adoption and expanded utilization to maximize value.
    • Price rounding errors would be reduced and the three-way match process improved.
    • Both manufacturers and providers can reduce the time spent and the associated labor costs incurred to manually address errors.
    • Utilization of the UDI-DI across trading partners would reduce ambiguity tied to internal or proprietary catalog numbers, thereby improving rebate reconciliation, distribution charge backs and sales tracing.
    • In the event of a merger between health care providers, having the UDI-DI in the contract/price file would facilitate price comparisons for contracted items across the merging organizations.

    For more information on the full array of benefits UDI usage enables see the Benefits of UDI quick start guide.

    Building the Business Case for Adding UDI-DI in contract/price files

    Below are steps the various stakeholders can take to build the business case:

    Health Care Providers and Manufacturers Independently

    • Measure current error rates (e.g., price discrepancies, unit of measure errors, etc.) and the underlying causes of those errors. Quantify the labor dollars and any other costs associated with fixing those errors.
    • Evaluate current data maintenance processes and quantify the labor dollars and any other costs associated with managing UDI-DI changes. Identify any incremental costs related to maintaining the UDI-DI in the contract/price file.
    • Meet with internal IT system owners and external company representatives to analyze existing system capabilities and determine what (if any) changes would be required to include the UDI-DI in the contract/price file and the associated costs.

    Health Care Providers and Manufacturers Collectively

    • Meet with key trading partners and discuss the implications of including the UDI-DI in the contract file. Share the data collected independently and discuss ways to reduce errors and costs.
    • Discuss whether including the UDI-DI in the contract/price file would impact price confidentiality or benchmarking practices. Determine if additional security measures would be required.
    • Set up a pilot with one partner and one contract to test the process before scaling more broadly.

    IT Solutions Providers

    • Review current products and determine which versions have the capability to accommodate the UDI-DI in the contract/price file. Identify any “work arounds” that would support this practice.
    • Talk with clients and business partners regarding planned software enhancements and how they would support including the UDI-DI in the contract/price file, as well as overall improvements to interoperability.

    GPOs

    • Review current systems and determine what changes and associated costs would be necessary to include the UDI-DI in the contract/price file. Share those findings with health care provider clients and manufacturers.
    • Identify process improvements and any other potential cost savings that would arise from this practice.
    • Establish a pilot project to test the process.

    Data Management Companies and Exchanges

    • Link UDI-DIs to contract, manufacturer, and ERP records across systems, enabling one-to-one and one-to-many mappings.
    • Embed UDI-DIs into contract data feeds to providers, GPOs, and ERPs.
    • Reconcile discrepancies between UDI-DI, catalog number, and price across contract files, item masters, and purchase data.
    • Equip providers with UDI-DI–enabled contracts to support scanning, recall management, and traceability at the point of use.