1. Supply Chain Management Reprocessing of Single-Use Devices with Vanguard Medical Concepts Cost Containment & Environmentally Preferred Purchasing Initiative Catholic Healthcare West February 14, 2003 Pam Johnson, RN, MHA Contract Administrator

2. Supply Chain Management Why Vanguard Medical Concepts? åRe-manufacturer of a diverse product list of disposable, single-use devices åFDA registered as 3rd party Medical Device Reprocessor å8 million devices, 10 years experience å100% function testing of re-manufactured devices at Vanguard plant åQuality systems regulations accountability å$25 million liability insurance for each device

3. Supply Chain Management Executing the Plan, Part I Refer to Handout Checklist for Getting Started Executive support for commitment to improved collection and use of re-manufactured devices CFO & MM director meet Vanguard Rep Analysis of new product purchase history Facility Implementation Team (FIT teams) Initiative sponsored by CHW clinical leaders from the Surgical Services & CV Councils, MMAC & ICPs/Risk Managers

4. Supply Chain Management Executing the Plan, Part II Monitoring enterprise-wide compliance Compliance equals savings Access to Quality reports for ICPs - website Department team meetings to present best demonstrated practice and answer emotional concerns by staff and MDs Recognize High Performers Patient charges & Questions about consent?

5. Supply Chain Management Threats to the Plan - and response àImpact to Original Manufacturer (OEM) profit ñExpect letters from OEMs directed at physicians & hospital managers to instill fear and stir emotions. èResponse: Get the facts to physicians, board approved policies and FDA policy for 3rd party reprocessors. Reply to the OEM requesting that they stop the counterdetailing at your facility. àEmotional response from staff & MDs ñStaff can de-rail the best plan with non-supportive actions èResponse: Allow for meetings as a department group and individually (manager & staff/MD) to discuss personal emotions and respond with fact based answers and expectations for staff performance. Let them kick the tires and get their concerns openly addressed. Special emphasis to the Infection Control Practitioner support, Collection & Re-stocking of product.

6. Supply Chain Management More Resources vHandouts uA Department Managers Checklist for Getting Started uWebsite resources: Association of Medical Device Reprocessors (AMDR) & Vanguard Medical Concepts uFDA Classification of Medical Devices uVanguard Class I & II product list & 510K submission vPublications uBiomedical Instrumentation & Technology, Nov/Dec 2002; Development of a Program Model to Evaluate the Potential for Reuse of Single-use Medical Devices: Results of a Pilot Test Study uHealthcare Purchasing News, May 2002; Hospitals find Reprocessing Solutions to Financial and Risk Problems (features Vanguard and Catholic Healthcare West partnership)

7. Supply Chain Management $$$ Savings Sample Hospital Opportunity 273 beds: Surgical Services and CV service line Product Categories: Arthroscopic Shavers & Wands, BBB, GI biopsy forceps, DVT garments, EP catheters, Femostops, Laparoscopic Instruments, Open & Unused, Phaco needles, Suture Variables: new units purchased, new unit cost, reprocessing fee, average # of turns per product, compliance to collection rate 30% collection = $88,000 annual savings 60% collection = $177,000 annual savings 90% collection = $266,000 annual savings

8. Supply Chain Management For More Information See these Web Pages VANGUARDwww.safe-reuse.com AMDR www.amdr.org

9. Supply Chain Management CLASSIFICATION OF MEDICAL DEVICES CategoryPerceived Risk CategoryPerceived Risk Class 1 Low Class 2 Medium Class 3 High

10. Supply Chain Management