Everyone is searching for a way to contain healthcare costs. However, quality of patient care, population health management, and patient satisfaction are integral parts of healthcare reform. Organizations have to balance cost containment strategies with these complex requirements for better care. Current cost containment strategies are too inefficient to keep up with the reform’s robust changes, and unnecessary internal expenses often go unnoticed. Organizations need sophisticated solutions to help identify and manage their costs without adversely affecting quality of care.
Quality of care does not have to be sacrificed in order to effectively contain costs. Healthcare organizations are starting to embrace data mining and advanced analytics on their existing data to combat costs. With data-driven solutions, healthcare leaders are able to make decisions based on critical quality, operational, and cost information. Leaders are investing in analytics solutions to enable more effective cost containment strategies.
Lean and Six Sigma
Lean and six sigma are business management strategies used to drive operational excellence and decrease costs within organizations. Their application in healthcare allows organizations to provide cost-effective, high-quality care by reducing variation and eliminating waste. Lean and six sigma projects need accurate data to identify areas of opportunity and monitor processes over time. However, this can be a very cumbersome, time-consuming and often error prone process. Analytics software provides easy, timely, and accurate sharing and accessibility to information required to drive process change. Together, they can be utilized to improve and control costs in an easier and more effective manner.
Advanced analytics tools enable organizations to visualize and track key metrics, such as probability of defect, sigma values, and distributions. Process improvement projects, based on lean and six sigma or ogher principles, can be implemented more easily, quickly, and effectively with the aid of advanced analytics tools.
Cutting Direct Costs
There is a growing realization that organizations do not have insight into what customers or services they are actually losing money on. Revenue is often tracked, but organizations are limited in scope and currently lack high-quality cost information. One of the most significant obstacles to both cost containment and quality of care maintenance is the absence of accessible, accurate, and thorough analyses of products or service costs.
The key to achieving full visibility of cost information is the ability to understand information from clinical, operational, and financial data. Advanced analytics solutions provide hidden insights into:
• Cost-per-test analyses
• Supply and operational expenses
• Revenue versus profit generation
These tools are able to aggregate data from multiple disparate sources to provide cost analyses from multiple perspectives. The insight across a wide breadth of departments, as well as the ability to drill down into the details of individual cases, allows for full visibility and cost reductions.
Preventing Unnecessary Costs
Cost containment commonly focuses on cutting short-term, unnecessary expenditures. However, it is equally as important to improve long-term costs, such as staffing inefficiencies and processing errors. Here are a couple of examples:
- As employees retire and leave, hiring new personnel is general practice. However, the costs associated with locating, hiring, and training new staff are high. Healthcare organizations can reduce costs by simply reallocating staff efficiently when employees retire. With insightful resource analytics based on predictive volume, workload, and productivity data, organizations can reallocate their existing staff more effectively, rather than hiring to perpetuate the overstaffing and additional costs.
- Nosocomial infection outbreaks add enormous burden to hospital resources. The long-term costs due to hospital-acquired infections include increased treatments, delayed patient discharge, and poor patient satisfaction. Analytics solutions help track infection population details such as, effected patients, location of outbreak, and microbial tests used to diagnose the infection. Hospital administrators are able to report back information to concerned constituents and provide factors that may correlate to the causes of infection. Managers can perform predictive analytics with tracking information to prevent future outbreaks quicker and protect patients more efficiently.
Investment in sophisticated analytics solutions is necessary to contain costs and meet increasingly stringent reform requirements, without compromising patient satisfaction. To learn more about how Viewics can help, download our eBook, Strategic Planning for Laboratories.