At Sg2, we tout the power of standardization and minimizing variation, but we also recognize that variation, in terms of volume fluctuations, medical care trends and catering to the varied needs of patients is a day-to-day reality. Fluctuating service volumes and case mix create performance complexities, affecting current operations and revenue cycles and influencing future strategic initiatives. The key to successfully navigating care fluctuations is to discern meaningful and actionable information from statistical noise in assessing data, recognizing patterns, managing what you can manage and preparing for what you cannot.
Obstetrics and Other Examples
In my world of obstetrics, where more than 4 million babies are born nationwide every year, accounting for approximately 13% of adult admissions, fluctuations in volume and changes in case mix significantly impact day-to-day management and long-term strategic planning for obstetrics leaders. Here are just a few examples of the variations inherent in obstetrics, according to the US Centers for Disease Control and Prevention:
- Yearly fluctuations in delivery volume. The total number of babies born in the US declined in 2008 by approximately 2% and again in 2009 by 3%. To put this in perspective though, this is down from an all-time high delivery volume in 2007. The current decline in the fertility rate indicates that some markets soon may see a bounce back as women who delayed childbirth during the recession now choose to begin families.
- Daily/monthly fluctuations in delivery volume. Deliveries are far more likely to occur on weekdays compared to weekends, and fall/summer months see higher delivery volumes than the winter. Both of these trends point out the need to look beyond the average daily census when assessing facility projections.
- Clinical trends. I have written many times before about the increasing cesarean section rate (at an all-time high of 33% in 2009), increasing induction rates (23% in 2008) and slow declines in preterm and early-term deliveries. Clinical trends collectively alter the case mix in practice, changing bed needs, neonatal intensive care unit utilization and staffing.
Obstetrics, however, provides just one example of the many facets of inherent variation among different service lines. For example, inpatient pediatric census tends to be highest in the winter due to higher rates of infectious disease, respiratory infections and gastrointestinal disorders. Emergency department (ED) volumes fluctuate substantially by season, day of the week and time of day. Elective and preventive services volumes have declined over the past couple of years due to the economy and the potential to postpone or forgo care such as mammography screenings and well-woman gynecologic exams.
Implications of Inherent Variation
Fluctuating levels of clinical activity are a reality across all service lines, influencing discrete decisions about staffing the next shift, as well as strategic decisions about capital expenditures. Random fluctuations can be problematic, diminishing the capacity to address problems proactively. When clinical activity ebbs, valuable resources, including staff, beds and the operating room (OR) are underutilized. When the pendulum swings, insufficient capacity creates operational bottlenecks, potentially resulting in lost revenue.
Census variability also creates clinical problems, potentially leading to compromised patient safety and increased liability. When a clinical unit is stretched to its limits, providers may fail to recognize a crisis and mount the most effective response. Census levels are lower at off hours, but available data suggest that clinical outcomes suffer at these times, perhaps because there is insufficient expertise immediately available to best manage emergencies.
Determining “Controllable” Fluctuations
Variations in organizational census and case mix may appear largely random, but health care leaders can, in fact, exert a surprising degree of influence over the ebb and flow of patient care. Most obviously, organizational structures and physician practice patterns influence where and how patients receive care. The census in the ED, labor and delivery and the OR all reflect decisions about scheduling procedures and the availability of office hours for urgent care during evenings and weekends.
Less conspicuously, deliberate policies about marketplace positioning and staff alignment can be used to change the demographic contours of the organizational referral base. For example, an organization could survey the community landscape from a needs or profitability standpoint and make a deliberate decision to position itself in the market as a leader in managing diabetes or treating chronic obstructive pulmonary disease. Likewise, a Systems of CARE (Clinical Alignment and Resource Effectiveness) approach to prevention means that epidemiologic trends need not dictate organizational destiny. This type of smart growth, in considering appropriate care along the care continuum, not only delivers value to patients and creates institutional financial stability, but can also be used as a strategy to address care fluctuations.
Improving Management of Fluctuating Care Patterns
There are 2 basic strategies for rationally approaching care fluctuations: Go with the flow in maximizing flexibility for unpredictable situations or conversely, buck trends by understanding what can be altered, leveraging this knowledge to the benefit of the organization and the patient. These 2 actions must coexist in situations that have both controllable and unpredictable variations. To best succeed in leveraging inherent variability in the near- and long-term:
- Anticipate and monitor trends in your organization. Recognize which metrics are important and track their variations by year, month, day and time to assess process and patient flow. Selecting the right metrics to track on a daily and even hourly basis can inform staffing, which can drastically alter the profitability of a service line and the organization as a whole. In terms of operational fluctuation, metrics documenting procedure volume and type may be important, as well as the number of visits, type of imaging or tests and census. To understand the severity of fluctuations, analyze the seasonal, daily and even particular hours when fluctuations impact the work flow.
- Discuss care fluctuations with clinical staff. Recognize the clinical aspects of variation and determine why they exist, understanding both physician behaviors and patient characteristics. The clinical staff can help explain staffing implications, as well as provide insight into what can be controlled and what volume fluctuations are natural.
- Temper variation with flexibility. For example, staffing flexibility can be achieved by cross-training nurses in various areas, or designating an on-call team.
- Standardize care as appropriate. Establish protocols for care delivery, standardized order sets and scheduled care as deemed reasonable. Standardization, protocols and scheduled care can help manage fluctuations through reductions in clinical variation and operations improvement.
- Develop contingency plans for scheduled services when emergencies threaten to throw off the schedule.
- Think both long-term and short-term in considering the impact of fluctuations on the clinical nature of each service line. Understand these trends to determine long-term implications, not just day-to-day operational bottlenecks and staffing decisions. In the example of obstetrics, long-term facility planning may need to take into account the monthly and daily fluctuations in postpartum census to truly understand the risks of overcapacity in new facility designs.
Analyze and understand the root cause of fluctuations, controlling what you can control and creating contingencies for what you cannot. By understanding the implications for today’s operational and staffing choices, you can best shape tomorrow’s strategic and facility planning decisions.