Lean Healthcare, Virginia Mason wrap-up

After thinking about Virginia Mason's experience with lean process improvement, it's become even clearer to me that the simplest, most a-political solution to the healthcare mess in America is a reworking of the reimbursement model to encourage value-add services and discourage wasteful services. This, of course, is still a highly political issue and would be very difficult to implement. Any time you make a change to 1/6 of the largest economy in the world in a way that creates many winners and losers, it's a political solution, there is no avoiding it. But, reworking the reimbursement models in America would be the least ideologically-driven move we can make in health care right now. Eliminating wasteful procedures that don't add value should appeal to the liberal and conservative alike. It should appeal to everybody except for the doctors and hospitals who have been getting rich performing unnecessary services, but that's one group that can not be appeased by any solution that actually solves anything. And it's possible that a health care system that consistently delivers value instead of waste will allow providers to make as much as they were making before, but will simply result in a much healthier populace.

I know there's a lot of talk about this around the web right now. Brian Klepper, who posts from time to time at the Health Care Blog and at Bob Laszewski's Health Policy Blog, has been beating this drum for years, as has Maggie Mahar. Consider me fully in that camp.

Oh, and incidentally... one of the mysteries around the web was why Virginia Mason seemed so comfortable with their situation, even thought their Lean initiative was eliminating some of their highest margin procedures, presumably hurting their bottom line. I was tooling around the web researching general lean healthcare trends and found this:

Virginia Mason applied the principles of VMPS (Virginia Mason Production System) when designing its new Center for Hyperbaric Medicine. Originally, staff felt that larger hyperbaric chambers would require the construction of a new building. But careful analysis proved otherwise. The team not only found they were able to build the new Center in an existing hospital space, which saved $2 million in construction costs, but they were also able to design the Center so that more patients can receive treatment simultaneously, eliminating waiting time. The new Center can also accommodate emergency cases without interrupting regularly scheduled patient care. 

The Center’s location within the hospital also eliminates the need for patients to be transported via ambulance to a separate campus site for care, saving approximately $55,000 annually in ambulance expenses alone. 

When you do things efficiently, you find you're saving money in ways you didn't even think of.

Comments

[Amy]

It's amazing that this line of thinking isn't intuitive to any business model, i.e. eliminating wasteful processes to streamline business practices, thus making costs and revenue easier to predict. I don't understand why more people don't think of all of the hidden savings that comes with making their business more efficient. It just seems like a no-brainer and in this case, a great solution for the betterment of our healthcare system.