GS1 Global Location Numbers are expected to improve supply chain performance
There’s a new global healthcare standard that will change how hospitals, clinical laboratories, and pathology groups get supplies from vendors. This standard will be launched as part of the GLN Healthcare Sunrise. It is an example of how the globalization of healthcare is about to take another significant step forward.
Pathologists and clinical laboratory managers should take time to learn about GS1 Global Location Numbers (GLNs). This will be a new standard and the GS1 Healthcare US Workgroup has declared that, as of December 31, 2010, all those involved in health care supply chain operations are expected to adopt the use of GLNs in lieu of custom account/location numbers. The first step is to standardize healthcare location information by December 31, 2010. This event is referred to as the GLN Healthcare Sunrise.
The goal is to provide a uniform, global system that healthcare suppliers and healthcare purchasers can use to identify physical locations where goods are delivered or where bills and invoices are received. These numbers can help track medical supplies and devices through the supply chain, even to the patient bedside if needed. Another benefit is that GLNs will be used to ensure that invoices and payments go to the correct location.
Healthcare is coming late to the GLN system. Other industries in the U.S. and around the world have been using GLN effectively for a number of years. The system has proven an efficient way to communicate complex location information.
The GLN system was created by GS1, an international non-profit organization that works to standardize supply chain systems. Remember the familiar UPCs? Universal Product Code (UPC) bar codes were a product of GS1, as were other supply chain innovations.
The system works because of its simplicity. A GLN is a unique identifier for specific locations within an organization. The number is based on a system that assigns a basic GLN prefix to each legal entity. The legal entity, such as a hospital, clinical laboratory, or pathology laboratory, would then assign additional numbers to various locations within it. For example, the GLN for a hospital laboratory would likely include the identifier for the health system, for the hospital, and for the laboratory itself.
The number takes the place of inefficient descriptions. Take an example such as “ABC Health System, XYZ Memorial Hospital, 1483 Hospital Road, Building A, Second Floor, Laboratory Storage Closet.” Instead of this long description, a series of numbers will identify the specific location.
The process begins with the assignment of the prefix number to the legal entity by GS1, an international non-profit organization that exists to create global standards for supply chain operations. The legal entity then assigns additional numbers to physical locations within the entity. It is up to the individual legal entity to decide how many locations within it need to have unique GLN numbers.
For example, a small hospital might do very well with just its prefix number. In the GS1 database, that prefix would be tied to a physical address (such as 1483 Hospital Road, Our Town, State, 12345, USA). If all supplies are delivered to a loading dock at that address, no further numbers need be assigned.
For a larger hospital or integrated health system, with several physical addresses to which outside vendors deliver goods, more numbers could be assigned. For example, if a health system owns two hospitals, they would share the same prefix that ties them to the health system, but would have unique numbers that are tied to their physical address.
Or, for instance, if testing supplies were delivered directly to a storage room in a laboratory within a hospital, that location would also have its own unique number, which would include the prefix, the unique number for the hospital and a number that identifies the laboratory and even a specific shelf in the storage room, if needed.
All these unique numbers are entered into the GLN Registry for Healthcare®, maintained by GS1, and tied to the physical location. Anyone within the supply chain can use the database to accurately locate any delivery point that has a GLN.
Some group purchasing organizations (GPOs) have already begun using the system with healthcare facilities. Premier, Inc., which operates a group contracting and purchasing organization for 2,300 hospitals and 66,000 other health care sites in the U.S., has been working with a group of its members to implement the system in advance of the December 31 Sunrise date.
In a recent edition of Modern Healthcare Deborah Templeton, Vice President of Supply-Chain Services for Geisinger Health System, reported on her organization’s implementation of GLNs through the Premier project.
“We process more than 15 purchase orders a day with our main vendor, representing hundreds of products,” Templeton wrote. “With GLN as a communication enabler, we are reaping benefits including streamlined communications, more reliable product shipments, and cleaner business documents.” She says she expects to widen the system to other vendors once they establish the system through the Premier project.
A year after the GLN Sunrise, in December 2011, the health care industry will begin using Global Trade Item Numbers (GTINs) to uniquely identify items in the health care supply chain. As with the GLNs, health care is playing catch up to most other industries, which have been using the GLNs for many years.
Managers of clinical and pathology laboratories that receive supplies directly from vendors should take steps now to be sure that their facilities are in compliance with the new system. For stand-alone laboratories, the first step is to contact GS1 USA for a prefix and information on how to use the system. For medical laboratories that are part of larger legal entity, such as a hospital, health system or corporation, now would be a good time to discuss with administration whether your laboratory needs a unique identifier.
Be An Early Riser: There’s Still Time to Prepare Hospitals for Global Location Number Sunrise, by Deborah Templeton, Modern Healthcare, March 8, 2010, p. 23.
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GLN in Healthcare Implementation Guide
Global Trade Item Number® (GTIN®) Implementation Guide
Global Location Number (Wikipedia entry)