How Engineering Principles Can Improve Healthcare

August 18 01:00 2014 by ushadmin

Here’s a typical day at many hospitals: In the boardroom, the executive team considers how to bring in more patients because the insurers are squeezing prices and competitors are ramping up advertising. On the hospital floor, physicians and nurses rush from procedure to procedure, seemingly without enough hours in their day. Meanwhile, patients sit in the waiting room, growing frustrated (and those calling the hospital sit on hold), even as exam rooms are empty and multimillion-dollar equipment sits idle. What’s going on here?

The issue has to do with the utilization of clinicians, staff, and assets—a problem that’s only going to get worse. Aging populations, the rising incidence of chronic disease, and healthcare reform are leading to a growing demand for care, particularly specialty healthcare such as obstetrics and gynecology, pediatrics, neurology, cardiology, and oncology. Although many of those treatments require inpatient stays, there is a real opportunity to deliver some aspects of specialty care via outpatient clinics and departments within hospitals. Yet in our experience, many such clinics are extremely inefficient in the way they deploy their staff and use their facilities to meet the demand for care. The influx of newly insured patients, combined with the projected shortage of newly qualified clinicians, will only compound this problem.

The solution, we believe, is for specialty outpatient care clinics and departments to better use their current facilities in order to improve access to care. More specifically, hospitals and health systems should apply the proven principles of industrial engineering, through four specific levers.

1. Demand and operations planning. Many specialty outpatient clinics use some kind of demand planning, yet it is often ad hoc and infrequent (typically once or twice a year), and based on benchmark staffing ratios. This is a reactive approach, and akin to driving by looking only in the rearview mirror. Instead, clinics could implement more real-time tracking tools to continuously assess demand levels and better predict surges. Many administrators think they need to buy complex and expensive workforce management systems, but a basic spreadsheet program such as Excel is often good enough to realize the first set of improvements. In addition, clinics shouldn’t rely on external benchmarks or generic staffing ratios but instead develop these parameters based on clinic- or department-specific demand. The goal in this first step is to get a more accurate and up-to-date assessment of demand, on a daily or even hourly basis.

A metric that clinics can use to gauge their performance in demand and operations planning is the percentage of total payroll that is allocated to overtime, or to third-party agencies that provide short-term staff to fill in gaps. High levels in both—combined with periods of low staff utilization—may indicate that the facility is not matching supply to demand dynamically.

2. Talent management. Whereas the first lever looks at the volumes, the second looks at the nature of the services—namely, the current qualifications and training levels of clinic staff. Again, many facilities have some kind of talent management program in place, but it’s administered infrequently, and the responsibilities of team members at different levels tend to blur.

Using a more systematic approach will ensure that the clinic has the right people in the right roles, and that they’re performing at the top of their current qualification level and job description. A key component of managing talent is ongoing training and testing, including clinical refreshers, for staff at all levels. The goal should be to assign tasks according to the education level, expense, and revenue-generation potential of each team member. The result is not only a more efficient operation but a better experience for patients and staff.