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Sentara: Performance Improvement

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Reinventing

Reinventing was created in 1995 to:– Reduce annual costs by > $50 M– Help integrate Sentara – Grow the business

14 Internal consultants. Masters Degrees, experienced, “Black Belts” . 2 Nurses, 4 Management Engineers, 3 Finance,

1 EdD, 2 Performance Management, 2 Ancillary Mgrs Purpose has evolved to:

– Reduce Costs– Redesign processes to exploit technology and new facilities

(innovation)

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Reinventing Focus Run the Benchmarking & Productivity Models 10-12 major performance improvement projects each year

– Major project teams are cross divisional

– All team members work on multiple projects:• Lead and support

• Collaborate with each other, other support departments and operations

1 consultant assigned to each hospital Q (Quality of idea) X A (Acceptance) = E (Effectiveness)*

*GE formula for Six Sigma success

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Organizational Structure

R o d H o chm anS N G H

K e N K ra ka urP en in su la

B o b G rav esS V B G H

M P P

M ate r ia ls M gm t

B en chm a rking P rod uc tiv i ty

R e in ve n ting

C lin ica l P e rfo rm an ce

C lin ica l & B us In te l

D o ug T h o m p snD e cis ion S u pp o rt

B e rt R ee seC IO

M ary B lu n tL i fe Ca re

H o wa rd K e rnC o o & P res ide n t

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Performance Improvement Processes Operational benchmarking Productivity Innovation/technology

– Reengineering, simulations, modeling– Process Redesign

Improvement projects– Operational performance improvements– Clinical performance improvements– Outsourcing– Six Sigma

• DMAIC• DMADV• Lean production• Work outs

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1995-2002 Major ProjectsProject Annual savings

Lab Redesign $7.0 M Supply Standardization/Management $4.5 M Registration/Coding $3.2 M LOS Reductions $5.2 M Denial Reductions $1.0 M SHM Improvements $10.1 M SMG/TMG Integration $9.6 M Clinical Engineering Outsourcing $ .8 M Dietary Outsourcing $1.5 M Transcription Outsourcing $.5M Hospitals Benchmarking Improvements $28.6 M

Total $72.0 M

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Benchmarking & Productivity Driven

Performance Improvements

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Improvement Process

Data Reviewed for Top Opportunities Teams formed

Preliminary Assessment by team to COO Work Group

Report on How to get the savings COO work group

Results Hardwired to Budget

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Results Year 1 reduced costs by $12 M Year 2 reduced costs by approx $10 M Year 3 reduced costs by $7 M Success: Environmental Services, Transcription,

Pharmacy, Radiation Oncology, Supplies Misses: Nursing, Medical Records, Patient Accounting Lessons learned:

– Need productivity standards– Need to benchmark FTEs not just dollars

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Why change the focus on improvement & engage

an outside consultant?

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Outstanding Issues to Deal With Increasing pension liability Rising medical malpractice costs Increasing costs of technology:

– Drug Eluting Stents– Implants– Rhythm Devices– Expanding application of Implant Technology

Physician support Changes in reimbursement Shortages of key clinical care givers Cyclical nature of health insurance profitability $900 M investment in new facilities & technology over

5 years

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Two Pronged Approach to Improvement

“Call to action” with management group:– 530 quality ideas submitted– Several ideas already being implemented

Engaged outside consultant: – System wide review– 220 additional ideas– Productivity standards

Create process to prioritize and select projects:– Prioritized combined list of 750+ ideas– Teams and hospitals committed to achieve savings

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Year One Process Hospitals productivity savings/improvement ideas:

– Each hospital assigned a Black Belt to help implement changes • Departmental productivity improvements• Other identified improvement ideas

– First phase of the changes is in 2004 budget– Productivity system being modified to produce bi-weekly reports– Hospital teams are reporting results to COO workgroup

Performance improvement ideas:– Seven system-wide teams are working on improvement projects– Each team has a Black Belt to help implement changes– Progress is being monitored by Operations Committee

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Year Two Process Hospitals:

– Black Belts will help redesign processes to realize savings– Major initiatives include:

• Redesign of Nursing Model• Redesign of Medical Care management• Other Departments who have biggest gap to standards

– Cost center simplification and workload unit standardization System-wide teams:

– Black Belts will help teams implement complex projects– Progress will continue to be monitored by Operations Committee

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Productivity Standard Implementation

25%

35%

40%Reduction of GapActual to Standard

Reduction of GapActual to Standard

2004

2005

2006

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Completed projects as of 9/3/03 Summary of teams’ presentations

Team Estimated Value

Ancillaries $1,260KVPMA 550KNursing 1,300KSMG/WCMG 300KSHM/MCC 15,900KSupplies 700KCorporate 7,671K

Total annualized savings for 2004 $27,681K* (plus one time savings of

$270K)

* There is some duplication between teams’ and hospitals’ completed projects (estimated to be less than 10%)

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Completed projects as of 9/3/03 Summary of hospitals’ presentations

Hospital Estimated Value

SNGH $4,575KSVBGH 1,636KSWCH 4,154KSBH 395KSCH 1,533KSLH 807K

Total annualized savings for 2004 $13,100K* (plus one time 2003 savings of $380K)

* There is some duplication between teams’ and hospitals’ completed projects (estimated to be less than 10%)

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Summary of productivity approach

Lessons learned:– Correcting model/standards has been a huge task– Messengers do get shot– Providing support/help is essential to momentum

Overall:– Results year to date exceed expectations.

• Much accomplished before/during outside consultant’s assessment.

• Perception is the “fear factor” provided motivation.

– Progress is being made and momentum maintained:• $40M in savings identified (more each month)

• Additional savings from productivity changes in budgets

– Many significant improvements (DMAIC/DMADV) will be needed to get to 2005 and 2006 standards

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Why change the focus on Improvement & adopt a Six Sigma approach/culture?

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2002 Six Sigma Activities

Internal consultants needed “updated tools”. Training provided by Juran Institute in 2002. 41 “Green Belts” trained/certified by Juran Institute

– 19 improvement specialists– 20 operational leaders, 2 physician leaders– 8 project teams (2 clinical , 6 operational projects)

21 of the “green belts” became “Black Belts”:– Trained/certified by Juran Institute– 19 improvement specialists– 2 operational leaders

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Six Sigma Projects (2002)DMAIC Ventilator management in GICU (SNGH):

– Reduce LOS by 1 day; saving $.5M to $1M per year

Glucose management of cardiac surgery patients (SNGH):– 73% improvement of glucose levels within desired range

Lab specimen throughput (Reference Lab):– Increased STAT TAT from 48% to 63%

Radiology report availability (SWCH):– Increased reports meeting expectations from 63% to 96%

Central scheduling (SSH):– Improved speed to answer by 44%

Medical care management authorization process (SNGH):– Reduced inappropriate admissions

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Six Sigma Projects (2002 cont.)DMAIC Staffing resource improvements (SLC):

– Reduced annual agency expenditures by $289K (18%)

OR throughput (SCH):– Improved first cases starting time from 24% to 43%

Improved processes at SCH:– Reduced ED throughput time from:

• Fast track: 123 to 85 minutes• Treated and released from 224 to 187 minutes

– Reduced time to schedule radiology appt from 7 days to 1 day – Reduced radiology time for registration complete to report signed

from 14 hours to 3 hours– Reduced average patient registration time from 20 to 15 minutes

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Radiology ResultsSentara Careplex Hospital

Outpatient Diagnostic Exam TAT Comparison

4:06

2:45

2:54

0:03

0:42 0:07

0:00:00

6:06:00

0:00

6:00

12:00

18:00

GE Study, 2001 July, 2003

Ho

ur:

Min

ute

Transcribe Begin - Report Signed

Dictation Begin - Transcribe Begin

Exam End - Dictate Begin

Exam Begin - Exam End

TAT = 14 hours

TAT = 3 hours

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Registration Results Reduced registration cycle time from 20 to 15 minutes Reduced staff by 10% by matching staffing to demand. Revised schedule based on patient arrival patterns:

– Patients arrive 29 minutes (avg) before scheduled appointment– 25% patients arrive 10 minutes or less before appointment

Improved wait time from registration to procedure from 34 Min to 8 Min.

93% agreed that “today’s visit met expectations” Reduced delays in registration

– 50% of delays due to the patient forgetting their script– Standardized script and increased faxing of scripts

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Registration Process Controls

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Six Sigma Projects (2002 cont.)

DMADV Redesigned processes to exploit RIS/PACS Redesigned processes to optimize new facilities

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2003 Six Sigma Activities

Black Belts/Green Belts continue to apply concepts: – SCH Imaging, Registration, Scheduling, ED– SWCH Registration, Scheduling– Seven system-wide performance improvement teams– Several other projects

32 managers selected for 2003 Green Belt training:– Training/certification provided by Juran Institute– Six project teams (2 clinical, 4 operational)– Working with internal Black Belts

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Six Sigma projects (2003)

DMAIC SWCH CHF: Reduce % of patients not achieving expected LOS from

44% to 29%.

SNGH Medical Records: Increase % of midnight paper results on chart by 0630 from 61% to 95%.

SNGH Cardiac Surgery DRGs: Reduce % of patient days greater than expected by 50%.

SHM Claims: Reduce pended claims from 10.5% to 5.25%.

SMHM: Reduce worked hrs per inpatient case from 4.0 to 3.0

SH HR recruitment: Reduce RN fill time from 76.5 to 61.2 days

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2004 Priority Projects (Six Sigma, etc)

Hospitals’ productivity improvements

System-wide performance improvement teams

ED throughput

Six Sigma projects (replicate 2002, identify new projects)

Radiology throughput (exploiting PACs/RIS/Voice)

OR throughput (exploiting surgery/mats mgmnt system)

Physician order entry (exploiting CPOE)

Pre-reg & reg process (exploiting patient tracking)

Patient flow in redesigned hospitals

Outsourcing support processes

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Summary

– Performance improvements is a multi-dimensional challenge which requires multiple approaches.

– Benchmarking is a key ingredient for success.– Productivity standards are critical to achieving and

holding the gains.– Six Sigma (and other performance improvement tools)

are necessary to:• Identify problems, causes and solutions for gaps to

benchmark/productivity standards• Exploit new technology or new facility designs

– All the above are irrelevant without the right team.– All the above are irrelevant without operational ownership.