RFID Business Applications
Radio Frequency Identification for Sibley Memorial Hospital
May 1, 2006
Stephanie Willson
Cheryl Spencer
Michiko Enohata
Stanley Rosholt
Executive Summary
Sibley Memorial Hospital is a small suburban hospital located in Northwest Washington, DC. Although Sibley currently has a niche market that helps them do well, they are facing more competition in the health care sector that is getting fiercer everyday as other hospitals adopt new technologies to increase their efficiency. The number one trauma center in the DC area, Washington Hospital Center (WHC), has already started implementing new technologies that other hospitals are still looking into. One of the most exciting technologies that WHC has begun setting in place is RFID (Radio Frequency Identification). Sibley would do well to follow Washington Hospital’s lead and update their systems as soon as possible in order to be competitive as new forces join the health care sector.
Company & Market Overview
Since 1890, Sibley Memorial Hospital has been a non-profit and community-based hospital licensed by the U.S. Department of Health and Human Services to provide health services in the Washington metropolitan area. In addition to being a full service hospital with 328 beds, Sibley provides various specialties and is especially known for treatments for breast cancer, Alzheimer’s disease, and rehabilitation, and for its radiology services, and senior nursing services. The hospital also has a 24-hour level II emergency department.
Sibley’s organizational strategy, according to its mission statement, focuses on providing quality health service and facilities in order to promote wellness, to relieve suffering and to restore health in the community. Also, emphasis is given to providing the best health service as safely and humanely as possible.
The market value of health-related services in the U.S. healthcare industry was $1.7 trillion in 2003. The market is expected to double by 2013, primarily due to the increase in the aging population (Mergent Online). As trends in the industry, more hospitals are likely to introduce and update advanced technology in order to integrate information or keep track of medical procedures. Mentioning the relationship between RFID and medication, the U.S. Food and Drug Administration recommends the attachment of RFID tags to ensure that all drugs in the U.S. are the safest in the world from the point of manufacture to the point of dispensing (E-health Insider).
Competitive Forces Analysis
Competitors
Sibley Memorial Hospital’s main competitors include: the Washington Hospital Center, Georgetown University Hospital, Greater South East Community Hospital, Providence Hospital, Howard University Hospital and the George Washington University Hospital. The Washington Hospital Center has a competitive advantage due to its location in the heart of Washington D.C. and its high reputation in trauma and premium cardiology services, which make it appealing to residents throughout the city and surrounding regions (Urban Institute). Georgetown University Hospital shares with Sibley the more affluent population in the Northwest Washington, DC area and it also attracts patients from the Northern Virginia suburbs. The Greater South East Hospital has been serving the residents of the Anacostia area for nearly four decades while Providence serves the African-American residents of Northeast Washington, DC. Howard University Hospital also serves the African-American population of Washington, DC. and is also geared toward the affluent black population of Prince George’s County. (Howard University Hospital Website) Lastly, George Washington University Hospital’s central location, accessibility, and reputation make it the hospital of choice in its neighborhood and it also attracts patients from other areas of the city.
Threat of New Entrants
The threat of new entrants is low due to the high amounts of capital needed to establish a new hospital. In addition, each of the DC hospitals has a niche that they focus on. A new entrant would have a very difficult time creating a respectable reputation and client loyalty while competing with already recognized hospitals in the area. Moreover, the shortage of medical professionals makes the task of entering the market very difficult. Although the threat of new entrants is low, there are two possible threats. The first threat is the possibility of Sibley not maintaining its technical edge inviting other area hospitals to compete for Sibley’s target clients. The second, threat is that of large consortiums such as MedStar (a$2.7 billion dollar non-profit organization), which owns Washington Hospital Center and Georgetown University Hospital, buying smaller hospitals.
Bargaining Power of Suppliers
Sibley Hospital does not have much control over the suppliers that provide it with complex equipment and maintenance (i.e. imaging equipment). Moreover, it does not have an advantage over other hospitals for attracting specialized medical personnel (radiologist practice) due to their technical skills and licensing restrictions. On the other hand, Sibley Hospital has bargaining power with the numerous suppliers providing disposable products (i.e. gloves).
Bargaining Power of Buyers (Patients)
In order to reduce their costs, patients might bargain for higher quality and greater levels of service at lower prices. (Hokskisson/Hitt) Obviously, there is less bargaining for lower prices by patients when they require immediate, possibly life threatening, treatment. In the case of a Sibley Hospital patient, bargaining for lower prices is not an option since the hospital is ranked among the nation’s top five percent of hospitals in a report by WebMD. (SibleyWebsite) Moreover, prices are already preset due to agreements with insurance companies.
Threat of Substitute Products
The threat of substitutes for the services that Sibley Hospital provides is low. However, the revenues generated by Sibley’s emergency services is being threatened by the emerging Minute Clinics located in some Target and CVS stores in Baltimore and in Maryland’s D.C. suburbs. They offer a quick, convenient and inexpensive treatment to common illnesses like strep throat, allergies, bronchitis, and ear infection among others that are usually treated by hospital emergency personnel. (Minute Clinic Website)
Value Chain Analysis
Primary Activities: Operation
One of Sibley’s valuable aspects, as stated in their slogan “A Community of Caring”, is that Sibley becomes involved with people’s by focusing on better community health care, including maternity, geriatrics, pain management, and various kinds of surgeries. Also, another valuable cultural aspect is that of being innovative in striving for excellence, which makes it more attractive in terms of delivering effective performance in its services to patients.
In regard to its organizational structure, Sibley is divided into departments according to the types of service provided. However, an important factor is the integration of each unit into a management structure that makes the overall medical treatment system more efficient. Sibley emphasizes that their success is always dependent on the people who work there. Therefore, Operations, which is based on better patient care with quality medical professionals helps make Sibley invaluable.
Primary Activities: Service
Sibley’s service activities are focused in their excellence in breast health, quality of geriatric long-term care, and rehabilitative medicine as described below:
Sibley’s Center for Breast Health: Forty percent of treated diseases at Sibley Hospital involve breast cancer which makes the hospital a leader in the Washington metropolitan area in the field of diagnosis and treatment for women.
Sibley’s Long-term Care: In 2000, Sibley opened Grand Oaks, which offers residential facilities for older adults. The staff provides personalized 24-hour assistance in order to maximize residents’ dignity, privacy, choice and safety, which makes the Grand Oaks more attractive for its clients.
Sibley’s Rehabilitation Medicine: Sibley has a one of the Washington areas’ most complete and sophisticated outpatient rehabilitation services. A well equipped gym, therapeutic pool, hearing and speech center with patient-first care helps individuals retain an active and painless life.
Support Activities: Human Resource Management
Sibley Hospital creates value by offering highly qualified human resources based on its clear vision and criteria for employees. According to its website, employment philosophy describes that all employees are supposed to provide the following values: “personalized and compassionate service, excellence and continually improving quality, teamwork, job satisfaction, professionalism, wise use of resources to provide value, innovation, trust and respect, up-to-date technology, a clean, attractive, quiet, safe environment, and honesty, integrity, flexibility and unselfishness”.(Sibley Website)
To deliver these values, the hospital focuses on equal opportunity employment policy without regarding to race, religion, national origin, sex, or age. These aspects are not considered during employment procedures of hiring, placement, transfer, training, compensation and layoff. As an overall policy, the hospital management says that they hire the whole person, which means they respect the entire personality of individual workers.
SWOT (Strength, Weakness, Opportunities, and Threats) Analysis
A SWOT analysis will help one to better understand where Sibley Memorial Hospital is already strong within the medical industry and also where they should make their improvements.
Strengths
Sibley’s main strength is that it has a strong following of affluent Northwest Washington, DC residents. Most hospitals are not so fortunate as to deal with such a steady stream of patients who have either good health insurance and/or deep enough pockets themselves to afford the quality of better patient care that Sibley strives to deliver. Sibley also has a few niche markets that also help to keep the hospital viable and profitable in areas such as geriatrics and maternity. Geriatrics, or elder care, is the primary focus of patient care at Sibley, which reflects the demographics of its location in one of the wealthiest and older parts of the Washington, DC area. Also, Sibley is in the growing market of our nation’s aging population, the majority of which have high incomes that ensure a higher rate of payment. Additionally, since Sibley does not have as much ER traffic as a major trauma center, a patient is more likely to get the proper supplies which may be in shortage at a much busier hospital.
Weaknesses
Sibley has several weaknesses that may be difficult to overcome considering the large number of excellent hospitals in the DC area. Washington Hospital Center is DC’s #1 Trauma Center and a small hospital such as Sibley may lose its opportunity to serve the local community if its patients believe that they will receive better ER patient care at a major trauma center. Depending upon the number of disaster victims or injured patients requiring immediate ER treatment whereby triage is necessary, a patient may or may not receive better care from going to a major trauma center for help. If an injury is something minor, such as a cut off finger or an infection, a patient could spend several hours at an overly busy hospital waiting to receive care since these conditions are not classified as causing imminent death, which could happen with an asthma or heart attack. A little known secret in the ER field is that although one will receive the same priority for minor emergencies at a smaller hospital – one can spend less than 1/10th the time that would have be spent at a major trauma center to receive treatment. Smaller hospitals are also just as well equipped to handle a major life threatening traumas, such as an asthma attack, and receive the same amount of quality care a trauma center would have provided.
Many people mistakenly assume that a bigger hospital means better ER services. Sibley has not tried to promote itself as the first choice for ER services in its surrounding community since it relies on its good reputation to get promoted through word of mouth. This overconfidence could result in the hospital losing a lot of potential medical business to other hospitals. It could become a major problem if that reliability on its reputation results in the failure to invest in new technology. Sibley is already technologically behind Washington Hospital Center and this gap could widen significantly to become potentially threatening to Sibley’s profits in the future. Sibley’s affluent client base also does not force it to be as frugal as other hospitals in the area, and this also could potentially expose Sibley to unexpected problems if it does not take advantage of new technologies to keep its prices and costs down.
Opportunities
Sibley’s opportunities are to promote itself more strongly within the DC community as being able to provide better patient care than other area hospitals. In order for it to compete with a major trauma center, Sibley’s staff will again need to consider equipping the hospital with the latest technologies, as Washington Hospital Center has already been doing, in order to maintain a competitive edge.
Sibley has the opportunity to increase satisfaction in their maternity ward by tagging babies to relieve new mothers’ anxieties with extra protection against possible accidental mix-ups between babies and other issues such as the abduction of babies from hospital rooms. Sibley also has the opportunity to build upon its areas of expertise through more efficient patient care by streamlining medication to patients in accurate and timely doses. This will also enable Sibley to cut its costs in the long run by remaining cutting edge in medical care through technology, like new RFID applications, in order to hold and maintain its title as one of the top hospitals in the country.
Threats
One potential threat to Sibley Memorial Hospital is its small trauma status. Washington Hospital’s trauma center may be unnecessarily taking Sibley’s clients based upon its trauma status when Sibley’s patients assume that they will be receiving better emergency care from a larger hospital with better ER services. Sibley also has very little incentive to cut its costs which can lead to overconfidence and risk of losing patients to other hospitals in the long run. With increasing medical costs and increasing difficulties for workers to obtain affordable health insurance, major hospitals are implementing new technology as quickly as possible in order to remain profitable. Sibley will need to be planning ahead for new upcoming trends in technologies in order to remain competitive.
IT Recommendation
Sibley could use RFID technology as a step toward increasing their cost efficiency, their patient care, and improving hospital security. Sibley could also take advantage of other barcode technologies that will graduate into RFID applications to help keep them current and quickly adapt to changes in the health care industry.
In conducting several interviews with both Sibley and Suburban Hospitals, we found that these smaller hospitals were the hungriest for tighter controls over their medications being delivered to their patients since they have smaller budgets and are less likely to make new technological investments. Currently, Sibley hospital runs on a Pyxis machine system which requires the use of a witness to operate and verify the transaction. Also, Pyxis machines require the medical practitioner to type a code into the keypad to identify themselves and retrieve the item needed. These Pyxis machines, which help hospitals to track inventory, slow down the ER and medical staff on every floor. There is currently barcode system that has come up with a solution to the Pyxis machine problem being used by WHC that Sibley could implement into their biggest problem – patient medications. The name of this coveted barcode system is called Bedside Medication Verification (BMV). Since RFID-only BMV is not in the market yet, Sibley could start implementing this hybrid barcode technology and be ready to upgrade up to the RFID-only BMV when it becomes available in the near future.
BMV is unique and will solve many problems for Sibley by increasing the quality of care that their patients receive and increases the hospital’s efficiency and security. “BMV processes data contributing to safe administration through the “Five Rights” of medication management: Right Patient, Right Medication, Right Dosage, Right Route, and Right Time.” (Meditech) BMV devices are programmed for each floor in which they alert the nursing staff as to when a patient is in need of their next dose of meds and then dispenses it to the nurse in the correct dosage based upon the patient’s weight. BMV devices are programmable to the care giving staff and allows for medical notations as well. This machine helps reduce the stress of the nursing staff, reduces medication theft, keeps exacting records and documentation while ensuring that patients receive the correct medication at the right time. By first implementing BMV, Sibley Hospital will become more up-to-date and ready to upgrade to the machines when they do transfer into an RFID system which is the current trend towards all systems using barcodes.
Sibley Hospital could also make use of automatic active RFID picture ID tags which would simplify the security and payroll services. The IDs would have a picture and imprint of the medical staff so they can be verified easily by a third party. The tag would have a specific frequency identifying each user, thus reducing the need of witnesses to slow down the hospital in using RFID compatible technology in place of Pyxis machines.
An additional IT recommendation for Sibley would be the implementing of RFID tags on hospital equipment for better inventory control. Hospitals have reported that equipment such as wheelchairs and IV pumps “go missing” at a very expensive rate. (Mass High Tech) Sibley Hospital could start by implementing this technology in its emergency room, not only to incur savings in equipment costs but to better track equipment location. In this way, in case of a life threatening emergency, doctors will quickly know the whereabouts and have access to the hardware that would save the life of people if found quickly.
Our last IT recommendation for Sibley Hospital would be to get the “smart-tag” for newborns and other “at risk” mobile patients, such as those with Alzheimer’s. Tags for babies are a brilliant and almost expected security service provided by hospitals today considering the proliferation of media attention towards newborn baby abductions. These tags will give new moms peace of mind and will increase maternity loyalty with Sibley which already has a strong hold in Northwest DC for “the hospital to have your baby” amongst those in the know in Washington, DC. Tags for Alzheimer’s patients would also be great security and cost savings implementation for Sibley Hospital. These patients might not be aware of their actions and leave the facility, which is the reason these patients need constant monitoring by nursing staff and/or security guards in every room at every hour. (Wistechnology.com) A bracelet with RFID technology could be attached to these patients and only if they leave a certain area of the hospital, security guards will be alerted. By implementing this one change Sibley hospital would experience a 50% decrease in Alzheimer’s patient security cost and that translates into big savings. Those savings could be reinvested in other areas of the hospital in order to develop IT competitive advantages to better position itself against its competitors.
Conclusion
Sibley Memorial Hospital should move on the new RFID technology and RFID-ready technology that Washington Hospital Center has already implemented for better patient care. RFID will help Sibley become more cost efficient today, help them maintain their competitive edge while preparing them for the unknown technological advances in the future. This exciting new technology has many applications in many inexpensive forms, making it only that much more of an advantage for Sibley Memorial Hospital to implement into their medical patient care system.
APPENDIX
Sibley Memorial Hospital Main Competitors
The Washington Hospital Center, part of the MedStar Health network, is the largest non-for-profit hospital in Washington DC. Licensed for 907 beds, it operates at near capacity. (Washington Hospital Center Website)
In its website, it advertises as having one of the most comprehensive heart programs in the country, treated the most cancer cases in Washington and leading trauma centers, neuroscience treatment, and kidney transplants. The Washington Hospital Center’s location in the heart of Washington DC and its high reputation in trauma and cardiology services make it appealing to residents across the city and the region. (Urban Institute)
The Georgetown University Hospital, also part of MedStar Health, is licensed for 609 beds. It had gained strong reputation in the areas of neurosciences, gastroenterology, gynecology, orthopedics, urology, comprehensive cancer care and transplantation among other services. Georgetown University Hospital shares with Sibley the affluent white population of North West Washington D.C. and also attracts patients from the Northern Virginia suburbs. (Georgetown University Hospital Website)
The Greater Southeast Community Hospital is a 450-bed hospital delivering comprehensive inpatient and outpatient services. It has served the residents of the Anacostia area for nearly four decades. (Greater Southeast Community Hospital Website)
The Providence Hospital is licensed for 382 beds in its medical facility and for 240 beds in its nursing and rehabilitation center. It is a full service community hospital and its services include geriatrics, maternity, orthopedics, outpatient diagnostic services, emergency department, and rehabilitative services, among others. It has been serving the African-American residents of Northeast Washington D.C. (Providence Hospital)
Howard University Hospital, licensed for 482 beds, is the nation’s largest African-American hospital. Its services include a Level I trauma center, a comprehensive care cancer center, a women’s wellness center and centers in transplant surgery, among other services. It is geared to the African-American population of Washington D.C. and the more affluent African American population of Prince George’s County. (Howard University Hospital Website)
The George Washington University Hospital, a for-profit hospital, is licensed for 371 beds and its services include Level I trauma, breast care, cancer care, cardiovascular care, childbirth services, neurology and neurosurgery among other services. Its central location, easy accessibility, and high reputation make it the hospital of choice of its neighborhood and the rest of the city. (GW Hospital Website)
References
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About GW Hospital. (2006). GW Hospital Website. Retrieved April 23, 2006, from http://www.gwhospital.com/p923.html
Bedside Medication Verification (BMV). Meditech. http://www.meditech.com/productbriefs/pages/ProductBriefsCSBMV.htm
Center for Breast Health. Sibley Hospital Website, Retrieved April 23, 2006, from
http://www.sibley.org/services/b_bcenter.tmpl
Chappell, L. (2005). RFID can be a Matter of Life and Death in the Medical World. Wistechnology.com. Retrieved April 29, 2006, from http://wistechnology.com/article.php?id=2383
Employment Philosophy. Sibley Memorial Hospital Website, Retrieved April 22, 2006, from http://www.sibley.org/employment/emphil.tmpl
ER Triage at Eisenhower Medical Center. http://www.emc.org/body.cfm?id=14
February 2005 Nine Tech Trends by Healthcare Informatics http://www.healthcare-informatics.com/issues/2005/02_05/cover.htm
February 2003 The Essentials of Healthcare Documentation by Claudia Tessier (Healthcare Informatics) http://www.healthcare-informatics.com/issues/2003/02_03/tessier.htm
Fiscal Year 2005 Statistics. (2006). Washington Hospital Center Website. Retrieved April 22, 2006, from http://www.whcenter.org/body.cfm?id=155
General Information/Accreditation/Mission Statement. Sibley Memorial Hospital Website, Retrieved April 22, 2006, from http://www.sibley.org/geninfo/mission.tmpl
Grand Oaks. Sibley Hospital Website, Retrieved April 23, 2006, from http://www.sibley.org/services/s_grandoaks.tmpl
Hendrickson, D. (2004). RFID in Hospitals show ROI promise. Mass High Tech Website. Retrieved April 29, 2006, from http://masshightech.bizjournals.com/masshightech/stories/2004/12/06/story9.html
History. (2006). Howard University Hospital Website. Retrieved April 23, 2006, from http://www.huhosp.org/About/History.htm
Hokskisson, R.E., Hitt, M.A., Ireland, R.D. (2004). Competing for Advantage. Ohio: Thomson Southwestern.
January 2003 Doctors Orders by Mark Hagland (Healthcare Informatics) http://www.healthcare-informatics.com/issues/2003/01_03/cpoe.htm
Mergent Online, Healthcare: North America, Retrieved April 22, 2006, from
http://www.mergentonline.com.proxyau.wrlc.org/IndReports.asp?Page=110&type=IndReports&ReportNumber=226Industry Reports
MinutClinic, (2006). Minute Clinic Website. Retrieved April 23, 2006, from http://www.minuteclinic.com/Home/Locations/Find_State/tabid/81/Default.aspx?StateId=MD+Baltimore+and+Suburban+MD
Ormond, B.A., Bovbjerg, R.R. (1998). The Changing Hospital Sector in Washington, D.D.: Implications for the Poor. Urban Institute. Retrieved April 22, 2006, from http://www.urban.org/uploaded PDF/dchosp.pdf
Our Hospital. (2006). Greater Southeast Community Hospital Website. Retrieved April 23, 2006, from http://www.greatersoutheast.org/SiteGen.asp?Section=hospital&Page=history
Personal MD. ER Triage Varies Widely. http://www.personalmd.com/news/a1999032906.shtml
Pyxis machines. UAB Health System. http://www.health.uab.edu/hospital/show.asp?durki=11319
Rehabilitation Medicine. Sibley Hospital Website, Retrieved April 23, 2006, from
http://www.sibley.org/services/s_rehabmed.tmpl
RFID tags on medication introduced in US. E-health Insider, November 17, 2004
http://www.e-health-insider.com/news/item.cfm?ID=931
Services & Facilities. (2006). Providence Hospital Website. Retrieved April 23, 2006, from http://www.provhosp.org/Servicesfacilities.htm
Sibley Memorial Hospital. (2006). SibleyWebsite. Retrieved April 22, 2006, from http://www.sibley.org/
Hospital Interviews:
Suburban Hospital: - Maharow Ershadi, Pharmacy
Sibley Memorial Hospital: - Desmo, Information Technology Department
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