The West Coast health system has launched six initiatives to improve clinical care and boost its operating margin.
The chief medical and operations officer for acute care at Scripps Health has developed six facets of operational excellence that she calls the 6 "Rs."
With slim operating margins, hospitals must optimize operational capabilities to remain financially viable. Recent data from Kaufman Hall shows that hospital operating margins are slim but positive: The median year-to-date operating margin index increased from 0.9% in July to 1.1% in August.
Ghazala Sharieff, MD, MBA, corporate senior vice president and chief medical and operations officer for acute care at the San Diego-based health system, has taken a multi-pronged approach to promulgating these guidelines. They have been included in marketing updates, shared with about 300 supervisors and managers who serve on the health system's inpatient management team, parceled out to the health system's physician operations executive team and physician leadership academy, and embraced by the organization's board of directors.
"It has taken on a life of its own," she says.
The six Rs are as follows.
1. Retaining staff
Like many health systems across the country, Scripps has been grappling with workforce shortages, and staff retention has become a high priority for the organization, Sharieff says.
While a primary effort has been keeping pace with market-based compensation for healthcare workers, she says, workplace culture is equally important. Scripps has "Sprint Teams" that tackle challenges and initiatives through engagement with frontline care teams. Supervisors, managers, and chief operating executives are charged with maintaining a culture of openness and communication, and C-suite executives routinely round in the health system's five hospitals to promote visibility and engage healthcare workers.
"Retention is not just about money,” Sharieff says. “It's about making sure the staff feels they are part of the solution to our challenges.”
2. Reducing length of stay
Managing hospital length of stay is important for throughput and revenue purposes, Sharieff says. In one instance, a behavioral health patient has been an inpatient at one of its hospitals for more than 900 days because the health system has not been able to find another facility. As a result, that hospital bed has been tied up for nearly three years, limiting revenue that could have been generated from other patients using the room.
"We have been tying up a bed because there are no resources to turn to in the region or the state," Sharieff says.
To address that kind of problem, Scripps has launched several initiatives to reduce length of stay. The health system is partnering with skilled nursing facilities to move patients out of the hospitals when appropriate.
Scripps has a hospital initiative called 10-12-2. Physician orders should be written by 10 a.m. If appropriate, a patient should be home by 12 p.m. And the patient's room should be cleaned and ready to go by 2 p.m. If a patient needs an X-ray or tests, the hospital tries to expedite the imaging or testing so the work is done on that day prior discharge rather than making the patient come back the next day.
Scripps is also working with county officials to increase the number of behavioral health beds in the region, Sharieff says.
"Increasing behavioral health beds is not going to be a quick process because we have a lot of patients in-house that we cannot discharge because there is no one to take them," she says. "That is a national issue that we are dealing with."
3. Reducing costs and increasing revenue
There are simple ways to reduce costs, Sharieff says. For example, the health system was able to cut rental and maintenance costs by cutting down on the number of printers on campus.
The health system has also adopted cashless registers in its cafes, which has saved thousands of dollars, and is relying on frontline staff to find other cost savings.
"That is why we have the 6Rs, so staff can understand our focus and where we need to go," Sharieff says. "Otherwise, they would not have a good idea of our strategy. When I round at our hospitals, I see the 6Rs on bulletin boards, with action plans on what they can do to reduce costs and increase revenue. For example, some units have cut down on printing documents that are not necessary."
Scripps has launched several initiatives to increase revenue. For example, the health system, which is comprised of north and south regions, formed the North Region Surgery Optimization Team five months ago. This team has looked at several factors, including the best locations for surgeries, blocking surgeon time, rearranging surgeries so they are more efficient and back-to-back, and increasing the efficiency of operating room robots. As a result, the health system performed 5,000 more surgeries over the past five months compared to the same period last year.
"This not only generates more revenue but also improves patient experience," Sharieff says, adding that more efficient and timely surgeries benefit patients.
Other initiatives to increase revenue include boosting hospital throughput, pushing growth in profitable service areas that communities, strengthening partnerships in payer contracting, and advocating for an increase in Medi-Cal reimbursement, which has not increased in 10 years.
Scripps has focused on keeping patients in network, Sharieff says. During the pandemic, the health system did not have enough hospital beds to serve patients, and it lost about 20% of its patients. Since then, she says, Scripps has made substantial progress in repatriation.
"No. 1, these are our patients, and we want them back," she says. "No. 2, it is a matter of revenue. If we have patients who are our covered lives, we get charged more if they seek care out of network. We put a Sprint Team together around repatriation, and in 2023 less than 1% of our patients have been seeking care out of network."
5. Raising money through philanthropy
To support the health system's operations, Scripps has stepped up efforts to raise money through philanthropy, Sharieff says. The health system receives philanthropic support mainly from individuals, who are often grateful patients, and from foundations, and it raises an average of $40 million annually through philanthropy.
"Scripps was founded on philanthropy nearly 100 years ago, and it continues to be an important source of financial support, particularly during these challenging economic times," she says.
6. Reassessing and reimagining
The newest of the 6Rs is reassessing and reimagining, which was adopted late this past summer. These efforts are in their infancy, but Sharieff offers a couple of examples.
One idea is reassessing the value and timeliness of meetings. A one-hour meeting with 20 people that is not necessary takes away 20 hours of staff time that could be used doing other things such as rounding or having time to strategize.
Another example focuses on reimagining certain processes or tasks. Sharieff has looked at the assignments she gives to members of her team. For example, one staff member has been chairing the Pharmacy and Therapeutics Committee for 10 years. Sharieff wants to groom the next layer of leaders, so she is going to find a new person to chair this committee, which will allow someone else the chance to learn and the incumbent will have a chance to have more time to do other things.
"That is a simple example of reimagining and thinking about succession planning," she says.
Generating positive results
Pursuing the 6Rs has improved operations and bolstered the bottom line at Scripps, Sharieff says.
"We have had 5,100 more surgeries in five months. The repatriation numbers went from 20% out of network to less than 1%. We have saved millions of dollars with our pharmacy team, supply chain, support services, and consolidation of vendors. We have made progress on retaining staff—we are not paying as much for travelers such as traveling nurses," she says.
Christopher Cheney is the senior clinical care editor at HealthLeaders.
To increase healthcare worker retention, make sure compensation is competitive and organizational culture appeals to staff.
Reduce hospital length of stay to increase throughput and revenue.
Raise money through philanthropy to boost the bottom line.