How Texas Children’s Hospital Revolutionized Medication Management

The $40 Million Challenge

Texas Children’s Hospital, Houston’s premier pediatric health system, faced a staggering challenge with their $440 million annual medication budget. Their pharmacy team uncovered an alarming $40 million loss attributed to drug expirations, wastage, and diversion issues.

Identifying the Root Cause

Gee Mathen, Director of Pharmacy Clinical Applications and Technical Services, alongside Craig Lane, Manager of Application and Technical Services, conducted an extensive analysis of their inventory workflows. Their investigation revealed that multiple human touchpoints were the primary source of tracking difficulties.

The High Stakes of Medication Management

Beyond the financial impact, the team recognized that inefficient tracking created vulnerabilities for drug diversion. High-value medications, not just controlled substances, were particularly susceptible to theft, emphasizing the need for a robust tracking system.

Implementing Cutting-Edge RFID Technology

Building on their existing RFID experience with drug kits and trays, the team developed a specialized system focusing on 784 high-value specialty drugs costing $100+ per unit. The new process dramatically simplified medication tracking through innovative technology.

Streamlined Two-Step Workflow

The revolutionary system reduced a complex 12-step process to just two efficient steps:

1. Scanning drugs to generate validated labels
2. Applying RFID tags at a conditioning station

Real-Time Tracking and Accountability

The new system provides:

• Instant visibility of medication inventory across facilities
• Staff accountability through ID-tracked access
• Automated daily inventory management
• Significant reduction in unnecessary ordering

Measurable Results and Future Applications

The implementation has already demonstrated success:

• $50,000 savings at one satellite location
• Reduced staff time in tagging and data entry
• Enhanced ability to investigate potential diversion
• Plans for expansion to controlled substances management