As value-based reimbursement becomes reality, hospitals are searching for every opportunity to wring unnecessary costs out of their organizations. Increased emphasis on health care transparency has resulted in re-engineering processes and operations to reduce unacceptable variation and to become more efficient, more standardized and less costly. Of the more than $2 trillion spent annually in the U.S. health care system, studies have shown that as much as half is wasteful spending.
The relentless pursuit to remove variation is well worth the effort. To provide actionable information for health systems, VHA now offers a complimentary monthly webinar series, Strategies to Unleash the Potential in Your Services Lines.
Consider the following targets to reduce variation in your organization.
1. Clinical operations
Variation leads to defects in patient care processes, including medication, testing or procedure errors and adverse surgical events which not only cause patient harm, but also add to the cost of care. A report by the Institute of Medicine estimates the national costs of preventable adverse health care events to be between $8.5 and $14.5 billion annually.
Analyzing an episode of care, using a continuum of care approach, can uncover many opportunities to eliminate variation and significantly improve cost per case. Incorporating Lean methodologies represents one approach to identify and eliminate wasteful, non-value-added components in a work process and improve overall operational efficiencies. A priority focus on improving departmental workflow and patient throughput will provide quick results and high returns.
2. Clinical supplies
Use the most appropriate physician preference items for the right patients at the right time. Competitive pricing is critical, but price alone is not enough to ensure low-cost care. As it pertains to physician preference items, it is equally — if not more important — to understand utilization and build strategies for appropriateness.
Poorly managed pharmacy and clinical supply systems result in wasteful overstocking, outdated medications and cumbersome distribution channels. Manual or complex ordering and distribution processes, and going it alone to negotiate contracts, all contribute to costly waste in the system. Inventory mismanagement weakens the very foundation of an organization’s core operational structure.
3. Clinical quality
Poor communication is noted by the Joint Commission as the No. 1 root cause of sentinel events. Effective communication methodology across the continuum is critical to reduced variation in care delivery, improved costs and, ultimately, patient safety and outcomes.
Reduced variation in care delivery and standardizing transitions of care can have the greatest impact on cost per case. After identifying an unacceptable variation, the care process should be reconfigured to support evidence-based delivery.
Quality documentation improvement across multidisciplinary areas and care settings enhances communication and reporting accuracy and improves reimbursement and overall financial performance.
For health systems to succeed in the value-based reimbursement environment, they must commit to aggressively reducing and eliminating variation to improve cost per case.
To gain actionable insight from VHA subject matter experts, register today for VHA’s complimentary webinar series, “Strategies to Unleash the Potential in Your Services Lines.” These monthly, hour-long programs share solutions for success in today’s health care environment. Space is limited.