Magazine Article | July 16, 2008

Discover Healthcare Bar Coding Opportunities

Serving the asset tracking needs of the healthcare industry is helping this integrator reach 20% revenue growth.

Business Solutions, August 2008

Tom Jackson (left), VP of sales for Integrated Barcode Technology (with Kevin Holmboe, director of software development) If you're not targeting the healthcare industry for your bar code solutions, you might be missing a huge opportunity. A 2008 survey by healthcare publication Modern Healthcare shows that 58% of healthcare executives cite the adoption of an EHR (electronic health records) system as one of their top three IT priorities this year. Your data collection solutions are integral in creating such systems.

Integrated Barcode Technology (IBT), a division of Astron Wireless Technologies, is an integrator that's found particular success creating solutions for the healthcare market. The integrator's definition of the healthcare market includes any entity that caters to the recipient (i.e. patient) of health services (e.g. nursing homes, hospitals, home care). Tom Jackson, VP of sales for IBT, says that VARs can make money by creating solutions that help healthcare providers track assets and automate processes. The benefit to healthcare providers is being able to deliver safe and effective patient care. For IBT, the benefit of offering these solutions has been monetary. Indeed, the integrator expects to achieve 20% revenue growth in 2008, in large part due to its work in the healthcare vertical.

Use Bar Codes To Track Healthcare Assets
To track assets, IBT has created its own software called ATRACK. The Windows-based software uses handheld bar code scanners and bar code labels to give organizations the ability to capture data pertaining to the organization's assets. "Of particular importance to healthcare providers is the ability to track assets that are mobile within a hospital [e.g. IV pumps, respirators, EKGs]," says Kevin Holmboe, IBT's director of software development. Why? Not surprisingly (but somewhat disturbingly), he says that due to the large size of many care facilities and the large quantity of equipment, hospitals often lose track of equipment. Lost equipment translates to lost time spent searching, as well as a reduction in the quality of patient care.

In addition, healthcare providers can benefit from being able to keep a maintenance history on assets. For example, IV pumps have filters and belts in them which require regular servicing and checkups. "You can imagine that if a piece of equipment fails during an operation or while in patient care, the healthcare provider could face a huge liability," explains Holmboe. "Thanks to the litigious climate of the United States, this is a pain point that all healthcare providers are keen to solve." Using bar codes, healthcare providers can track where a piece of equipment originated, when it was purchased, and who's responsible for upkeep, cost, and more. In most cases, Holmboe explains, IBT sells ATRACK as a turnkey solution and not as a networked piece of software. He explains that healthcare facilities usually have one person dedicated to the tracking process. Whether or not you have the capabilities and desire to create your own asset tracking software, there are numerous solutions already out there ready for you to resell.

In addition to hardware and software, a major component of IBT's asset tracking solution is consultation. "It's important that you work closely with a healthcare facility to create new workflow processes [i.e. scanning the asset during various points in a process], so these organizations can track the location of assets as well as log a history of maintenance," says Jackson. In fact, even Jackson's 20 years of healthcare experience often isn't enough to create a solution without proper research into the customer's workflow. "Sure, we know 95% of what a customer is doing before we go in. It's the other 5% we need to uncover before we can create an appropriate solution," he says. Obviously, uncovering such information can only be done on-site. "Even though there are a host of Web tools available today that allow you to virtually work with a customer's computer and organization, you need to get physically involved to solve a lot of the problems in this vertical," Holmboe interjects.

More Info Read To see how another VAR is succeeding in the healthcare vertical, visit

Cash In On Bar Code Media Residuals
When tracking assets in a healthcare facility, it's important to select the correct type of bar code label media. In most cases, IBT recommends a 5-mil polyester label with a high-tac permanent adhesive and a topcoat laminate. Put simply, this is a durable, chemical-resistant label that isn't easily removed. Jackson says that to put a topcoat laminate on a label requires an expensive printer. Rather than recommend the customer pay for such a printer, IBT partners with such companies as Repacorp Label Products, who specialize in printing bar code and RFID (radio frequency identification) labels. Typically, IBT sells its customers preprinted rolls of labels costing about 2.5 cents each.

In addition to durability, security is a huge concern in the healthcare space. Therefore, IBT also sells labels with embedded void panagraphs (hidden text or an image that appears when a label is tampered with). Jackson estimates that 75% of his customers use labels with embedded void panagraphs.

While buying media through IBT saves the customer from a one-time purchase of specialized printers, it also positions IBT to earn a significant amount of recurring revenue via the sale of consumables. "Selling labels, printheads, parts, and ribbons amounts to more than 30% of our annual revenue," reveals Jackson.

Tie Collected Bar Code Data To Patient Records
Aside from asset tracking solutions, IBT also specializes in creating front end software that interfaces with a healthcare facility's ERP (enterprise resource planning) automation system. These solutions are designed to run from COWs (computers on wheels, or carts containing wireless PCs) in facilities such as hospitals. Nurses commonly dispense medicine from COWs and can scan bar codes to collect data pertaining to patients and the medicines being received. The result is that hospitals can deliver a higher and safer level of patient care. Indeed, with wireless mobile connectivity to various hospital databases, caregivers can use bar codes to verify that the correct person in the correct room is getting the correct medicine at the correct time. In addition, by connecting to food service department databases, the hospital also can track what food a patient is eating and any effects the food might have on the medicines being taken.

Jackson also says that IBT has hospitals interested in tracking what occurs in operating rooms (ORs), tying the medical equipment used in the OR during an operation back to the patient's electronic record. "Every year, it seems like there is more government interaction with healthcare," says Jackson. "Healthcare facilities are looking for 'cover your butt' solutions that can help meet the onslaught of requirements imposed by Medicare, Medicaid, HIPAA [Health Insurance Portability and Accountability Act], the FDA [Food and Drug Administration], and the FCC [Federal Communications Commission]." And again, due to the number of lawsuits surrounding malpractice, healthcare providers have a powerful incentive to be looking for solutions that can reduce potential mistakes.

While perfect for minimizing mistakes, automation also can lead to efficiency gains and an attractive ROI. One of IBT's first automation success stories came from a large pharmaceutical chain customer. "After we completed an analysis of how the customer was dispensing drugs in each of its 125 locations, we created an automation solution that saved the chain $800,000 in the first year."

Whether selling asset tracking or automation solutions, Jackson says that identifying one decision maker in this market isn't likely. In fact, many healthcare facilities have buying groups composed of many people from different departments within the healthcare organization. The buyer's group typically acts as a gatekeeper.

Rather than trying to walk in off the street and offer solutions, Jackson recommends VARs look for partners already doing business with the organization. For example, IBT partnered with a manufacturer of surgical instruments, helping to create a software product that inventories instruments being included within a sterile package ready for an operation. Today, the surgical instrument manufacturer uses IBT to perform the software integration in hospitals. "After we automate the sterile processing departments, we then try to uncover other areas where we can offer our full complement of solutions," says Jackson. "Since the facilities are familiar with our work, it's much easier to pitch new solutions." In addition, satisfied customers in one facility often share success stories with others. Amazingly, when looking back over the past 18 years, Jackson and Holmboe can attribute 90% of IBT's business to referrals. With a referral rate like that, you might find cold calling a thing of the past.

Perhaps Jackson and Holmboe paint too rosy a picture. Obviously, the duo's 20 years of healthcare experience gives IBT a significant competitive advantage. Still, with the tens of thousands of healthcare facilities in the United States, it's not unreasonable to think that you could be the one to offer the next best bar coding solution.