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Where is RFID's ROI in Health Care?
Finally, diversions where patients are redirected to other hospitals can be reduced since optimizing patient flow provides more capacity in the system, allowing patients to be treated on the spot. In this example, the business case is more complex and the return on investment can be harder to estimate. Patient-flow management is a complex topic requiring strong knowledge of current health-care processes and a holistic approach to implementation that factors in change management and continuous improvement, along with the technical aspects of implementation.
The business case for RFID-enabled medication administration relates to the well-known "five rights" of medication administration: right patient, right medication, right dose, right time and right route. Like bar codes, RFID can help ensure these five rights are upheld and, hence, contribute toward reduced medical error rates. While only 7 percent of erroneously administered doses, on average, lead to "adverse drug events"—causes harm to the patient—these kinds of preventable events can lead to increased patient stays averaging over two extra days and costing around $4,600 per event. Litigation from ADEs can be much more significant in terms of cost, and negative publicity is equally damaging. In this example, the business case is again harder to determine in terms of hard ROI numbers, but it is obviously an area of the most importance, since it directly relates to patient safety.
To execute on these three business cases, it is important to take a holistic approach and consider which initiatives are quick wins versus longer-term strategies. Tracking assets and improving patient flow can be implemented in parallel in order to leverage the same infrastructure—typically indoor positioning systems utilizing active RFID.
To measure success before a widespread rollout, providers can also target subsets of patients and assets. We have found that many providers are pursuing a phased approach from the emergency department to the operating room and beyond. This strategy helps focus deployments first where they have maximum benefit, and to expand later into other areas of value.
The business case for RFID-enabled medication administration, on the other hand, is more of a longer-term strategy because it requires more infrastructure to be in place, such as RFID-tagging at the item level, RFID-enabled patient wristbands for positive patient identification, and wireless devices and networks available to nursing staff throughout a facility. It also requires integration with existing clinical systems and software that supports RFID-enabled point of care.
These three application areas have strong business cases with the potential to improve patient safety and health-care service delivery significantly. While the return on investment is often readily apparent for quick wins such as mobile-asset tracking, the most strategic benefits appear to be found when RFID is applied to clinical transformation in terms of patient-flow management and medication administration. The return on investment is harder to quantify, yet the business benefits to patients and providers are immense.
Nicholas D. Evans is the global lead of emerging technology at BearingPoint. He is the author of Business Innovation and Disruptive Technology (Financial Times, Prentice Hall) and chairs the RFID Standards Task Group for the Information Technology Association of America (ITAA). He can be reached at nicholas.evans@bearingpoint.com.
The business case for RFID-enabled medication administration relates to the well-known "five rights" of medication administration: right patient, right medication, right dose, right time and right route. Like bar codes, RFID can help ensure these five rights are upheld and, hence, contribute toward reduced medical error rates. While only 7 percent of erroneously administered doses, on average, lead to "adverse drug events"—causes harm to the patient—these kinds of preventable events can lead to increased patient stays averaging over two extra days and costing around $4,600 per event. Litigation from ADEs can be much more significant in terms of cost, and negative publicity is equally damaging. In this example, the business case is again harder to determine in terms of hard ROI numbers, but it is obviously an area of the most importance, since it directly relates to patient safety.
To execute on these three business cases, it is important to take a holistic approach and consider which initiatives are quick wins versus longer-term strategies. Tracking assets and improving patient flow can be implemented in parallel in order to leverage the same infrastructure—typically indoor positioning systems utilizing active RFID.
To measure success before a widespread rollout, providers can also target subsets of patients and assets. We have found that many providers are pursuing a phased approach from the emergency department to the operating room and beyond. This strategy helps focus deployments first where they have maximum benefit, and to expand later into other areas of value.
The business case for RFID-enabled medication administration, on the other hand, is more of a longer-term strategy because it requires more infrastructure to be in place, such as RFID-tagging at the item level, RFID-enabled patient wristbands for positive patient identification, and wireless devices and networks available to nursing staff throughout a facility. It also requires integration with existing clinical systems and software that supports RFID-enabled point of care.
These three application areas have strong business cases with the potential to improve patient safety and health-care service delivery significantly. While the return on investment is often readily apparent for quick wins such as mobile-asset tracking, the most strategic benefits appear to be found when RFID is applied to clinical transformation in terms of patient-flow management and medication administration. The return on investment is harder to quantify, yet the business benefits to patients and providers are immense.
Nicholas D. Evans is the global lead of emerging technology at BearingPoint. He is the author of Business Innovation and Disruptive Technology (Financial Times, Prentice Hall) and chairs the RFID Standards Task Group for the Information Technology Association of America (ITAA). He can be reached at nicholas.evans@bearingpoint.com.
