HA 695 Unit 5 costed business case example

Cards First, Then the Hold List: A Costed Business Case Comparing Three Ways to Cut Operating Room Supply Waste, Including Doing Nothing

Student Name

Health Care Administration, Herzing University

HA 695: Graduate Capstone Project

Instructor Name

February 12, 2026

Cards First, Then the Hold List: A Costed Business Case Comparing Three Ways to Cut Operating Room Supply Waste, Including Doing Nothing

The Decision

Ridgeway Medical Center's main operating room discards about $1.62 million a year of disposable supplies opened but not used, $182 per case. The current state analysis set an evidence-supported target of one-third less, about $121 per case, a gap of about $543,000 a year. This case asks the vice president of perioperative services and the chief financial officer to choose among three options.

The Options

Option 1, change nothing. Cards stay as they are, staff keep opening everything on the card, and waste continues at about $1.62 million a year, rising with supply prices.

Option 2, card cleanup. The perioperative nurse educator meets with each of the 12 highest-waste surgeons to review the cards for their highest-volume procedures, about 80 cards, removing items the surgeon rarely uses or moving them to available-on-request. The information systems analyst purges the 214 cards of surgeons who no longer operate at Ridgeway. Cards are reviewed each year after that.

Option 3, the combined program. Everything in Option 2, plus a hold list of about 15 high-cost items that are kept in the room unopened until the surgeon asks for them, excluding anything that must be instantly available in an emergency; cost shown on every preference card; and a monthly scorecard sent privately to each surgeon showing waste per case for their procedures against their own baseline and the service median.

Criteria and Weights, Set Before Scoring

The sponsors agreed the criteria and weights on January 30, before any option was scored. Net annual savings, 40%: the recurring saving after recurring costs. Risk of delay or safety events, 25%: how likely the option is to cause an item to be unavailable when needed. Surgeon acceptance, 20%: whether surgeons are likely to support it, based on the chair of surgery's view and early interviews. Implementation burden, 15%: staff and information systems time required. Each option receives a score from 1 to 5 on each criterion, with 5 the most favorable, and the score's basis is stated below.

Costs by Category

Costs are kept in categories, with the source of each figure.

Expected Savings

Option 2: based on the 20% reduction in supply cost per case found after preference card standardization in one published study (Avansino et al., 2013), applied here to waste rather than to total supply cost and discounted for partial surgeon participation, about 18% of waste, or $291,000 a year at full effect. Option 3: the one-third target from the current state analysis, $543,000 a year at full effect, supported by the card evidence and by a controlled study in which monthly cost feedback to surgeons was followed by an adjusted drop of roughly a tenth in supply spending (Zygourakis et al., 2017). Year one assumes 60% of full effect for Option 3, since the hold list and scorecards start in month four.

Net result, year one: Option 2 saves about $281,000 after costs; Option 3 saves about $288,000. At full effect from year two: Option 2 about $288,000 a year; Option 3 about $520,000 a year. Option 1 saves nothing and costs about $1.62 million a year in waste, a figure that will rise if supply prices rise.

Comparison

Weighted scores: Option 1 scores 3.40 (savings 1, risk 5, acceptance 5, burden 5); Option 2 scores 3.85 (savings 3, risk 5, acceptance 4, burden 4); Option 3 scores 3.90 (savings 5, risk 4, acceptance 3, burden 2). Option 3 ranks first by a narrow margin. If the risk criterion were weighted 30% and savings 30%, Option 2 would rank first at 4.00 against 3.70, so the choice depends on how much the sponsors fear delays from the hold list. That sensitivity shapes the recommendation.

Recommendation

Adopt Option 3, implemented in sequence: card cleanup first, then the hold list and scorecards. The sequence captures Option 2's low-risk savings immediately while the hold list is designed with surgeons and nursing, and it lets the sponsors stop at Option 2 if the hold list test shows delays. The recommendation rests on the larger recurring savings, about $232,000 a year more than Option 2 from year two, at a recurring cost of under $23,000.

Sequence, owners and dates. Months 1 to 3: card reviews with the 12 highest-waste surgeons and purge of inactive cards; owners, perioperative nurse educator and information systems analyst. Month 3: cost display on cards and first scorecards; owner, supply analyst. Month 4: hold list tested in two orthopedic rooms for four weeks, with every retrieval time recorded; owner, perioperative nurse manager. Month 5: hold list extended to all rooms if no retrieval delayed a case by more than two minutes. Month 6: first full evaluation.

Risks. Surgeon resistance to scorecards, addressed by sending them privately and comparing each surgeon with their own baseline first; information systems delays, addressed by the vice president's sponsorship of the requests; and a delay caused by a held item, addressed by the test design and by excluding emergency items from the list. Surgeons' limited knowledge of supply costs (Okike et al., 2014) is the reason cost display is part of the design rather than an afterthought.

References

Avansino, J. R., Goldin, A. B., Risley, R., Waldhausen, J. H. T., & Sawin, R. S. (2013). Standardization of operative equipment reduces cost. Journal of Pediatric Surgery, 48(9), 1843-1849. https://doi.org/10.1016/j.jpedsurg.2012.11.045

Okike, K., O'Toole, R. V., Pollak, A. N., Bishop, J. A., McAndrew, C. M., Mehta, S., Cross, W. W., III, Garrigues, G. E., Harris, M. B., & Lebrun, C. T. (2014). Survey finds few orthopedic surgeons know the costs of the devices they implant. Health Affairs, 33(1), 103-109. https://doi.org/10.1377/hlthaff.2013.0453

Zygourakis, C. C., Valencia, V., Moriates, C., Boscardin, C. K., Catschegn, S., Rajkomar, A., Bozic, K. J., Soo Hoo, K., Goldberg, A. N., Pitts, L., Lawton, M. T., Dudley, R. A., & Gonzales, R. (2017). Association between surgeon scorecard use and operating room costs. JAMA Surgery, 152(3), 284-291. https://doi.org/10.1001/jamasurg.2016.4674