A model for quantifying the value of RFID-enabled equipment tracking in hospitals

Authors:
Xiuli Qu;LaKausha T. Simpson;Paul Stanfield
Affiliations:
Department of Industrial and Systems Engineering, North Carolina Agricultural and Technical State University, 1601 E. Market Street, Greensboro, NC 27411, USA;Department of Industrial and Systems Engineering, North Carolina Agricultural and Technical State University, 1601 E. Market Street, Greensboro, NC 27411, USA;Department of Industrial and Systems Engineering, North Carolina Agricultural and Technical State University, 1601 E. Market Street, Greensboro, NC 27411, USA
Venue:
Advanced Engineering Informatics
Year:
2011

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Abstract

US hospitals spend millions of dollars on lost, misplaced and stolen equipment every year. Radio frequency identification (RFID) technology provides potential solutions to this problem. The nation's top healthcare providers installing RFID have demonstrated the benefits of RFID. However, most other providers have not followed suit due to the lack of models available to provide measurable steps in successful RFID installation and sustainability, and to predict legitimate returns on investment. To respond this need, we propose a Markov chain model that could quantify the benefits of RFID from reducing equipment shrinkage and staff time of searching for equipment and increasing equipment utilization in hospitals. Using the proposed Markov chain model, a sensitivity analysis is conducted to investigate the performance improvement by RFID-enabled equipment tracking in a hospital. Our results demonstrate that an RFID-enabled equipment tracking system could significantly increase equipment utilization. In addition, the proposed model may be used to evaluate the equipment preparation and maintenance policies in hospitals with RFID, and could be easily extended to quantifying the benefits of RFID tracking systems in other industries.