Benefits of Including the UDI in Inventory Management Systems

  • 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

    The Purpose of this Quick Start Guide

    This Quick Start Guide identifies the benefits for health care providers from including the full UDI (UDI-DI +UDI-PI) in various inventory management systems.

    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) that 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.

    Inventory Management Systems and Practices: There are a variety of inventory management systems designed to meet different needs of health care providers, from warehouse management to point of use capture in procedural areas. The most common uses of UDI in inventory management depend on the system and include:

    • Stand Alone systems that periodically scan products and use the UDI and data from GUDID to manage expiry and create inventory lists.
    • ERP inventory management modules that provide the option to track lot and serial numbers for selected products. Many also provide the option to capture and store the full UDI (UDI-DI +UDI-PI) and make it available upon query.
    • Third party perpetual inventory management systems that capture, integrate and share the UDI with ERP and EHR systems.

    Determining which system or combination of systems to use depends on the organization’s goals and where the systems are deployed; evaluation of such systems should include the potential to maximize the benefits of UDI in relation to the associated costs.

    Benefits of Including the UDI in Inventory Management Systems

    • Capturing the UDI-DI at the point of receipt provides significant value by expanding analytics capabilities and calculating lead-times and fill rates. The benefits are exponentially increased when the full UDI (UDI-DI + UDI-PI) is captured by:
      1. Allowing confirmation of the expiration date to ensure it is consistent with contract terms and facilitates the return of short-dated products to the manufacturer before they are stocked.
      2. Enabling a proactive system alert that a product had been recalled.
      3. Streamlining the recall process by validating whether products with specific lot numbers or other PI information were purchased.
      4. Identifying products that need to be added to systems to prevent a point of use scanning failure.
      5. Serving as a first step in chain of custody tracking.
    • Capturing the full UDI at the stocking location:
      1. Enables a proactive system alert that a product had been recalled.
      2. Streamlines the recall process and reduces the labor required to locate and remove recalled products.
      3. Facilitates rotating short-dated products to high use areas to prevent loss of inventory due to expiration.
      4. Provides insights that allow high use products to be placed closest to point of use and inventory levels adjusted to prevent stockouts or overstocking.
      5. Scanning consigned products enables providers to proactively share information on short-dated products with manufacturers, allowing them to replace or rotate products.
    • Capturing the full UDI at the point of use:
      1. Provides alerts to prevent recalled or expired products from being used.
      2. Facilitates identification of patients who received an implant or other medical device that was subsequently recalled.
      3. Improves the documentation accuracy by automatically embedding the correct product information into the patient’s record and improves charge capture rates.
      4. Using the UDI-DI to link to the data in GUDID ensures products are classified correctly (implant versus supply) and can improve charge capture accuracy.
      5. Reduces workload for patient care staff.
      6. Facilitates accurate documentation of product usage and waste in order to measure and reduce product leakage – the difference between calculated inventory levels (product purchased minus products used or wasted) and on-hand inventory.
      7. Allows providers to share detailed product consumption data with manufacturers.
      8. Supports automating the bill-only process.
    • Capturing the full UDI at any point in the process assists in the identification of potential counterfeit products by:
      1. Validating that the UDI-DI exists in the GUDID
      2. Determining if there are duplicate serial numbers.

    For more information on the full array of benefits UDI usage enables See Quick Start Guide on Benefits of UDI.

    Getting Started

    Conduct an analysis of current inventory management practices. Ask questions such as:

    • What system(s), if any, are currently being used? What capabilities does the existing system have for capturing, storing and/or sharing the UDI (e.g., only the UDI-DI or the full UDI)
    • Are there plans to upgrade or replace existing ERP or EHR systems that would allow for the incorporation of UDI into inventory management systems?
    • How is high dollar inventory in procedural areas managed?
    • Are proactive processes in place to prevent the expiration of products?
    • Are there systems or processes in place to prevent the use of expired or recalled products?
    • What is your inventory leakage rate?
    • What is your charge capture rate?

    Establish inventory management goals for specific areas of use, (e.g. procedural areas), and function, (e.g., managing stock levels, tracing utilization, etc.), and conduct a gap analysis.

    • Can goals be achieved by incorporating the UDI into existing systems and processes in order to maximize their effectiveness?
    • If system upgrades or replacements are planned, how can those be leveraged to improve inventory management processes?
    • If new technology is required, what would be the selection process? How will you evaluate the ability to utilize UDIs?
    • Is there an area where a pilot project could be established to test the impact of incorporating the UDI into inventory management and measure the results?
    • Do we have the people and processes in place to manage the incorporation of UDI into the inventory management process?

    Who to Involve