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Analysis

How Gundersen Harnessed Data to Reduce Orthopedic Costs

By Jack O'Brien  
   November 29, 2018

The La Crosse, Wisconsin-based system implemented a new initiative to enhance its cost savings and improve quality outcomes. 

Beginning with its orthopedics unit two years ago, Gundersen Health System has embraced data solutions that have reduced the cost of knee replacements by almost 20%. 

As operating margins continue to shrink and financial challenges arise, the need for health systems to effectively cut costs is now more pressing than ever. 

The Wisconsin-based health system has utilized data analytics through a cohort of other health systems to identify approaches for improving inpatient costs. Gundersen also teamed with Avant-garde Health, a healthcare analytics company, to automate the changes with a goal of achieving cost savings and maintaining quality.

The results of this initiative have included an 18% decrease in knee replacement costs, a 22% decrease in the use of higher-cost post-acute care facilities, and a 68% increase in same-day physical therapy. Additionally, Gundersen switched to a generic bone cement that cost 57% less compared to the alternative medical supply.

The initiative follows a value stream mapping approach, which visualizes all aspects of a workflow, including the product along with the management and technological support needed throughout the process.

Lisa Wied, vice president of clinical operations at Gundersen, previously worked in the manufacturing industry where value stream mapping is commonly utilized and is bringing that approach to healthcare. Wied told HealthLeaders that her advice to other health systems looking to model an approach after Gundersen is that manual value stream mapping is not easy, it takes a time commitment, and it requires engagement from "all different areas" within the system.

Related: Change Management 2018: The New Rules

Embracing a data-driven approach

Wied said Gundersen's interest in refining clinical care at its orthopedics department began by joining a cohort of other health systems, which provided an opportunity for Gundersen to examine its internal data on costs and compare that information to the de-identified data of fellow cohort members for knee and hip replacement costs. 

After reviewing the prospects of embracing data-driven solutions, Wied said receiving buy-in from clinicians was crucial to ensuring the success of the initiative. 

"Just because we had the data and could look at [it] and understand where our opportunities lie didn't mean that we could just go ahead and make the changes," Wied said. "It's also dealing with the culture. We had to deal with the culture of change in our organization and orthopedic department." 

When Gundersen first considered its new data-driven approach to orthopedics, Wied was serving as director of the orthopedics center, but she had to work with the separate directors of the orthopedic unit, operating room, and physical therapy for their opinions.  

As part of courting clinical team support, the health system has hosted what Wied called "dinner meetings" with knee and hip replacement surgeons to ensure they are on board and open to collaborating on ideas for improvement.

At these meetings, Wied and her team provide a portion of the available data to avoid overwhelming the surgical teams and invite them to participate in a roundtable discussion about the research and what opportunities it affords the department. 

Wied said it took Gundersen about nine months from the health system's initial interest in gathering data, to incorporating the data, then responding to the data. 

Reducing costs with proactive care

Wied said Gundersen's most significant savings were gained in length of stay, with a particular focus on addressing patients earlier in the care process to achieve savings down the line. 

Gundersen has implemented a rule for patients to be ambulated on the day of surgery, with a primary goal of getting the patient out of bed. 

"The sooner patients get out of bed, the healthier they are, the better they are healing, and the sooner they can be discharged," Wied said. "Our goal was to decrease length of stay, which is a big cost savings for our patients, and also to have our patients go home rather than to short-term care facilities, which again is a cost savings for the patient."

Similar to how the organization had to change its internal communications among staff, Gundersen also altered how it communicated with its patients. In addition to making changes along the care continuum, the health system also focuses on enhancing its preoperative patient education to ensure that patients have everything in order such as ambulation, so they can discharge as early as one day after surgery.

Pushing the initiative beyond orthopedics

With to the success of the orthopedics initiative, Gundersen is looking to expand the data-driven approach to other specialty areas, including neurosurgery, cardiovascular surgery, shoulders, sports medicine, and podiatry.

Wied said the health system is also examining potential new pathways of care for oncology and breast cancer patients, though those models have not been completed yet.

Despite the complexity of the work, Wied believes other health systems can replicate value stream mapping through a small financial investment, but she cautioned there is a major investment of time. She said Gundersen did not hire additional staff to enact the orthopedics initiative, but the health system expended considerable effort communicating with staff.

Wied added that use of an automated tool, such as the one provided by Avant-garde, helped streamline the process for Gundersen. She said the organization utilizes the third-party system to measure itself against benchmarks over time to determine how much progress has been made.

Wied said if a health system doesn't have internal data, it is "a lot of work" to create it manually. However, the effort is manageable, she said. Gundersen has manually implemented a manual value stream mapping process for its renal dialysis units, which Wied said has generated positive results despite the additional labor.

"You have to be committed to providing the resources to do the work," she said.

Jack O'Brien is the finance editor at HealthLeaders. 


KEY TAKEAWAYS

Costs associated with knee replacements have declined by nearly 20% in two years.

While the financial commitment to restructuring is minimal, a Gundersen executive says time is a larger consideration.

Utilizing data is important, but ensuring that the organization's culture buys into the process is crucial.


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