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adopting data standards. This group does not have a labeler code, they don’t have any bar codes on their products, or they utilize a proprietary bar code that is impossible for healthcare providers to decode. Healthcare providers have been asking manufacturers to implement data standards for almost three decades. We need to serve our customers and use data standards to help them improve patient care and improve our supply chain.


• “Award a letter grade of a ‘B,’ ‘C’ or ‘D’ for those manufacturers who have started the data standards process and are now heavily investing in UDI. Some will ‘check the box’ and do the minimum necessary, while others will emerge to help add value for their customers and the overall healthcare supply chain.


• “I would reserve an ‘A’ grade for those manufacturers that didn’t wait for a regu- lation to begin serving their customers. They implemented standards on a volun- tary basis and are now refining labels and processes to become UDI compliant. These manufacturers are implementing UDI, and data standards in general, using a customer-centric approach that improves the entire supply chain (EDI, business transactions, easy-to-scan bar codes, clean master data, SSCC, GLNs, etc.). Black gave “the small minority of software companies that have already enabled use of data standards” an “A” grade. “These leading software companies have been cus- tomer centric from the start,” he said. “They have invested their time helping interpret the requirements and their resources by modifying their software. Since software is a key enabler to using data standards, the software companies that aren’t modifying their products for data standards should get failing grades for ignoring their customers’ requests. Healthcare providers, suppliers and GPOs can readily name which software companies are supporting them.” GPOs gained a complimentary and contextual deferment from Black as they occupy a different role. “Many GPOs have created data standards requirement for their suppliers in their contracts and are taking steps to support their members to adopt standards,” he said. “While the GPOs are certainly part of the process, since they don’t take possession of the product or transact, I wouldn’t expect that they could truly drive the process.” He applied similar justification to distributor deferment and added that providers should be the ones who evaluate both. Deborah Templeton, R.Ph., MHA, Chief,


Care Support Services, Geisinger Health System, described a grading system but of-


fered a frank and thinly veiled assessment of market progress to date. Templeton said “A” grades should ap-


ply to those who have fully implemented stan- dards with “no breach in physical or data flows from manufacturer to patient or documented disposal.” Those who deserved “B” grades may be working with GDSN on the front end, have their own GLNs with a secure physical chain and are working on integrat- ing billing, EHR and recall processes. “C” grades can be applied to those organizations transmitting GLNs and GTINs electroni- cally, and “D” grades to those working with GLNs only. Those who say, “GS-what?” get an “F,” she retorted. Scale of implementation and percentage of participation also are key factors, according to Templeton. She minces no words and of- fers little wiggle room in terms of numbers. Naturally, 100 percent participation earns an “A,” greater than 80 percent a “B,” greater than 70 percent a “C,” and greater than 60 percent a “D.” Less than 60 percent should merit an “F” at this point. As a result, Templeton gives manufac-


Deborah Templeton


turers overall grades that vary from “B” through “D,” major distributors “C” to “D,” software companies “B” based on the assumption that they’ve built capabilities for providers and suppliers to achieve their own “B” grades, GPOs similar to distributors and finally providers the widest-ranging “B” through “F.”


Templeton is a founding member of the Healthcare Transformation Group, which was formed in 2010 to by five healthcare systems to share best practices and drive supply chain process improvement changes. Dennis Byer, principal, DSB Consult-


ing, which specializes in UDI education, implementation and project management services, and former Global Healthcare Standards Lead, Novation LLC, offered his own direct assessment. “With the publication of the FDA’s final


UDI rule, manufacturers are now required to meet the mandated implementation timeline, and there will not be any manu- facturers who ignore the regulation,” Byer said. “If a manufacturer has FDA Class 3 products with a deadline of September 2014 and hasn’t started, they are going to be late. Many manufacturers say that to get product and labeling changes into the pipeline it takes a couple of years. In


Dennis Byer 12 March 2014 • HEALTHCARE PURCHASING NEWS • www.hpnonline.com


the industry groups there were arguments about this first implementation date for Class 3 products, and most manufacturers wanted two years and not the one-year deadline that is in the final rule. “From both a historical perspective and a current perspective many manufactures are committed and moving forward with or without a regulation,” Byer continued. “However, some manufacturers will continue to use any means available to potentially delay or postpone their imple- mentation. The final UDI rule basically says to the manufacturers, ‘if you believe that your product should have an exception, talk to the FDA. If you have some circum- stance that will interfere with your ability to implement, talk to the FDA. If you have existing inventory that is labeled but does not meet the requirements of the UDI, there is a three-year grace period to use up that inventory.’ Some of the manufacturers will use of all of these options if they are not ready to meet the UDI requirements by the mandated timelines.” Distributors face similar challenges even


if they work with private-label products or have to repackage items, according to Byer. They still must affix a UDI to the label by the required deadline. “Most of the distributors are focused on implementing GS1 standards and the UDI,” he said. “However, there are concerns about the level of commitment, and most of the regional distributors aren’t even ‘in the game.’ At this point in the initiative, any organization that feels that the industry has not embraced GS1 and the UDI is not really committed to improving patient safety and lowering costs.” Byer expressed “great concern” about the software companies. “There are a handful of software providers who are totally ready to support GS1 and the UDI, but there many others who aren’t even ‘aware,’” he noted. “GS1 should take on the challenge to reach out to the software providers, to educate and help them move forward, but so far that has not happened. Even with the software providers who are ready, a hospital must upgrade to the correct version and perhaps spend millions to support the upgrade process. With all of the pressure hospitals face today regarding meaningful use and the implementation of the electronic health record many hospitals cannot afford to do both. The UDI regulation from the manu- facturer and distributor perspective will happen. Unfortunately, it won’t really mean much if the hospitals’ systems are unable to support it.” GPOs, on the other hand, may be too distracted by other business-related issues


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