As the healthcare industry shifts from fee-for-service to fee-for-value, providers need to refocus and learn new skills to thrive in the value-based care paradigm. We are committed to working with our clients to assist them in making a successful journey into clinical transformation. We offer the following services:
- Service line optimization
- Practice assessments and improvement
- Clinical variation optimization
- Implementation of value-based and quality payment programs
Case Study: Scorecards Help Reduce Clinical Variation, Resulting in $2 Million Boost to Acute Care Hospital’s Bottom Line
By: John Malone
An acute-care general hospital in the Northeast was already delivering double-digit operating margins, but in the sprit of continuous improvement and moving from “good to great,” hospital leadership knew it could do better.
Two primary areas of focus were length of stay and resource consumption of its top 16 private admitters. Excess days per discharge were nearly 1.5 days for this group, and their average cost per case was increasing at an annual rate above the hospital average.
We committed to work with this group of physicians to analyze clinical data, identify opportunities for improvement, and create physician scorecards and education to support changes in clinical behavior. Physicians attended quarterly group and one-on-one education sessions to review customized clinical analytics, as well as physician scorecards.
By showing monthly progress against targets, these scorecards provided data transparency that encouraged peer comparison, friendly competition, and marked improvement. In addition to detailed data about resource consumption, key metrics included excess days per discharge, 30-day readmission rates, and mortality rates.
For about 18 months, we worked directly with the 16 top private admitters to reduce length of stay and unnecessary resource consumption, achieving a $2 million improvement to the bottom line.
Year-over-year average cost per discharge improved 6 percent for this group of physicians, whose average length of stay also dropped by 0.7 days. During the project, the community hospital was ranked first in its state for healthcare value and was also ranked No. 23 in the country for the same metric.
Order sets for pneumonia, heart failure, septicemia, and AMI were modified to reflect desired changes in ordering patterns based on the physician’s internal best practices as revealed by customized data analytics.
In addition, financial and operational baselines were established, and monthly progress by physician was measured and documented to validate achieved savings. Medical staff and administrative leadership committed to maintaining the measurement and scorecard processes to monitor and improve outcomes on an ongoing basis.
John Malone, principal for Lumina Health Partners, helps healthcare providers implement transformational change using state-of-the-art clinical analytics combined with best practices in clinical redesign and organizational change. He emphasizes reducing clinical variation, which is the last frontier of hospital performance improvement.
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