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Systemwide Process Improvement

Karen Minich-Pourshadi, for HealthLeaders Media, April 14, 2011
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Virginia Mason’s chairman and CEO, Gary Kaplan, MD, and his senior management team created a systemwide program that changes the way healthcare is delivered. Today, Virginia Mason trains others: Healthcare leaders from more than 30 states and eight countries have come to its site to learn this process improvement approach.

“With the current economic challenges, this work [process improvement] is even more compelling,” says Kaplan. “However, it’s important to differentiate that this is a way to manage and lead—it’s a management system, not a program.”

That distinction is key, he says, because failure to roll it out on a broader scale will mean failure to reap the full reward.

“In the early years, we said, ‘We can’t be successful unless we change the mind of senior leadership,’ so they were the first people we trained. So often we find people come to learn the VMPS, but we learn that their C-suite isn’t engaged—it’s really a critical piece of the process,” he says. “Healthcare is known for following the fad of the month or year to save money … but we look at this as a comprehensive management system that’s also about quality, safety, and patient and staff satisfaction.”

Having that philosophy has landed the organization accolades, such as HealthGrades’ Distinguished Hospital for Clinical Excellence designation, which places Virginia Mason among the top 5% of hospitals nationwide for clinical performance, as well as Leapfrog’s Top Hospital of the Decade. Along with the quality kudos, it has also seen its financial position flourish during a time when many providers were struggling.

“VMPS has been a critical to our success factor. If we hadn’t put it in place years ago, at the beginning of the economic cycle, then our economic successes as well as our clinical success in quality and patient safety wouldn’t have happened—it buoyed us,” he says. “By continuously taking out waste over these 10 years, and getting better and better at improving our quality, we’ve lowered our cost position. Our cost per dollar of revenue continues to decline.”

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1 comments on "Systemwide Process Improvement"


james mcniff (4/15/2011 at 8:56 AM)
This same opportunity exists in non-clinical applications like the revenue cycle..Per AHA, hospital expenditures for 2009 was 724 billion dollars..If we assume a 5% margin the net revenue would be about 760 billion..The average hospital's cost to collect is about 4%..This equates to 30 billion spent on the revenue cycle..Through the application of the HIPAA business transactions,intelligent software and process redesign there is the potential of reducing these costs from 30 to 50%..A savings of 10 to 15 billion dollars a year for the industry..