Spiraling healthcare costs and growing concern over the quality of patient care are topics of intense focus across the industry. One key to improving quality and reducing cost lies in monitoring, analyzing and reducing variability that does not add value. These capabilities are critical now, and will become even more so as the industry continues to change. As new reimbursement models are introduced that incent reduced resource use and improved outcomes, organizations will have no choice but to take a more disciplined approach to this task.
Introducing more consistency into patient care doesn’t imply the elimination of clinical judgment, or a "one-size-fits-all" approach. Rather, it entails the integration of evidence-based medicine with analysis and identification of those decisions/practices that incur costs without demonstrable payoff. This requires that management work collaboratively with clinical staff to identify those factors with the greatest impact on quality and cost.
Are you ready to face a new competitive landscape?
This change in focus across the industry presents a threat to provider organizations wedded to traditional business practices that treat care delivery as a craft undertaking that defies measurement. By the same token, measurement can be overdone, also with negative consequences. If your organization is prepared with the necessary capabilities and infrastructure, changing cost and quality requirements may actually be an opportunity to differentiate yourself in the marketplace.
Just because you can measure it, doesn't mean you can manage it
Undertaking a structured approach to variability reduction involves a number of challenges and critical decisions. For example, sometimes less is more — some organizations collect data on too many metrics, leaving managers drowning in data but starving for information. This can lead to trouble identifying target opportunities for improvement, and "analysis paralysis."
It's no easy feat for organizations to identify the best opportunities for reducing cost and quality variability and to measure their progress. Unfortunately, doing so is just half the battle. Organizations that are able to effectively measure variability still need to take action to minimize it to be successful. Leadership faces procedural, operational, financial and cultural barriers as part of the challenge of implementing change. Even organizations that have plans in place to reduce variability may find that internal resistance (e.g., from physicians or other stakeholders) can keep them from achieving their goals.
Despite the challenges that you will face, reducing variability in cost and quality will be imperative to the success of your organization moving forward.
Minimize variability by measuring, monitoring and managing cost and quality
There are a number of steps you can take to ensure your progress on the path to managing variability in a way that will enable you to effectively meet growing demands for better quality at lower cost.
Step #1: Develop and implement predictive care paths
Without standard processes around clinical decision-making, organizations are left with each individual's interpretation of best practices — and rampant variability is almost guaranteed.
Predictive care paths and corresponding treatment protocols are fundamental to reducing variability. Predictive care paths are evidence-based roadmaps of best practices that yield superior clinical outcomes. Any given service line may include multiple related predictive care paths which will serve as a baseline for managing cost and quality variability and provide guidance that everyone can follow. Defining these practice regimens based on evidence bolsters their credibility and encourages buy-in of physicians who may otherwise be skeptical of their implementation.
Step #2: Develop management tools to quantify variability as a step toward reducing it
Variability must be measured against predictive care paths for a given patient's experience. In order to do so, organizations will need to identify metrics for measuring divergence from predictive care paths once they are developed and implemented.
Organizations will also need to build the capabilities for effective and efficient data access. Service line leaders often have to rely on other (e.g., quality and finance) functions to retrieve data, often by way of manual data mining and manipulation. Rather than invest in finance and quality manpower to respond to data requests, map specific IT staff to departments within the organization with a responsibility for meeting that department’s needs for data and analysis.
Step #3: Develop the ability to effectively act on and address variability and remember that relationship building is key
First, it's important to address variability in cost and quality separately. Barriers to reducing quality variability are largely rooted in understanding the sources of variability, whereas many of the challenges around improving cost are behavioral and rooted in implementation.
While organizations could feasibly control variability, they sometimes hesitate to look at how individual clinicians impact cost and quality outcomes. Many administrators are uncomfortable with the potential conflict they might face if they ask their physicians, for example, to adopt predictive care paths and take steps to address variability in practice. While organizations may have less trouble getting buy-in from employed physicians, the fear is that, by being among the first to move toward change, they risk losing physician loyalty (and business) to competitors that have yet to come on board.
There are ways to encourage collaboration with your physiciansand other key staff, even if they could just as easily practice through one of your competitors. Creating ways to share your savings with them is one strategy. While monetary rewards are not an option, investment in facilities and access to new technologies or capabilities can be incentives for their support. However, this may not be the most sustainable approach to gaining their buy-in.
The best strategy is to use your relationships with physician groups to encourage them to incrementally modify their behavior in a way that saves your organization money and/or increases quality.
Getting physician practices to develop and adopt their own predictive care paths will result in more physician buy-in than if those pathways were imposed by administration. While a number of quick fixes (e.g., offering incentives or imposing technological controls) may exist, organizations need to understand the value of cultivating the relationships they have with their physicians. These are the true keys to compliance and effectively implementing change.
Dana Hage, MPH, is a business analyst, and Eric Abrams, MBA., is a consultant at Numerof & Associates, Inc. NAI is a strategic management consulting firm focused on organizations in dynamic, rapidly changing industries.
www.nai-consulting.com.
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Introducing more consistency into patient care doesn’t imply the elimination of clinical judgment, or a "one-size-fits-all" approach. Rather, it entails the integration of evidence-based medicine with analysis and identification of those decisions/practices that incur costs without demonstrable payoff. This requires that management work collaboratively with clinical staff to identify those factors with the greatest impact on quality and cost.
Are you ready to face a new competitive landscape?
This change in focus across the industry presents a threat to provider organizations wedded to traditional business practices that treat care delivery as a craft undertaking that defies measurement. By the same token, measurement can be overdone, also with negative consequences. If your organization is prepared with the necessary capabilities and infrastructure, changing cost and quality requirements may actually be an opportunity to differentiate yourself in the marketplace.
Just because you can measure it, doesn't mean you can manage it
Undertaking a structured approach to variability reduction involves a number of challenges and critical decisions. For example, sometimes less is more — some organizations collect data on too many metrics, leaving managers drowning in data but starving for information. This can lead to trouble identifying target opportunities for improvement, and "analysis paralysis."
It's no easy feat for organizations to identify the best opportunities for reducing cost and quality variability and to measure their progress. Unfortunately, doing so is just half the battle. Organizations that are able to effectively measure variability still need to take action to minimize it to be successful. Leadership faces procedural, operational, financial and cultural barriers as part of the challenge of implementing change. Even organizations that have plans in place to reduce variability may find that internal resistance (e.g., from physicians or other stakeholders) can keep them from achieving their goals.
Despite the challenges that you will face, reducing variability in cost and quality will be imperative to the success of your organization moving forward.
Minimize variability by measuring, monitoring and managing cost and quality
There are a number of steps you can take to ensure your progress on the path to managing variability in a way that will enable you to effectively meet growing demands for better quality at lower cost.
Step #1: Develop and implement predictive care paths
Without standard processes around clinical decision-making, organizations are left with each individual's interpretation of best practices — and rampant variability is almost guaranteed.
Predictive care paths and corresponding treatment protocols are fundamental to reducing variability. Predictive care paths are evidence-based roadmaps of best practices that yield superior clinical outcomes. Any given service line may include multiple related predictive care paths which will serve as a baseline for managing cost and quality variability and provide guidance that everyone can follow. Defining these practice regimens based on evidence bolsters their credibility and encourages buy-in of physicians who may otherwise be skeptical of their implementation.
Step #2: Develop management tools to quantify variability as a step toward reducing it
Variability must be measured against predictive care paths for a given patient's experience. In order to do so, organizations will need to identify metrics for measuring divergence from predictive care paths once they are developed and implemented.
Organizations will also need to build the capabilities for effective and efficient data access. Service line leaders often have to rely on other (e.g., quality and finance) functions to retrieve data, often by way of manual data mining and manipulation. Rather than invest in finance and quality manpower to respond to data requests, map specific IT staff to departments within the organization with a responsibility for meeting that department’s needs for data and analysis.
Step #3: Develop the ability to effectively act on and address variability and remember that relationship building is key
First, it's important to address variability in cost and quality separately. Barriers to reducing quality variability are largely rooted in understanding the sources of variability, whereas many of the challenges around improving cost are behavioral and rooted in implementation.
While organizations could feasibly control variability, they sometimes hesitate to look at how individual clinicians impact cost and quality outcomes. Many administrators are uncomfortable with the potential conflict they might face if they ask their physicians, for example, to adopt predictive care paths and take steps to address variability in practice. While organizations may have less trouble getting buy-in from employed physicians, the fear is that, by being among the first to move toward change, they risk losing physician loyalty (and business) to competitors that have yet to come on board.
There are ways to encourage collaboration with your physiciansand other key staff, even if they could just as easily practice through one of your competitors. Creating ways to share your savings with them is one strategy. While monetary rewards are not an option, investment in facilities and access to new technologies or capabilities can be incentives for their support. However, this may not be the most sustainable approach to gaining their buy-in.
The best strategy is to use your relationships with physician groups to encourage them to incrementally modify their behavior in a way that saves your organization money and/or increases quality.
Getting physician practices to develop and adopt their own predictive care paths will result in more physician buy-in than if those pathways were imposed by administration. While a number of quick fixes (e.g., offering incentives or imposing technological controls) may exist, organizations need to understand the value of cultivating the relationships they have with their physicians. These are the true keys to compliance and effectively implementing change.
Dana Hage, MPH, is a business analyst, and Eric Abrams, MBA., is a consultant at Numerof & Associates, Inc. NAI is a strategic management consulting firm focused on organizations in dynamic, rapidly changing industries.
www.nai-consulting.com.
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