S5: SC5 UDI in Contract File

  • F1 Use Cases for UDI
  • F2 Uses of UDI Data
  • F3 IT Integration
  • F4 Selecting Scanners
  • F5 Regulatory Guide/Glossary

  • C1 Benefits of Scanning at POC
  • C2 Which Barcode to Scan
  • C3 Handling Scan Failures

  • SC1 Adding UDI to ERP
  • SC2 Using UDI in EDI
  • SC3 Managing UDI-DI Changes
  • SC4 Using UDI in Inventory Management
  • SC5 Using UDI in Contract Management

    • Title:

    Including the UDI-DI in the Contract/Price File

    Description:

    This guide outlines the benefits and challenges of including the UDI-DI in the contract/price file. Today this is not common practice, but it is believed to be key to improving patient safety, optimizing efficiency and maximizing the use of the UDI going forward. Additionally, the guide outlines the steps each stakeholder group can currently 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.

    Benefits:

    • The contract/price file is the base document healthcare providers use to set up their internal systems. If the UDI-DI for the various units of measure were included in this file it would streamline the data integration between systems, including but not limited to, ERP, EHR, billing, inventory management, Point of Use (POA) systems and data registries.
    • Not all items approved by health care providers for purchase are contained in the item master. Having the UDI-DI included in the contract/price file would facilitate 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 the manufacturers internal reference catalog number. This would be accomplished within a single document.
    • 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.
    • The secondary benefit for both manufacturers and providers is the labor reduction and cost savings achieved from the reduction in errors and manual interventions. Price rounding errors would be reduced and the three-way match process improved. It would improve data analytics and business process comparisons in the event of a merger. Additionally, it would support increased automation such as scanning package barcodes to reorder products.
    • Utilization of the UDI-DI across all parties would reduce ambiguity tied to internal or proprietary catalog numbers, therefore improving rebate reconciliation, distribution charge backs and sales tracing.

    Challenges:

    • Manufacturers’ concern that associating price with the UDI-DI could compromise price confidentiality.
    • The requirement could lengthen contracting cycle time if manufacturers are unable or unwilling to provide the data.
    • GPOs currently do not require the inclusion of the UDI-DI in the contract/price file.
    • The potential need to customize IT system support. Some manufacturers’ systems may not contain the UDI-DI and product pricing in the same system. Some older health care provider ERP systems may not have a field to accommodate the UDI-DI in the contract/price file.
    • The potential impact on data maintenance. Currently many manufacturers struggle to keep their UDI-DI data current in the GUDID and accurately associated with their internal reference/catalog numbers. Likewise, providers struggle with reference/catalog and UDI-DI changes. Adding an additional element to the contract/price file will increase the time spent on data maintenance. It’s unclear how significant that increase would be, but it would require all parties to review and potentially strengthen their data management processes.

    Actions:

    Health Care Providers and Manufacturers:

    Health Care Providers and Manufacturers independently:

    • Measure current error rates and the underlying causes of those errors. Quantify the labor dollars and any other costs associated with fixing those errors.
    • Measure the current rate of UDI-DI changes. Evaluate what incremental cost would be associated with managing changes in the price/contract 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 price confidentiality concerns and current price benchmarking practices. Consider whether associating price with the UDI-DI might improve the process by better aligning what is considered comparable products. Discuss whether additional security measures would be required.
    • Set up a pilot with one partner and one contract to test the process.

    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 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 contract to support scanning, recall management, and traceability at the point of use

      Resources:

      Back to Introduction

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