Everything You Need to Know about Hospital Inventory Management

Medical facilities and big healthcare organizations are tasked with the responsibility of managing a sizable inventory. A Hospital Management Inventory is basically a stock or data of all the medical resources such as equipment, medicines, and patient’s health data that are generally found in any small or large healthcare facility. 

While many hospitals have inventory management techniques in place, over half of those polled were manually managing their inventory using basic Excel sheets until the Health IT development  showed wonders. Regrettably, supply chain expenses are expected to be the largest cost to healthcare systems this year, exceeding labour costs for the first time.

The global hospital asset tracking and inventory management systems market grew from $25.28 billion in 2022 to $27.27 billion in 2023 at a compound annual growth rate (CAGR) of 7.9%. – Globenewswire

Thus, health institutions should prioritize using technology to aid in inventory management processes in order to cut costs, labor, and energy and maintain their inventories more accurately. 

Do you want to know how? Let’s discuss the management systems and everything you must know about hospital inventory management systems in this article below!

1. What is Hospital Inventory Management?

Hospital or Healthcare Inventory Management is a workflow that keeps track of the health system’s inventories, transactions, bookings, payments and other details. In healthcare firms that need to monitor medical products, order and administer drugs, or sell health items to patients, an inventory management system is essential. Inventory management solutions assist major firms avoid financial and product losses by maintaining a precise and up-to-date record of items and resources.

In the medical world, everybody including the doctors/nurses and other healthcare providers seems to be focussing on providing high-end patient care. Managing hospital inventory can be a challenging task because you need to monitor everything from   tracking medical supplies and purchasing equipment, monitoring for any spare medications, etc. Hospital staff units have to take care of a lot of things and  managing  them in an old fashioned way is simply much more time consuming. 

In order to solve the hectic task and to automate the process of managing the inventories, Healthcare Inventory management softwares is here to solve this problem. . But before going ahead and discussing more about healthcare inventory management softwares, let’s further explore more about the challenges faced earlier that will be solved by these softwares.

2. Why is Hospital Inventory Management Important?

Healthcare institutions are required to maintain records of diverse inventory items, such as pharmaceuticals, surgical instruments, patient prescriptions, and medical and wellness items.

Although using a basic Excel spreadsheet may appear sufficient for inventory management, it is more advantageous to adopt a simplified inventory management strategy. The implementation of an effective management workflow inside medical institutions has the potential to yield significant benefits in terms of time, financial resources, and labor. Medical institutions are under significant pressure to save expenses, and one strategy to achieve this objective is to optimize inventory management processes. 

By implementing effective strategic planning and meticulous monitoring, hospitals have the potential to achieve significant cost and time savings. Strategic pre-planning of necessary supplies has the potential to yield substantial cost savings and optimize time allocation, as exemplified by the significant reduction in expenses and time consumption associated with each surgical procedure. 

Healthcare inventory management refers to the systematic process of monitoring and controlling the flow of requests, buying, stock, transactions, health product revenue, and prescriptions within a health system. An efficient workflow can assist an organization in mitigating supply and financial losses by maintaining a precise and up-to-date product and supply record. Additionally, inventory management offers the following advantages:

Contract Compliance

Efficient healthcare inventory management facilitates the accurate procurement and utilization of items, ensuring that companies do not acquire an inadequate or excessive quantity of supplies. This serves as a safeguard against breaches of bulk purchase agreements.

Digitized Data

Virtual inventory management optimizes operational procedures by eliminating mistakes and reducing reliance on paper-based operations. The utilization of paperless data systems enables individuals to effectively arrange their information and inventories in a more efficient manner.

Improved Communication

An excellent healthcare inventory management system facilitates seamless communication between administrative teams and other healthcare teams, enabling efficient monitoring and control of supplies and equipment.

Equipment and Instrument Protection

Inventory management serves as an effective deterrent against theft by enabling the continuous monitoring and tracking of equipment’s whereabouts. 

3. Challenges of Hospital Inventory Management

3.1 Sorting Pharmaceuticals

Frequently, nurses are responsible for tracking and managing hospital supply chains. Additionally,  physicians waste time compiling lists of required medical supplies and instruments.

3.2 Pharmaceutical Loss or Shortage

Emergencies are a frequent occurrence in healthcare facilities. As a result, it is critical to maintain an adequate supply of medical equipment and resources. Certain products, on the other hand, have a storage life. As a result, it is critical to rotate it out on schedule.

3.3 Tracking Expiry Date of Pharmaceuticals

When the supplies are stocked up for emergencies, it becomes more challenging for the staff to keep a regular track on expiries of different items at a time and as a result sometimes many healthcare providers tend to pass on expired medical items to the patients.

3.4 Less Labourers And Pay

Focusing too much on cost-cutting leads to improper and mannerless workflow sometimes. Due to less labour pay, staff tend to neglect minor important things that again adds up a lot to a patient’s health and creates a challenge for them.

4. Now, Let’s see more about Hospital Inventory Management Software

Hospital inventory management software assists in tracking the consumption of all items inside the healthcare institution. Such inventory This system software enables the healthcare business or organisation to keep records of sales and expenditures. It also  identifies and accounts for edible and non-consumable drugs or goods.

Here’s what the famous oncologist of India has to say:

In any medical facility, the most often utilised resources are medications and surgical instruments. All facilities must keep a sufficient supply of life-saving medications, needles, and sterile surgical instruments such as injectors, aprons, and gloves. 

Keeping everything handy in stock is a professional’s job but making everything accessible to the patients in a certain regular flow while keeping a record of every item is the hospital inventory management software job. Not to mention the fact, you are just a robust software away to deal with all the medical challenges we discussed above.

With hospital inventory management software, hospitals, as well as several healthcare companies, can eliminate all the outdated, inefficient inventory tracking methods. Also, here controlling their inventory, tracking assets is no big deal. Everything can be easily taken care of. You know having a full-fledged, secure, cloud-based system on hand can offer a wide range of benefits. Inventories can be categorized in several ways such as distributing medications on the basis of their expiry dates or registering equipment with its maintenance details, etc.   

As a solo medical professional, handling inventories won’t be an issue but when it’s about an entire hospital or warehouse where stakes are high and everything has to be present at a larger scale, you need inventory management software. By applying these inventory management software, you will find yourself spending the least amount of time worrying regarding inventory and more time in providing the best care for your patients.     

5. How Hospital Inventory Management Software Helps in Solving these Challenges

Overspending and under-saving are common in hospitals because of the difficulty of controlling inventories. It might take a considerable amount of time for hospitals to keep track of all of their stock. 

The hospital software helps by offering a simple way for hospital workers to track their inventories. The program also facilitates order administration and the purchasing process, both of which would be more challenging without it. 

The great thing about this software is that it can be tailored to meet the demands of every given institution; you aren’t stuck with the same options as everyone else.

There are many moving parts in a hospital, but the ones that require immediate treatment must take precedence. If you need assistance creating a flawless system, you may find numerous qualified Healthcare Software Development companies to employ in India. The challenges that follow can be mitigated with the use of hospital inventory software by,

• Identifying consumables that are running low and placing new orders in time.
• Assisting in determining what should be ordered and how much should be kept on hand. 
• Eliminating unnecessary expenditures by slowing the rate at which stock is consumed. 
• Keeping workers from having to waste time searching for materials they need.

Hospitals rely on effective inventory management to guarantee that all necessary supplies and medications are available to patients at all times.

6. Features of Hospital Inventory Management Software/System 

Below are some of the innovative features that can be included in hospital inventory management system:

6.1 Stock Tracking

• The implementation of a real-time monitoring system for the tracking of pharmaceuticals, healthcare amenities, and equipment currently available in inventory.
• The process of creating distinct barcodes using an item locator system.
• The implementation of notification systems for monitoring supply levels, expiration dates, and the need for reordering.
• Implementing low stock warnings for essential products.

6.2 Medical Supply Management

• Management of medical supply data, including identification, pricing, and descriptions of intended use.
• The process of recording medical supply utilization cycles for the purpose of demand forecasting.
• The management of medical supply distribution

6.3 Medical Equipment Management

• The management and examination of equipment utilization.
• Examining the historical usage data of medical equipment.
• The management of medical device allocation.

6.4 Inventory Automation

• The process of automated order placing.
• Monitoring the expenses of medication and medical supplies.
• Automated management of expiry dates.

6.5 Security and Compliance

• Allowing users to log in depending on their assigned roles.
• Facilitating appropriate and equitable access for all members of the care team.
• The objective of this effort is to guarantee adherence to the Health Insurance Portability and Accountability Act (HIPAA).
• Establishing the guidelines for generating discrepancy reports.

 7. Benefits of Healthcare Inventory Management Software

7.1 Simplified Inventory Management – Tracking Asset

If you want to make the process of inventory management seamless, you simply have to use the healthcare inventory management software. 

Healthcare stocks and supplies keep on fluctuating at a large scale – all thanks to the present unpredictable scenario. An ideal medical inventory management software can definitely automate these tedious procedures and reduce human effort so that they can focus on taking care of their patients.  

7.2 Reducing Inaccuracies, Easy Analytics & Maintaining the Supply

Inventory & stock management is not a one-time procedure. It is an ongoing process happening throughout the year. Earlier, when all these tasks were done by humans, the result was pretty much inaccurate and this resulted in improper stock management. 

With the adoption of inventory management system, there is no air around. Data is being recorded and tracked pretty much precisely. Also, almost all your orders can be synchronized and stock levels get adjusted whenever you make a sale. 

7.3 Real-Time Tracking

The program built in the software enables real-time tracking, this implies that the inventory is regularly refreshed up to date which gives you access to a precisely counted inventory whenever you add or sell items.

Additionally, you may manage inventory transactions and have them regularly reordered when supplies run low. If the goods do not arrive at its location, you will be notified. Isn’t it brilliant?

7.4 Cost- Savings

Streamlining your inventory management is cost savings. Till now you had a fair chance of eliminating the inventory costs associated with human errors but what’s more! Well, firstly, inventory management software can save you from having nightmares of running out of supplies.

In addition, it also reduces the scope of over drugs.  This is not it! The biggest news of all is automation. Earlier a significant loss has been observed due to stock-outs and overstocks. But not anymore! All thanks to the hospital inventory management systems. 

8. Types of Hospital Inventory

Numerous healthcare facilities exhibit a deficiency in implementing a uniform inventory management system, however, the adoption of a consistent approach has the potential to substantially reduce expenditures. There exist two distinct categories of healthcare inventory management, necessitating an extensive understanding of the advantages and drawbacks associated with each. Healthcare institutions have the option to employ many strategies for managing their inventories, which include the following:

8.1 Periodic Inventory

The periodic inventory system is a method used in accounting to track and manage inventory. It involves doing physical counts of inventory at specific intervals. The process of periodic inventory necessitates manual updating of inventory data by staff. In this particular approach, staff engage in periodic inventory-taking. For instance, it is common practice for organizations to do inventory checks on a weekly basis or at the culmination of a comparable time frame. Although this approach may be adequate for minor healthcare establishments, it is suboptimal for hospitals and more extensive healthcare institutions. 

This inventory management approach presents a considerable margin for mistake and detracts from the allocation of time towards other critical responsibilities. The perpetual inventory system is more advantageous for larger healthcare institutions. 

8.2 Perpetual Inventory

The perpetual inventory management is a system that maintains a continuous and automated process of updating inventory data. The utilization of a perpetual inventory system necessitates the acquisition of sophisticated software, which may incur higher expenses compared to the traditional manual periodic inventory approach. However, the advantages offered by the perpetual inventory system outweigh the associated costs. Perpetual inventory systems encompass crucial elements, including the recording of orders, shipments, additions, and removals. Medical personnel have the ability to continuously monitor the utilization of equipment, ensuring that all supplies are consistently documented and accurately recorded.

9. Hospital Inventory Management Best Practices to Follow

9.1 Collect Data From Supply Chain

With the help of the supply chain, data healthcare businesses can save a lot of money. And further, businesses can use that data to identify whether the techniques used in inventory management are cost-effective or not.

Failure in using supply chain data effectively may lead to millions of cheque in lost revenue. Rather than that, one must take the data into consideration to analyse whether your inventory management system is as efficient as it is supposed to be. 

With the concern of society’s health and the easy wonders of IT, more firms are trying to establish IT platforms that support value-based models. By adopting these practices, healthcare ventures may establish a more precise correlation between the materials required and clinical outcomes.

9.2 Improve Recordkeeping

In case, if you aren’t using one already, chances are pretty high of you considering a platform that knows how to differentiate between the current stock and will it be in demand in the future? Here records must be reviewed at regular intervals so you know there is no scope for error. In the end, you get a smooth hospital inventory supply management. 

9.3 Securing Sensitive Data

Each healthcare practitioner is acquainted with HIPAA, that safeguards patients’ health history from unauthorized access. It is critical to maintain the same level of safety for your inventory system, as your stockpile is what enables you to offer service to the patients you treat.

If unauthorised staff enter incorrect inventory counts or other data inconsistencies, it may create havoc in hospitals and other facilities that rely on discipline and accuracy to function successfully. Therefore, practising security is one of the major do’s one should follow.

9.4 Organize Your Inventory to Avoid Redundancies

An essential strategy for effectively managing inventory is maintaining a high level of organization. An untidy or unorganized storage area might provide challenges in maintaining correct inventory records. There are several potential issues that might arise in the context of inventory management. These include misplacement of things, the possibility of a shortage being undiscovered, and the potential for over-ordering due to poor organization of inventory. As an illustration, it is recommended that healthcare personnel prioritize the placement of things approaching their expiration date at the forefront of shelves, as opposed to the rear, in order to facilitate their use prior to those with a more distant expiration date. It is advisable to position often utilized and extensively required products in close proximity to the entrance of supply rooms. 

10. Conclusion

Surviving in the hospital sector is not easy but it is a necessity and having an inventory system can definitely ease your work. With the help of a hospital inventory management software, you don’t have to compromise on your patients anymore. Feel free to get in touch with us for efficient and automated inventory management software.