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How Yale-New Haven Health System Cut Spending by Millions

Analysis  |  By Christopher Cheney  
   October 06, 2016

Embarking on a "quest for unparalleled value," YNHHS has pared down spending system-wide in four categories.

This article was originally published on May 2, 2016.

A health system associated with one of the country's most respected institutions of higher learning is learning how to adapt to leaner times in the healthcare industry.

Last week, Yale-New Haven Health System, which operates three hospital campuses in the south-central region of Connecticut, co-hosted the first annual National Symposium on Value Innovation at Yale.

During a break at the symposium, Stephen Allegretto, CPA, MPH, who serves as vice president of strategic analytics and financial planning at YNNHS, told me the health system's leadership saw reimbursement cuts coming to Medicare and Medicaid in 2012. "We looked to the future and said, 'Whoa, our revenue is going to dry up. We need to look at this and see how we are going to get money out of the organization,' " Allegretto said.

In her keynote address launching the Yale symposium, YNHHS President and CEO Marna Borgstrom, MPH, said the health system's leadership has been committed to generating value for patients as opposed to emphasizing cost-cutting alone. She described the effort as a "quest for unparalleled value."

"It's not about what we can do, or what we need. It's about generating value for our patients," she said.

On the quality and patient safety side of the value equation, YNHHS has adopted several initiatives over the past four years such as the development of rapid response teams and the deployment of predictive analytics in clinical settings that have contributed to significant gains in patient outcomes. At YNHHS's St. Raphael Campus, those actions have generated a 30% mortality rate reduction.

In September 2012, YNHHS spent $160 million to acquire the former Hospital of Saint Raphael, a struggling safety-net hospital in New Haven located about a quarter mile from the Yale-New Haven Hospital campus. The deal created a 1,541-bed, dual-campus hospital in the heart of the city.

Christopher Cheney is the senior clinical care​ editor at HealthLeaders.

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