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Logistics Quarterly Magazine - Volume 16, Issue 2, 2010GS1

Global Standards Proposed for Canada’s Healthcare Supply Chain

by Alicia Duval

The Canadian Healthcare Supply Chain Standards Survey is a national poll conducted for GS1 Canada by the Innovative Research Group Inc. (INNOVATIVE) as part of the Canadian Healthcare Supply Chain Standards Project. The survey polled 294 Canadian healthcare sector stakeholders representing a blend of healthcare institutions, Shared Service Organizations (SSOs) and product suppliers. Results of the survey were released in July by standards body GS1 Canada.

Why was the Canadian Healthcare Supply Chain Standards Survey conducted?
The survey was conducted to gauge the Canadian healthcare sector’s readiness to adopt global GS1 supply chain standards in order to modernize and advance Canada’s healthcare supply chain.
The results of the survey illustrate that a majority of Canadian healthcare decision-makers in supply chain management support moving to a pan-Canadian approach to bar-coding healthcare products as well as sharing administrative data electronically, based on the GS1 system of standards. According to the survey, the sector believes that such a unified approach will improve patient safety and generate significant system-wide cost savings.

What are the key findings of the Canadian Healthcare Supply Chain Standards Survey?

  • Eighty-nine percent of healthcare institutions and 75 percent of healthcare suppliers believe that harmonizing healthcare product identification practices and inventory management processes using globally-recognized GS1 standards will generate substantial benefits for the Canadian healthcare system.
  • Eighty percent of healthcare institutions and 53 percent of product suppliers agree that standardized product codes will increase patient safety.
  • Fifty-two percent of healthcare institutions and 72 percent of product suppliers either currently use or plan to use bar codes in the next two years to capture, store, retrieve and transmit information about medical-surgical products.
  • Forty-eight percent of healthcare providers and 40 percent of product suppliers have implemented or are currently implementing a strategic initiative to increase interoperability with supply chain partners.

The leading standard for medical-surgical product identification in the Canadian healthcare sector is the GS1 Global Trade Item Number (commonly recognized as the bar code).

What are global supply chain standards?
A standard is the common language used between organizations. Global GS1 supply chain standards provide a common language that enables organizations throughout the world to exchange products, offer services, and communicate information about them quickly, consistently, efficiently and securely. In the healthcare sector, standards drive economic and patient safety benefits by enabling automatic product identification (matching the right drug with the right patient, for example), product and asset traceability, and electronic processes for sourcing, ordering, receiving and internal management of products.
Perhaps the best-known GS1 standard is the bar code — often seen on everyday grocery and retail items. Over one million organizations in more than 140 countries worldwide use GS1 standards to manage their supply chains more efficiently.

What is the GS1 System of Standards?
The GS1 System of Standards includes:

  • GS1 Identification Keys: globally unique numbering schemas for products, locations, relationships and assets
  • GS1 Bar Codes: several types of bar codes, including linear and two-dimensional, for use depending on the application
  • GS1 EPCglobal: technology and numbering standards for use of radio frequency identification
  • GS1 Data Synchronization: standards for accurate product data sharing between supply chain partners
  • GS1 eCom: supporting electronic document interchange

What value do global supply chain standards have?
Global supply chain standards enable products and information to move accurately, efficiently and quickly between organizations, across jurisdictions and borders, enabling traceability, administrative efficiency, and system-wide cost savings in various industries, including healthcare. The use of global standards in healthcare will ultimately support healthcare providers in their efforts to ensure patient safety by ensuring the right product reaches the right patient at the right time and in the right dosage.

What do the findings of the Canadian Healthcare Supply Chain Standards Survey mean for Canada’s healthcare sector?
Survey findings indicate that Canada’s healthcare sector is ready for a national, standardized approach to product identification practices and supply chain and logistics management processes using globally recognized GS1 standards.

How will this initiative impact the lives of ordinary Canadians?
The sustainability of Canada’s healthcare system is a concern for many Canadians. Increasingly, the cost of healthcare in Canada is outpacing government funding capacity. Innovation and sustainable solutions are imperative to improving productivity, and reducing unnecessary waste in Canada’s healthcare system.
As well, use of global standards such as the GS1 bar code have been proven to reduce medication errors and improve patient care, with early adopters around the world reducing medical errors in staggering ranges of 60 to 85 percent1 due to:

  • improved matching of product data to patient data (with the patient's consent);
  • ensuring a patient receives the right dosage of the right medication at the right time; and
  • ensuring accurate product data is contained in hospital item master files, thereby reducing data errors that can be transferred into patient and inventory records.

Various sectors, including grocery, have realized a host of key benefits through the use of global GS1 standards. The survey demonstrates that there is timing and opportunity now for the healthcare sector to engage.

Why should hospitals implement global standards in their supply chains?
A 2010 Ontario Hospital Association study estimated potential savings of $54 million annually — plus a one-time savings of $1.8 million to $9 million — through continued supply chain improvements in hospitals.1
Healthcare costs are increasing, and innovative solutions are required to achieve a more sustainable system. Standards such as the bar code are proven to drive measurable cost savings and efficiency gains, demonstrated by early adopter sectors such as grocery and pharmacy. The Canadian healthcare system is ready for GS1 standards.
1. Ontario Hospital Association, “Ideas and Opportunities for Bending the Health Care Cost Curve: Advice for the Government of Ontario,” April, 2010.

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