By
using data to target inefficiencies, leading healthcare systems are proving
technology’s potential to revolutionize care delivery.
More than a year after the Affordable Care Act
was passed, it is clear that a sweeping policy change will not be enough to
repair the U.S. healthcare system. As an industrialist in the healthcare
business, I can see that the fundamental driver of high costs and quality
issues is the inconsistency of healthcare delivery and outcomes from region to
region, state to state, and even hospital to hospital. Such variance is evil:
It is bad for your health, it is bad for your local doctor’s business, and it
is bad for the healthcare system as a whole. But I also know that the part of
the business perceived as less exciting — process and information technology —
can drive revolutionary change.
The good news is that certain pioneering
institutions are already using IT and process engineering to reduce costs and
improve health outcomes. They approach healthcare as a science, not as an art.
They’ve used data to target areas of underperformance and waste, and they’ve
employed technology to transform their systems. Their solutions can serve as
best practices for patients and businesses alike. (Disclosure: GE makes some of
the technologies used by these companies.)
Virtua, a comprehensive multi-hospital system
based in southern New Jersey, is considered one of the best-performing
hospitals in the nation — both clinically and financially. Its leaders
accomplished this by using data to understand performance and drive day-to-day
process improvements while expanding their technology capabilities at the
system’s nine locations. Virtua has seen many changes system-wide, ranging from
improving staff scheduling to decreasing by two-thirds the amount of time it takes
to treat a woman who discovers a lump in her breast. As a hospital system that
generates in excess of US$1 billion in annual revenue, Virtua has been able to
save $23 million in unnecessary costs since incorporating Six Sigma as a
process improvement tool.
Virginia’s Bon Secours Richmond Health System,
which recently announced a data-rich “no-wait emergency room,” has also saved
$5 million through technology that enabled the organization to eliminate
unnecessary spending on equipment; the health system now deploys 30 percent
fewer intravenous pumps alone. And with the use of technology and a strong
governance structure, the system estimates that its 20-minute reduction in
overall surgical procedure time could expand access to more than 500 additional
patients per year.
The Tampa, Fla.–based H. Lee Moffitt Cancer
Center and Research Institute, one of the leading cancer centers in the United
States, used sophisticated computer modeling to reconfigure its surgical block
schedule, freeing up capacity for 900 additional cancer procedures a year
without adding operating rooms or hours. That new capacity improves access for
patients (up to 12 percent more medical procedures can be performed) and makes
good business sense (about an $8 million annual margin for the center).
Sometimes less is more. At Boston’s Brigham
and Women’s Hospital, GE is supporting efforts to ensure more appropriate
imaging. Software that aggregates decades of evidence-based medical best
practices provides diagnostic options based on historical effectiveness and
patient history. It may seem counterintuitive for a medical device manufacturer
to recommend fewer tests, but this kind of effort has the potential to curb the
number of unnecessary imaging tests given at hospitals and outpatient clinics
around the world. If you understand variance, you know it goes both ways: For
every unnecessary scan out there, somebody who needs one is not getting it.
Those undiagnosed patients will inevitably cost more to treat down the road.
Managing variance will improve healthcare quality and lower costs at the same
time.
These institutions are at the vanguard of
healthcare reform, harnessing data in practical ways to breathe new life into
the existing system. It’s time to focus on solutions and employ the data,
processes, and technologies available today to give doctors, nurses, and all
other healthcare providers the best environment in which to perform. We know
from extensive industrial experience that total dedication to efficiency will
pay off in terms of improved quality, enhanced customer experience, greater
patient safety, and reduced costs. Thoughtful leaders will become the heroes of
healthcare reform by following the same formula.
John Dineen
Strategy + Business
Business & Investment Opportunities
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