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Determining the Economic Order Quantity for Patient Files with Continuous Cost Reduction Programme
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(May 25, 2020)

Estimated share of material costs in hospitals varies from 30% to 40% of total costs. Containment of materials costs therefore has a tremendous potential in making the hospital costs bearable to patients. For keeping inventory cost low, it is necessary to determine Economic Order Quantity (EOQ) and thereby the frequency of Ordering. In this study patient files were selected in the project to determine EOQ.

As per ABC Analysis for the years 2010-11 and 2011-12, it was found that Patient Files have come under “A” Category and was observed that items with high annual value were clinical items, but Patient Files was the only non clinical item that involved high total annual expenses and this anomaly was cause of concern. Patient Files had been under B category in year 2009–2010. The challenge was to determine EOQ for files without compromising the quality and strive to bring patient files from A to B category. This project also emphasizes the importance of ABC analysis.

EOQ was calculated for patient files by applying the Classical Wilson Model resulting in huge savings for the organization as unit cost of file reduced drastically.

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