"The consequence of issues with our financial viability could've been dire. If we couldn't eliminate the waste, we might have to do across-the-board cuts," says Burnette. "Those cuts are popular at hospitals, but we'd rather do targeted cuts. And we view layoffs as a last resort, as you have to maintain staffing ratios. So we were very interested in slowing the rate of growth and cost through Lean and other initiatives."
The Lean initiative was just the start. Over the last seven years, Denver Health has moved from low-hanging fruit to the long-term sustainable cost reductions that every financial leader seeks, Burnette says. She lists four measures for sustainability:
For example, this past month Burnette and her team extended terms with two vendors. In return, one vendor made concessions worth $420,000 over the term of the contract. The second vendor gave Denver Health equipment and supplies, which meant avoiding the cost of purchasing those items—a savings of about $2 million in equipment and $1.3 million in supplies, she says.