Length of Stay: The Management Headache That Will Not Go Away

Like antibiotic-resistant bacteria, the challenge to reduce length of stay (LOS) persists . . . despite the best efforts of even the leading healthcare organizations. And this uncomfortable reality comes at a time when the need to improve LOS couldn't be greater.

The current financial crisis notwithstanding, operating margins have continued to shrink and raising capital has become a daunting task. This increasing financial pressure comes at a time when EMR and other technology investments are needed to stay viable as a quality healthcare provider. Unless you have a lot of empty beds, improving patient throughput is key to successfully managing this pressure. The stakes are very high. It's too expensive to invest in more bricks and mortar without first maximizing patient throughput; and your system may be bleeding several million desperately needed dollars due to throughput inefficiencies.

Why Your Current Efforts to Improve Throughput Haven't Worked
Most healthcare systems have recognized the potential for improved patient throughput, and have accordingly launched focused initiatives to improve their average LOS. But many haven't realized anything close to the results they were reasonably expecting. There are several reasons, all of which may be contributing factors in your organization:

Blind Faith In "The Book of the Month"
It would be a wonderful world if formulaic approaches to running complex organizations actually worked. It is this perpetual hope that drives virtually every healthcare organization to launch a "continuous improvement", "six sigma", or "lean" corporate initiative. The faith is based on the assumption that providing common tools and methodologies to all managers and requiring certain process structuring tools, in effect "scripting behavior", will result in improved outcomes.

The reality is both simpler and harder. Implementing a patient throughput improvement strategy requires translation of that strategy into redesign of work throughout the organization. It will require rethinking legacy assumptions about key roles and processes, and the establishment of clearer and more specific accountabilities. And it will require embedding into your organization an ongoing capability to challenge process in the pursuit of improved outcomes.

There is no "plug and play" approach that will work.

Getting What You're Paying Your Managers For
As healthcare systems have implemented programmatic corporate initiatives like we just described—which by the way usually add a new cost center to the financials—a more important question never comes u p first: "Why aren't we getting the continuous throughput improvement we're already paying our managers to achieve?"

In effect, a new corporate improvement initiative enables managers to further abdicate what little accountability they felt for process improvement, such as patient throughput. "This is a six sigma project," becomes the common refrain when a problem such as LOS is identified in a manager's area of responsibility. The reality is, in most organizations the role of the manager has devolved to one of scheduling and managing daily task activity, rather than challenging current process and driving improvement. Creating a corporate initiative cost center and resource is, in reality, a "band-aid" for fundamental managerial accountability gaps. Rebuilding your management infrastructure is the only way to embed and sustain an increasingly higher level of performance throughout your organization.

Automating a Process Does Not Necessarily Improve It
Electronic medical record technology is being implemented every day that does not help improve quality of care or better manage patient throughput. Despite millions of dollars invested in information technology, there is little evidence of the right data having been defined and regularly monitored to manage patients expeditiously along a predictable, evidence-based best care path. Useless reports have been automated, and getting useful information sometimes requires working around the information system.

If the new system isn't based on a logical, understandable and credible connection with improved patient throughput and measurable quality outcomes, why spend money on it?

Who Will Talk To The Doctors?
Some healthcare organizations that are focused on reducing LOS actually have very good metrics of the various reasons for discharge delays. One of the most common reasons (but not the only one) is physician decision-making contrary to a typical, predictable care path. While physician impact on the organization's outcomes is measurable, the organization frequently doesn't communicate or act on variances . . . because "we don't question our physicians' decisions."

We aren't advocating "cook book medicine" as predictive care path management is described by physicians resistant to any organizational influence on how they practice. But there should at least be discussion about variances in care approaches in the spirit of evidence-based medicine and improving quality outcomes in an environment that is increasingly demanding clinical and economic value for its dollar. Why measure if you won't engage in ongoing discussion about the metrics?

Requirements for Success in Patient Throughput
We've just described some of the most common reasons why serious and well-intended efforts to reduce LOS haven't worked. Let's now review what does work.

Management Infrastructure That Can Systematically Assess Processes and Conduct Breakthrough Process Redesign
To embed and sustain a higher level of performance throughout your organization you need to build management infrastructure capable of translating a desired endpoint like throughput efficiency into action, managing the change required. No significant strategic change can be sustained without implementing it through the efforts of an effective manager. It is managers that:

• Provide clarity about key job roles and how they impact important objectives such as throughput improvement
• Identify key work process which must be redesigned to achieve better outcomes
• Identify appropriate outcome and process metrics . . . not task activity metrics . . . and establish monitoring of these metrics so corrective action can be taken in real time, not well after the fact
• Establish clear and specific accountabilities for outcomes, monitoring, and corrective action . . . and hold people accountable
• Competently lead complex projects, translating expected strategic change into action via a project plan that identifies every action needed, who will do it, when, and with what supporting resources

Just when they are needed most, healthcare organizations are finding that they haven't developed managers to do that for which they are paid. Organizations serious about patient throughput must address this gap in a hurry, focusing on developing the manager's role rather than creating band-aids for what's missing.

Redefinition of Core Roles and Streamlining Enabling Tools
Underlying the patient throughput management process are three critical and often overlooked infrastructure areas–Care Coordination, Social Work, and Nursing. These functions are the critical leverage points impacting overall institutional profitability. Typically, healthcare organizations have invested in efforts to address large cost areas in their supply chain or areas that drive direct revenue. It is less common to undertake a systematic analysis of these front-line care functions, especially Care Coordination and Social Work, even though performance in these areas has profound implications for the bottom line.

Some of the more important changes in these areas, which challenge base assumptions about traditional roles, include:

• Reversing the fragmentation of the role of the nurse, restoring clear accountability as the bedside care path manager
• Redefining the mandate of social workers, redefining what is often seen as a "patient advocate" role to a role which owns the hospital's objective to efficiently manage the discharge process, with competencies to aggressively negotiate with post-acute care providers
• Focusing care coordinators on care path analysis and adoption of best practices … rather than frittering away this skilled and expensive resource as a substitute nurse or an expeditor to cover for poor internal processes or unresponsive services

Engaging Physicians in Real Collaboration
Skyrocketing healthcare costs have provoked a new level of scrutiny from payers, patients, and the government. Demands for value in terms of improved health outcomes are increasing, and they are not being satisfied by the industry's traditional outcome metrics. This is straining what used to be a solid partnership between physicians and hospitals. Faced with the same economic squeeze, both parties have to work together to deliver better care and at lower cost.

Like it or not, tweaking the current care model isn't going to cut it. No one will get paid to fix infections acquired at the hospital or injuries due to falls. No one is going to choose a care provider based on a lower chance of operating on the wrong knee, or dying from surgery. Hospitals and physicians will be reimbursed based on the cost and quality outcomes patients achieve under their care.

This is the shared objective upon which hospitals and physicians must engage in dialogue and determine what they will change to achieve such an objective. Some hospitals are approaching their need to "engage physicians in dialogue" by hiring physicians and buying practices, in the unstated belief that once they are employees the hospital will have more control over their practice behavior. The real truth is that, if no one in the hospital has the accountability, skills, and power to negotiate with physicians over things they consider their sole prerogative, making them employees won't change anything.

The Financial Implications Deserve a Sense of Urgency
•Based on our patient throughput improvement work with large healthcare systems there are astonishing potential financial gains. Listed here are some of the typical savings that have been realized:

• Restructuring the role of the social worker resulted in significant staffing level implications. In one instance, 70% of their new patient assessments were redundant with the nurse's assessment and could be eliminated. This change alone allowed a 10% reduction in work activity which represented nine unnecessary positions at a loaded annual cost of $810,000.
• In redefining the care coordinator role, one client realized 50% of care coordinator activity was work that was a primary responsibility of other roles, particularly nurses and social workers. Keeping such work where it belonged allowed a staff reduction of ten care coordinator FTEs, which represented an annual savings of $900,000.
• Support service delays accounted for over 30,000 days of unnecessary LOS at one hospital. This hospital estimated the cost of a non-reimbursed patient variance day to be $2,000. Implementing a rapid turnaround of support service managerial accountability reduced LOS due to such delays by 25%, representing an annual savings of $15 million.
• At the same hospital discharge planning delays accounted for almost 35% of LOS variance. Providing social workers with improved tools and process and developing their negotiating competencies resulted in a 25% improvement in this area, representing an annual savings of $6.5 million.
• In another organization, physician lack of compliance with timely order entry, follow up, and discharge planning accounted for 10% of LOS variance, representing an annual cost of $7.5 million. Just the beginning of structured engagement and dialogue with physicians about outlier behaviors realized an immediate 10% reduction of this cost.

Assuming $2,500 as the opportunity cost for a non-reimbursed day, a hospital with 10,000 discharges foregoes over $6 million annually for every quarter day of average LOS variance. In a world of shrinking margins and almost inaccessible capital, how can the potential of patient throughput improvement not be a leading topic at every executive leadership meeting in your organization?