Using the Just-in-time method helped this Indian hospital reduce waste, save cost

Hospitals are complex organizations that provide a multitude of services to their patients, physicians, and staff. Each of these services – which include pharmaceutical, laboratory, surgery, dietary, linen, housekeeping, administration, […]

Hospitals are complex organizations that provide a multitude of services to their patients, physicians, and staff.

Each of these services – which include pharmaceutical, laboratory, surgery, dietary, linen, housekeeping, administration, and others – have specific, and often unique, material and supply needs.

As such, the hospital product line often has a mix of high-cost and low-cost items, perishable and durable goods, that are consumed in varying quantities. The storage of these products can often make up a large proportion of the hospital’s operating expenses.

This was exactly the challenge facing the Oncology department at India’s Aster CMI Hospital, which was launched in July 2018.

According to the hospital’s awards submission, the main concerns of the department were “the cost involved in managing medication inventory, leading to storage issues, wastage, re-order level…while additional workforce for the storage and issuing of chemotherapeutic medications and cytotoxic handling policies was also needed”.

In order to reduce the inventory costs, wastage and increase patient safety and quality care, Aster decided to adopt the Just-in-time (JIT) inventory management model for their Oncology medications.

The hospital explained: “Oncology medications are suitable for this JIT model because of the handling policies of chemotherapy. This model is especially critical with the increasing use of high-value immunotherapy drugs.

“The process of JIT was standardised and structured following a deep dive into…our inventory, cost, human resources, and revenue. The JIT model can be summarised as a system to eliminate waste and achieve excellence in the Oncology department.”

The hospital added that the goal of adopting the JIT model is to ensure their patients’ chemotherapy cycles are performed as per the scheduled date and time, while the supply chain management process is maintained in a timely and cost-effective manner.

“We focused on reducing the capital investment in real estate requirements, reducing capital expenditure (CapEx) of the primary consumable cost in oncology drugs, and reducing wastage due to expired medications,” said Aster CMI Hospital. “All the while, we also maintained productivity in order to generate similar revenues. All of this combined led to an increase in profitability.”

How the JIT model works

Led by the hospital’s Lead Consultant Dr. Vijay Agarwal (Medical Oncology), and supported by Chief Executive Officer Mr. Ramesh Kumar S., the concept was implemented to ensure that minimal inventory is maintained at all times, and the JIT delivery process is compliant for all oncology drugs.

The steps in the JIT model, which involves a team of In-Patient and Out-Patient Coordinators, Clinical Pharmacists, the Supply chain management team (Purchase and drug store), as well as nurses and clinicians, are summarised as follows:

STEP 1: Patients are informed about their next chemotherapy cycle by the in-patient/out-patient coordinators at discharge, which is documented in the discharge summary. New patients are given a date to start their chemotherapy as per the doctor’s advice.

STEP 2: The patients are tracked by the coordinators based on the next date of their chemotherapy. Patients are contacted to inform them about the appointment for chemotherapy, and the admission date is confirmed. Following confirmation from the patient, a list of the medication required is prepared.

STEP 3: The patient list is prepared with the medications required, and shared with the procurement team two days prior to the patient admission.

STEP 4: Purchase order is raised and sent to the approved vendors for delivery of medications on the specified date and time.

STEP 5: Vendor delivers indented medication to Aster CMI Hospital on the evening before the scheduled chemotherapy.

STEP 6: Supply chain management team receives the indented medication at the Pharmacy.

STEP 7: Nurse from the Oncology department places the indent for the medication.

STEP 8: Medication is transported to the Oncology ward as per the indent placed.

STEP 9: Both the Registered Nurse and the Clinical Pharmacist cross checks the medication received is as per prescription.

STEP 10: Medication dilution is done in the biosafety cabinet. Medication is then administered in accordance with the Rights of Medication.

Reduced wastage, lower cost, other challenges

As a result of the JIT model, Aster CMI Hospital was able to save on the cost of landholding a pharmacy store. In addition, they cut down on the manpower resources required, while also reducing their required inventory holding space by 60L.

All of this equated to an 18% improvement in their margins, as well as significant reduction in inventory wastage.

Apart from its benefits, however, the JIT model also brought about several different challenges, as the hospital elaborated: “It has been observed at times that drugs are not delivered punctually due to a shortage of supply, or a breakdown in coordination. We addressed this lacuna by efficiently planning and rescheduling the cycle as and when there is a shortage of drug supply.

“Then, there are times when patients reschedule the dates of their therapy, while unforeseen ‘acts of God’ – such as floods, the COVID-19 pandemic, strikes and public curfews – can also cause a delay in the delivery of medications to the hospital facility.

“Last but not least, the main challenge we face is miscommunication between the different stakeholders, starting from the patients, clinicians, nurses, coordinators, pharmacists, supply chain management, vendor, transport, etc.”

Nonetheless, Aster CMI Hospital was eventually able to iron out these kinks, allowing them to see approximately 220 patients a month.

More importantly, the new initiative has helped to improve the patient experience and clinical outcomes.

The hospital said: “The patients have been satisfied with their therapy being coordinated in an efficient manner, with effective communication among the team.

“Initiating and adopting the Just in time model for Oncology drugs in real life situation has helped Aster CMI hospital to continuously provide therapy on time to the patients by combatting the challenges faced.

“The JIT concept has been successfully adopted and is ongoing only at Aster CMI Hospital among the Aster DM Healthcare group of Hospitals. We are looking forward to evolving further with the leading technology. The most rewarding would be extending this program digitally across Aster Centres, leading to a multiplier benefit for all our hospitals.”


Nominations for HMA Awards 2022 are now open! This year, awards will be handed out in seven categories, including Financial Improvement, Patient Experience Improvement, Infection Control Excellence, Clinical Effectiveness Improvement, Most Advanced Healthcare Technology, and more. For more details, click here.