The Importance of Being Focused. And Earnest.
To improve the healthcare value…
That is, provide the very best possible care for the dollar spent ” hospitals and healthcare systems must have baseline measures of cost, quality and value. In addition, they need to compare their performance on these parameters against other hospitals in their market and across the nation.
A fully integrated set of analytics and tools to help organizations move the needle toward real and sustained cost performance is necessary. This requires providing a quantifiable picture of how much to improve (a goal); what to improve (focus); how others do it (benchmarking & networking); and ongoing monitoring of performance.
Where’s the 20%?
Hospitals and healthcare systems put a lot of effort into cost reduction strategies, inflict a lot of angst on managers, without delivering sustainable results. Why? Too often hospitals employ one of these low ROI strategies that lead to much frustration and not much improvement:
- Across the board cuts; each department must reduce by a given percentage
- Target the biggest spenders for cost reduction
Our approach is different. iVantage applies a standard comparative methodology to all hospitals using readily available cost reports combined with public data to uncover a unique improvement profile for each hospital. The unique improvement profile shows which areas have the biggest cost and quality opportunities – it’s the 20% of areas that cause 80% of the cost excesses or quality issues. That means hospitals can build an improvement plan that addresses their specific issues.
Actual data from three blinded hospitals in theTM PDF download above demonstrates the uniqueness of a hospital’s cost profile and how pathways to strategic cost reduction or quality improvement vary across hospitals. And yet, even though the excess cost areas vary, the 80/20 rule (80% of the problem is in 20% of the departments) applies. This is good news for hospitals serious about improvement ” no longer do they have to endure the frustration of an enterprise-wide cost reduction program of dubious value.