Bend the Cost Curve and Eliminate Waste

by Webmaster, PhoenixMed
Published on Aug 31, 2016

Our healthcare system is economically unsustainable. As reform continues to spread, pay for value rather than volume of services has taken center stage within CMS and commercial payers. But closing the gap between cost and value will require greater engagement of all hospital clinicians to address current delivery of care processes and the resources that are used to support and provide high quality care.


According to Maureen Bisognano, former CEO of the Institute of Healthcare Improvement, roughly 3% of every hosptial operating budget is waste.  She cites several primary categories which fit nicely into the hospital care manager's (HCM)  role in monitoring progression-of-care.:

  1. Delays - HCMs regularly encounter obstacles that impede the progression-of-care, From incorrect demographic information that delays authorizations and transitions to family indicision about a patient's treatment plan; from lack of communication between consulting physicians to test scheduling.  Each of these scenarios impede timely progression of care, increase the costs of care, and add avoidable risk.
  2. Rework - UR specialists can relate to this one!  When the executive team fails to see the value of robust gate-keeping at the point of entry, it is usually the UR specialist who has to 'fix' the resulting errors that are made about level of care, the omissions in medical necessity documentation, or the rebilling of claims.
  3. Overproductiion - could also be categorized as "Overtreated," the title of Shannon Brownlee's marvelous book which delves into the complex reasons that unnecessary care accounts for as much as a third of health care spending. It also explains why all that unnecessdary care is not just a waste of money but is also harming patients.  Overproduction can also describe the wide variations in care.  It is well known that physicians practice medicine in significantly different ways across different parts of the country. Unless physicians apply evidence based practices to traditionally high cost cases, hospital execs won't achieve that much to improve the value of care as a whole.   
  4. Movement - Unnecessary transport,, moving patients from unit to unit, and obtaining supplies, products or information. Included in this category is the enormous waste of time spent by hospitalists running from floor to floor to see patients. Twenty years ago when Bob Wachter described the emergence of this new type of specialist, their numbers have grown from a few hundred to more than 50,000.  Approximately 75% of US hospitals now have hospitalist but with this growth there have been challenges.  One of them is the amount of 'travel time' hospitalists accumulate racing from one unit to another to see patients. Regionalization of patient care, access to more bedside services (ultrasound for procedures and diagnosis), and accountable care units with unit based leadership teams will be the next 'big' thing as hospitalists assume greater responsibilities for acute medical care.   
  5. Defects - All the things that can go wrong in a hospital:  medication errors, hospital acquired infections, falls, etc.  A recent study cited hospital errors as the third leading cause of death in the US claiming 251,000 lives every year. 
  6. Waste of spirit and skill.  This is the category of greatest interest to a hospital case management leader.  Operational inertia, faulty processes, and all the extraneous activities needed to 'get something done' wastes time and demoralizes even the most motivated team member.. 

Given the continued financial pressures hospital face, there needs to be executive support to find ways to reduce waste.  HCMs, working in partnership with the physician and care team are perfectly positioned to pro-actively advocate for the patient, the community and the physician by questioning these wasteful activities.