This article appears in the January 2012 issue of HealthLeaders magazine.
Consumers, payers, and the government are demanding that health systems get more efficient. Whether that means cost-cutting initiatives, performance improvement programs, or a combination of both, smart and innovative organizations have been working to solve these massive challenges for several years.
The vast majority of hospitals and health systems could learn a lot from these innovators, who have borrowed liberally from other industries to tame the healthcare cost explosion. Two of the most successful are Denver Health and New Jersey's Virtua Health, and speakers from both organizations were on hand for an Oct. 26, 2011, HealthLeaders Media Rounds event, live from Denver Health, to discuss their techniques, their successes, and even their failures.
Borrowing from others
The centerpiece to Denver Health's record of performance improvement comes from Lean management techniques that have been integrated into the everyday work of more than 225 Lean-certified "black belts," who are responsible for helping departments drive as many as 10 rapid improvement events a month at the organization, each with a defined monetary goal of savings, said Patricia Gabow, MD, the longtime CEO of the safety-net hospital and possibly its biggest Lean supporter. Further, each black belt is responsible for at least $30,000 in cost reductions each year.