Improving Operational Performance

8 steps to creating a supply formulary that works

Want to standardize and cut costs? Here’s how to develop a formulary and ensure its survival.

1 Evaluate your business practice

Make sure you know what’s going on. What formulary is in place, if any? How do you currently capture supply charges? What is your payor mix? What is your patient mix? Do you have protocols or guidelines in place? When were they last reviewed? What are the policies and procedures that are followed to order supplies? What controls are in place to ensure compliance? What mechanism do you have to measure outcomes?

2 Develop a formulary task force

With careful planning, a formulary can be completed in one day. The formulary task force should include no more than 10 people and should represent different areas of the business. A good sampling would include floor or field nurses, certified nursing assistants or care techs, nursing specialists such as the WOC nurse, supply coordinator/purchasing, management staff, financial representation, and case management.

3 Establish a protocol

Protocols are especially important with wound management. Solicit the assistance of a wound care specialist. Incorporate national guidelines for wound care, textbooks, articles, standards from wound care organizations and manufacturers’ information to provide research and educational data for your protocols. Also, make protocols flexible. Algorithms that guide the clinician to appropriate treatment modalities based on current literature are a tremendous help. Guide the clinician to assess the etiology, size, color, depth, drainage and location of the wound. Based on this information, the protocol can recommend a moist or absorptive type of treatment.

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4 Work with your physicians

Many physicians welcome recommendations from well-educated colleagues. Inform the physician of the formulary and protocols to maintain consistency in patient care. Although physicians are not typically members of the formulary task force, they are crucial members of the patient care team. Therefore, the physician needs to be aware of the facility or agency’s practices and the positive outcomes associated with their protocols to establish physician support.

5 Plan and prepare in advance

This is a critical piece of the equation and will take the most time. Three to six months of supply usage data is usually adequate to help you establish a baseline for needed products. To get the information, pull invoices. This is time-consuming, but the most accurate. Another method is the analysis of utilization reports. Make sure the report includes all supply purchases. You might need a combination of reports and invoices, especially if you receive products from multiple vendors. Contact your current vendor for historical usage and pricing information. Create a spreadsheet of the products, including item number, description, unit of measure and price. Organize products into categories, such as wound care, urologicals, incontinence or nursing supplies to make it easier for the committee to evaluate.

6 Design an evaluation process

Products are evaluated based on function, ease of use, historical data, quality, wear time and acquisition price. All committee members need to agree on the objectives. The moderator needs to clearly communicate the objective of the committee. Once a product is agreed upon, the packaging becomes an important component of the formulary. For example, you do not want to order a box of 10 or even 100 if individual items would work, and vice versa.

7 Assemble and coordinate comprehensive educational tools and enablers

Any tool that makes the nurse’s job easier is a great benefit to formulary compliance. Pocket-sized or notebook-sized formulary guidebooks that include all necessary ordering and clinical information are key to a successful program. Credit card size reminders that can fit on the back of a name tag, a pocket or a wallet can also be a handy resource. Compliance with the formulary can be directly related to the ease in ordering, so simplify the product categories (i.e., “wound care” or “nursing supplies”).

8 Measure formulary compliance

Don’t expect 100 percent compliance. There will always be exceptions. Strive for greater than 90 percent formulary compliance. This will also allow room for you to look at new technology and products, which will continue to improve outcomes. Don’t box yourself in. A case in point: formulary compliance reporting. Understand up front that this is a dynamic process. It takes six months from implementation to establish a formulary that is proven and reliable. Therefore, you need utilization reporting that measures formulary compliance and allows you to periodically review and make appropriate changes.