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WHA Improvement Forum For November    “Building the Business Case for Quality”   PowerPoint PPT Presentation


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WHA Improvement Forum For November    “Building the Business Case for Quality”   Tom Kaster. Courtesy Reminders: Please place your phones on MUTE unless you are speaking (or use *6 on your keypad) Please do not take calls and place the phone on HOLD during the presentation.

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WHA Improvement Forum For November    “Building the Business Case for Quality”  

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  • WHA Improvement Forum

  • For November   

  • “Building the Business Case for Quality”

  •  

  • Tom Kaster

  • Courtesy Reminders:

  • Please place your phones on MUTE unless you are speaking (or use *6 on your keypad)

  • Please do not take calls and place the phone on HOLD during the presentation.


The Value Equation

Increase Quality = Increase Value

Decrease Cost = Increase Value

Increase Quality and Decrease Cost = Accelerated Increase in Value


Institute of Medicine (IOM): Cost of Poor-Quality of Care in Lives and Dollars

The scope of poor quality of care (3 forms)

  • Overuse: Provide unneeded care

  • Underuse: Fail to provide needed care

  • Misuse: Make a mistake and cause harm


IOM: Overuse

Overuse occurs when a drug or treatment is given without medical justification.

  • Examples includes:

    • Treating people with antibiotics for simple infections

    • Failing to follow effective options that cost less or cause fewer side effects

  • Avoiding overuse can decrease cost


Overuse Examples

Both examples can have a negative impact to the patients and to costs:

  • Prescription overuse

    • Prescribing antibiotics for a viral illness

    • Using brand name when generics are available

  • MRI overuse

    • When use appropriate MRI’s are valuable

    • Often MRI’s do not change the treatments prescribed or a patients outcome.


IOM: Underuse

Underuse is when doctors or hospitals neglect to give patients medically necessary care or to follow proven health care practices

  • Examples include:

    • Failure to give beta-blocking drugs to people having heart attacks

    • People receiving necessary preventative care like mammograms or vaccinations

  • Avoiding underuse improves quality


Consequences of Underuse

  • As many as 91,000 Americans die each year because they do not receive evidence-based care for chronics conditions like HBP, diabetes and heart disease

  • Billions of dollars a year are spent reacting to the consequences of underuse


IOM: Misuse

Misuse occurs when a patient does not fully benefit from a treatment because of a preventable problem, or when a patient is harmed by a treatment.

  • Some examples include:

    • Prescribing a drug that a patient is allergic to

    • The appropriate care protocol is not given resulting in patient harm

  • Avoiding misuse improves quality


Consequences of Misuse

  • Billions of dollars a year are spent on helping patients recover from health care harm

  • Conservatively between 44,000 and 98,000 people die annually from preventable errors


Building the Business Case


Obstacles to Building a Business Case for Quality

  • The complexity of healthcare

  • The fragmentation of payer types

  • Lack of reliable performance indicators that correlate QI to cost savings

  • The perception that waste elimination will negatively effect patient care

  • The perception that increased efficiencies may reduce FTE’s


Preparing Yourself to Talk the Talk

  • Learn and Understand Healthcare Financial Terms and Payer Dynamics

  • Develop methodologies to measure the financial impact of improvement (ROI etc…)

  • Understand the importance of connecting financial impacts to gain management support


Dark Green vs. Light Green Money


Examples of Light Green

  • Organize equipment and supplies room to reduce hunting and searching time

  • Streamline workflow to increase efficiencies

  • Enable care givers more time at the bedside to meet patient needs

  • Reduces patient harm from falls, pressure ulcers

  • Make work more enjoyable and experience less attrition

  • Improves patient experience

  • Improves HCAHPS scores


Light Green to Dark Green

May 2, 2012 (San Francisco, California)—

  • Blood-product management plan put together by the Virginia Cardiac Surgery Quality Initiative (VCSQI) helped optimize the process and lowered the overall use of transfusions, cutting related mortality by half.

  • Savings of $50 million statewide over two years

http://www.medscape.com/viewarticle/763272


Light Green to Dark Green

A house-wide hourly rounding initiative…

…Requires the improvement of overall efficiencies:

  • Nurses spend their time in more value added activities at the bedside

    … Which is shown to improve patient and family satisfaction on HCAHPS scores

    … Which will positively effect Value Based Purchasing factors

  • Reduce Harm by lessoning Falls and Pressure Ulcers

    ... Which will reduce average length of stay for our Medicare patients

  • Decrease overall medication doses per stay

    … Which in turn will improve profit margins for fixed payment patients


IHI: Examples of Dark Green Savings


IHI: Equations to Measure Quality in Dark Green Dollars

  • Total Wages per Admission

  • Total Medication Cost per Admission


IHI: Total Wages per Admission Equation

Total wages per admission

(Worked hours per patient day)

(Average wage per hour)

(Patient days per admission)


IHI: Total Wages per Admission Equation

Average wage per hour:

  • Cost associated with recruiting and training new staff for vacant positions

  • Increased cost associated with contract labor to fill vacancies

  • Premium overtime pay


IHI: Total Wages per Admission Equation

Worked hours per patient day:

  • Inappropriate ICU staff time due to discharge delays to other units

  • Excess budgeted hours due to uneven staffing needs due to poor scheduling of surgeries with disregards to workflow

  • Excess budgeted hours due to poor prediction of demand


IHI: Total Wages per Admission Equation

Patient days per admission:

  • Excess patient day due to delays in discharge and poor coordination of the process

  • Excess patient days due to lack of setting and executing daily goals for the patient, family and care team

  • Excess patient days associated with and adverse event or complication


IHI: Total Medication Cost per Admission Equation

Average cost per dose:

  • Excess cost of brand names when generic are available

  • Excess cost associated with failure to make a timely switch in Med Administration mode (IV to Oral)

  • Excess cost associated with overuse of expensive meds when less expensive alternatives are available


IHI: Total Medication Cost per Admission Equation

Number of doses per admission:

  • Excess cost associated with failure to stop medications appropriately (continuing preventative antibiotic use longer than 24 hours after surgery)

  • The medication cost associated with treating an adverse events


IHI: Tying Equations to Dollars

Reduction in overall SSI:

  • Patient days per admissions: Decreased

  • Number of doses per admission: Decreased

  • Average length of stay: Decreased


The Financial Impact of Quality

  • Medicare Fixed Payments (DRG’s)

  • Privately Insured

  • Uninsured

  • Regulatory


The Financial Impact of Quality

Medicare Fixed Payments--Diagnosis Related Groups (DRG)


Consequences of Low Quality

  • Medicare Fixed Payments--Diagnosis Related Groups (DRG)

    • Falls / PUP / CAUTI / Falls

    • Efficiencies / Increase Length of Stay / Increase of Rx Cost

  • Increased financial deficit

  • Increased harm to patient


The Financial Impact of Quality: Privately Insured


Consequences of Low Quality

  • Privately Insured

    • Falls / PUP / CAUTI / Falls

    • Efficiencies / Increase Length of Stay / Increase of Rx Cost

  • Increased financial revenues

    • Eventual lower negotiated reimbursements

    • Eventual pressures to adjust or change payment models

  • Increased harm to patient


The Financial Impact of Quality: Uninsured


Consequences of Low Quality

  • Uninsured

    • Falls / PUP / CAUTI / Falls

    • Efficiencies / Increase Length of Stay / Increase of Rx Cost

  • Increase financial burden on patients

  • Increased likelihood of unpaid claims

  • Increase charitable care

  • Increased physical and or financial harm to patient


Federal Pressures to Improve Quality(do not pertain to CAH’s)

  • Hospital-specific historical quality performance compared to national performance standards

  • Dynamic programs that change each year

    • Measures and domains (additions/deletions)

    • Performance standards (moving target)

  • Increased financial exposure each year (max exposure shown below)

Slide provided by the Hospital Association of New York State


Takeaways

  • Improving quality and / or reducing cost increases value to the patient

  • Financial and Quality leaders can drive huge improvement and cost reductions by teaming up and learning each other’s world

  • As data becomes more available, so will the ability to tie ROI to quality

  • No matter what the industry, improving value and reducing cost equates to long term sustainability

  • Even if a quality improvement project does not impact the bottom line it may still be the right thing to do


Next Month


Resources

  • Institute for health improvement– Increasing Efficiency and Enhancing Value in Health Care

  • Institute of Medicine: Overuse, Underuse and Misuse of Medical Care

  • Blood Use Article: www.medscape.com/viewarticle/763272

  • Hospital Association of New York State - Regulatory Pressures to Improve Quality


Thank You!

Questions

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