How a Virtual Item Master Improve Healthcare Supply Chain Management

5 Best Examples Of Big Data In Healthcare - virtual item master

How Does a Virtual Item Master (VIM) Improve Healthcare Supply Chain Management?

In the intricate web of the healthcare industry, supply chain management serves as a critical backbone, ensuring the seamless flow of medical resources, equipment, and services necessary for patient care. Healthcare supply chain management involves the orchestration of procurement, logistics, inventory management, and distribution across various healthcare facilities, from hospitals and clinics to pharmacies and beyond. The efficiency and effectiveness of this process directly impact patient outcomes, operational costs, and overall healthcare delivery.

Amidst the complexities of healthcare supply chain management, the emergence of innovative solutions has heralded a new era of efficiency and optimization. One such groundbreaking concept is the Virtual Item Master (VIM), a dynamic and centralized database system that revolutionizes the management of healthcare inventory. Unlike traditional inventory systems, VIM transcends the limitations of physical space and manual record-keeping, offering a comprehensive digital repository that stores detailed information about each individual medical item or product.

Throughout this article, our focus will delve into the transformative role of VIM within healthcare supply chain management. We will explore in-depth how the integration of VIM into healthcare operations enhances efficiency, transparency, and cost-effectiveness. From optimizing inventory levels to facilitating informed decision-making and fostering strategic supplier relationships, the utilization of VIM emerges as a pivotal factor in modernizing and improving the healthcare supply chain landscape. Through this exploration, we aim to elucidate the profound impact and promising prospects that VIM brings to the forefront of healthcare logistics and management.

Healthcare Supply Chain Industry Challenges?

Healthcare institutions typically have huge demands for supply procurement. At the heart of their supply chain system is the item master, a list of all items purchased by the institutions. These item master files can range from 18,000 to more than 100,000, with thousands of inaccurate or duplicate items.

Because item masters are constantly being updated, 30% of systems are inaccurate, according to a recent study by AHRMM (Association for Healthcare Resource & Materials Management).

In addition, the sheer size of item masters and the number of users make housekeeping difficult. Common errors may include:

  • New catalogue information is not added in a timely fashion.
  • Discontinued items not deleted.
  • Codes or descriptions are not typed correctly.
  • One single item may appear in more than one entry with different definitions.
  • Many contracts are kept for similar items in the system.

Furthermore, hospital networks with disparate systems cannot keep up with the ongoing churn of item master information to maintain accuracy. Through Meperia’s market analysis, including over US$9 billion in supply spending, the following challenges are discovered:

  • 24% of supply chain staff time is spent on fixing errors post-purchases
  • 15% occurrence rate of different prices paid for the same product
  • 30% item master content churn outdates “source of truth”
  • 12% of overpayments are made on costly PPI (Physician Preference Items)

Statistics currently reveal that the administration cost of the supply chain accounts for over 40% of enterprises’ estimated operational expenditures. This cost ranked second in the total operating expense of most hospitals, only following labour costs. Therefore, there has been a great need to develop a system to manage supply chains to minimise unnecessary costs while trading medical equipment for hospitals. Old systems must process data accurately, losing around 60% of cost-saving opportunities for trading supplies and equipment between hospitals/healthcare institutions and suppliers.

What is Virtual Item Master (VIM)?

At its core, VIM serves as a hub of accurate and up-to-date data, encompassing item descriptions, specifications, pricing, supplier details, and contract information. It acts as a unified platform, consolidating diverse inventory data sources into a single source of truth for healthcare organizations. This centralized repository fosters transparency, accuracy, and accessibility, empowering healthcare entities with the necessary insights to streamline procurement, mitigate supply chain disruptions, and make informed decisions for optimal patient care.

Here’s a breakdown of what VIM is all about:


  • Item Master Items: These are non-contractual items with listed prices, added manually or imported from an ERP system.
  • Contract Items: These are items linked to specific contracts, also added manually or imported from an ERP.
  • Hosted Catalog: This section encompasses items from enabled suppliers within a procurement platform like Meperia.

Key features:

  • Improved data accuracy and consistency: By having a single source of truth, VIM reduces errors and inconsistencies in item data across different systems.
  • Enhanced visibility into purchasing: VIM provides a centralized view of all items and services, making it easier to track spending and identify opportunities for cost savings.
  • Streamlined procurement processes: VIM can automate tasks such as item requisitioning and approval, making the procurement process more efficient.
  • Better supplier collaboration: VIM can facilitate collaboration with suppliers by providing them with real-time access to item information and pricing.

Benefits of Virtual Item Master (VIM) in the Healthcare Supply Chain Management?

Single Source of Truth

  • Eliminates duplicate entries and inconsistencies: VIM acts as a central repository for all item and pricing data, ensuring everyone across the healthcare system is referencing the same accurate information. This can significantly reduce errors and confusion in ordering, billing, and inventory management.

Enhanced Visibility and Transparency

  • Provides a real-time overview of inventory levels and spending: Healthcare providers can easily track stock levels, identify potential shortages, and optimize procurement strategies with a clear view of item availability and costs across all facilities.
  • Improves contract compliance: VIM helps ensure that healthcare providers are always purchasing items at the contracted price, preventing overspending and optimizing budget allocation.

Streamlined Procurement Processes

  • Automates manual tasks and reduces paperwork: VIM can automate tasks like item requisitioning, approval workflows, and purchase order generation, saving time and resources for procurement teams.
  • Simplifies ordering for clinicians: Clinicians can easily access accurate item information and pricing within their EHR systems, reducing the time spent searching for supplies and ensuring they order the correct items.

Improved Cost Savings and Efficiency

  • Reduces maverick spending: By centralizing item and contract data, VIM helps prevent unauthorized purchases outside of negotiated contracts, leading to significant cost savings.
  • Optimizes inventory management: VIM enables better forecasting and demand planning, allowing healthcare providers to reduce stock holding costs and minimize the risk of stockouts.
  • Increases operational efficiency: Streamlined procurement processes and improved data accuracy lead to faster turnaround times and reduced administrative burden, freeing up staff to focus on patient care.

Enhanced Supplier Collaboration

  • Provides real-time access to item information and pricing for suppliers: This fosters better collaboration between healthcare providers and suppliers, improving communication and streamlining order fulfillment processes.
  • Enables joint demand planning and forecasting: VIM can facilitate collaboration with key suppliers to optimize inventory levels and ensure product availability, leading to a more resilient supply chain.

Overall, a VIM can be a transformative tool for healthcare supply chains, improving data accuracy, visibility, efficiency, and cost-effectiveness. By creating a single source of truth for item and pricing data, VIM can empower healthcare providers to make informed purchasing decisions, optimize inventory management, and ultimately deliver better care to patients.

Ensuring the accuracy of the virtual item master (VIM)

The VIM isn’t a stagnant repository solely housing item and price data; it’s a dynamic entity necessitating vigilant management to maintain accuracy and stay updated with new agreements and revisions to existing ones. Organizations handling numerous contracts should integrate them into a system capable not only of handling substantial datasets but also seamlessly interfacing with a front-end purchasing system in an automated manner.

While the VIM typically contains vast datasets for most organizations, not all contract line items within it need to be accessible to the requester for procurement. By monitoring and predicting demand based on user behaviors and clinical activities, the optimal timing for publishing a contract can be determined.

For instance, the VIM might encompass multiple contracts for the same item under different agreements. In such scenarios, collaboration between the supply chain team and clinicians can determine the contract that not only aligns with clinical requirements but also supports the organization’s strategic objectives, such as rebates, tiered pricing incentives, volume commitments, or simply the agreement with the most competitive prices. This level of adaptability and oversight empowers supply chains to swiftly respond to real-time shortages and disruptions without compromising their strategic aims and objectives.

Case Study: Healthcare Supply Chain Solution Developed by Bestarion Integrates VIM and AI

Meperia’s Strategic Supply Sourcing solution - Integrates Virtual Item Master (VIM) and AI

Meperia’s Strategic Supply Sourcing solution helps drive sustainable savings for Med-Surg supplies by enhancing item master content. Through better item master content, the solution empowers users to make the right choice at the start of the procurement process. Real-time insights help monitor compliance with savings goals.

The system is integrated with the Cloud Computing technology and functionalities designed and developed by Bestarion to launch an automated supply-sourcing platform with the highest efficiency in the healthcare sector.

It is a complete and effective solution to the above challenges using Virtual Item Master (VIM), Artificial Intelligence (AI), and formulary procurement control.

  • VIM is a cloud-based Software as a Service (SaaS) offering that expands the limits and capabilities of traditional item masters. It enables more efficient maintenance of product content, standardization of item requests and enhanced user-search capabilities in a single electronic repository.
  • VIM fully integrates with an organization’s Materials Management Information System (MMIS) and enterprise resource planning (ERP) solution.
  • The solution combines a virtual item master with an Artificial Intelligence (AI) engine. The organization’s supply chain data is captured and normalized with manufacturer catalogue data. Information is continually updated and normalized so that data stays “clean.”
  • This industry-first, patented AI engine normalizes and attributes data, allows for the definition of functional equivalency by product family and recommends lower-cost alternatives at the point of requisition.
  • The industry-first, preemptive formulary enforcement helps give users unprecedented control to find the desired products at the point of requisition, including an anywhere-access mobile option.

Core technologies that are used for this application:

  • Ruby on Rails
  • Data Discernment Engine
  • PostgreSQL
  • Ext J.S.
  • Apache 2 + Phusion Passenger + Ruby Enterprise Edition
  • Amazon Infrastructure – Cloud Computing
  • GUI (Graphical User Interface) was powered by Ext J.S. framework and Fusion Chart

How It Works

The Supply-sourcing solution provides unprecedented industry’s first capabilities in all three major areas of supply procurement: Find, Compare, and Control.

For the ‘Find’ function:

  • VIM helps identify items through pictures, aliases and unlimited attribution, giving requisitioners guided access to all available items.
  • The solution provides access to a standard catalogue, The Matrix, containing over 2 million normalized and attributed items, including photos and full-length product descriptions.
  • Users (clinicians) gain a consumer-typed search capability, including photos, for easy identification, and hence can find the right products more efficiently.

For the ‘Compare’ function:

  • The system can recognize different naming conventions for the same or like items.
  • It can readily identify functionally similar products so organizations can group and compare items for standardization.
  • With integration in all contracts, users can compare things to help make the right decision to control spending.

For the ‘Control’ function:

  • Healthcare organizations’ requisitioners are presented with pertinent information, including the last price paid, the correct contract price, and a less expensive alternative.
  • Any non-compliant item request prompts an alert to require approval routing, including a delegation feature when approvers plan to be out of the office.


This Strategic supply-sourcing solution helps:

  • You are saving up to 15% of annual supply chain spend, or US$250 million and increasing.
  • More than 1000+ healthcare facilities in the US use this platform.
  • More than 34,706 users subscribed.
  • Procurement efficiency is mainly enhanced.

Future Trends and Innovations in VIM for Healthcare

Emerging technologies and innovations in VIM for healthcare supply chains:

  1. Artificial Intelligence (AI) and Machine Learning (ML) Integration: Anticipate advancements in AI and ML to enhance VIM capabilities. These technologies can analyze historical data to predict demand patterns, optimize inventory levels, and automate decision-making processes within the supply chain.
  2. Blockchain Implementation: The integration of blockchain technology into VIM systems can ensure secure, transparent, and immutable recording of transactions. This innovation can significantly improve data integrity, traceability, and compliance within healthcare supply chains.
  3. Internet of Things (IoT) Integration: The use of IoT devices, such as RFID tags and sensors, will become more prevalent. These devices can provide real-time tracking and monitoring of inventory, ensuring better visibility and reducing the risk of errors or stock shortages.
  4. Enhanced Data Analytics: Advanced analytics tools and predictive modeling will evolve, allowing for more accurate demand forecasting, optimization of logistics, and proactive decision-making based on comprehensive data analysis.

Predictions and future advancements in VIM implementation and utilization:

  1. Greater Adoption and Integration: Future trends suggest increased adoption of VIM across healthcare organizations, from large hospitals to smaller clinics. VIM’s role will expand beyond inventory management, integrating with electronic health records (EHR) systems and other healthcare technologies.
  2. Interoperability and Standardization: Efforts toward interoperability and standardization of VIM systems will intensify, aiming to ensure seamless communication and data exchange between different healthcare facilities, suppliers, and systems.
  3. Customization and Scalability: VIM solutions will become more customizable and scalable to accommodate diverse healthcare settings and specific needs, allowing for tailored implementations that suit various organizational structures and requirements.


The implementation of Virtual Item Master (VIM) systems in healthcare supply chain management has proven instrumental in revolutionizing the industry. VIMs offer consolidated and accurate data, streamlining inventory management, optimizing procurement, enhancing operational efficiency, and ultimately contributing to cost savings and improved patient care.

Looking ahead, the transformative potential of VIM in healthcare is immense. It is not merely a tool for better inventory management but a catalyst for broader improvements in healthcare operations. As technological advancements continue, the integration and evolution of VIM systems will play a pivotal role in shaping a more efficient, transparent, and patient-centric healthcare ecosystem, ultimately improving outcomes and advancing the quality of care for patients worldwide.

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