Post on 14-Apr-2017
transcript
HFMA Session: Achieving Transformation and Dramatic
Results Through Benchmarking
Melissa Johnson, CFO, Baptist Medical Center South
Samantha Platzke, CFO, Care Logistics
A Baptist Medical Center South Case Study
Are hospital CFOs measuring the right things?
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We often focus first on lagging indicators:
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But what levers really control them?
• Operating margin • Net margin • Days cash on hand • Days in A/R • Expenses
The new world for hospital financial
leaders requires new thinking
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H&HN: “It’s a significant time for financial executives. It’s not just looking at your history and assuming that’s what will be your future.”
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Sept 9,
2104
Question: What do you consider the top 5 critical responsibilities of today’s hospital CFO?
The Challenges Today Are Clear
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• Record Low Revenue Growth
• Credit Upgrades Decline
• Credit Downgrades Increase
• Expenses Outpace Revenues
October 16, 2104
Becker’s: “Hospitals are having difficulty identifying ways to decrease expenses, having already picked much of the low-hanging fruit.”
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Hospitals must manage costs through better and
more efficient operations, not further cuts.
Leading indicators of care efficiency predict performance:
• ALOS • CMI
• O/E ratios • ED flow • Denials
• Utilization
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Where to Focus? What to Measure?
What if the right system—people, processes and technology—would let you set and measure in
real time leading operational metrics?
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Foundation for Benchmarking
What if you could define your current state and the
right benchmarks, and ensure a path to the desired future state?
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Setting Appropriate Goals
What if you could take action today that will drive, measure and predict the success in metrics that matter
most to your hospital?
How Baptist Medical Center South made
benchmarking a foundation for successful
transformation
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You Can, and Here’s How
“Patients First, Compassionate Care, Pursuing Perfection”
Transformation Success: • LOS: 4.2 to 3.8 • CMI: 1.63 to 1.83 • LWOT: 8.14 to 1.25% • Added annual capacity of
1,600 beds • Readmission rate: 10.5%
Baptist Medical Center South Snapshot
• Founded in 1963 • 514 licensed beds (454 acute, 60 psych) • Flagship tertiary care hospital for system • Level 2 trauma service • Regional referral center for cardiac and
stroke care • Teaching facility with two primary care
residency programs
• Establish standard of excellence and compare performance with that standard
• Set quantitative measures
• Benchmarking theory: Compare performance, identify gaps and change management processes to address them
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Defining Benchmarking
Healthcare institution must apply this discipline to reduce expenses and simultaneously improve product
and service quality
Pursuing Perfection: Benefits of Benchmarking
• Understand strengths and weaknesses • Realize what levels of performance and
improvement are possible • Compete better by stimulating continuous
improvement—get and stay exceptional • Better satisfy customer needs: Quality, cost, product
and service • Promote better quality, productivity and efficiency,
which drive innovation and competitiveness • Cost effective way to pool and apply innovative
ideas
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BMCS Benchmarking: Kickoff
Objectives for deployment and kickoff at BMCS:
1. What is the current condition (Where are we)?
2. What is the desired condition (Where do we want to go)?
3. Prioritize needs—focus on the breakthrough objectives.
4. Create the plan to achieve objectives (Executive A3).
5. Deploy the plan, with a deployment leader to oversee each key strategy.
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• Defined areas to benchmark • Quantified current state metric for each area • Budgeted specific improvements for FY 2015 • Identified Baptist Health System liaison for each area • Identified internal, industry and other sources of benchmarking data • Determined level of information needed to enable continuous
improvement with peer comparisons: – High Level: Hospital wide metric – Medium Level: Division wide metric – Detailed Level: Department metric – Specific Level: Job-level metric
• Set plans for benchmarking process by area – Resources required – Timeframe – Milestones
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How BMCS Set Effective Benchmarks
• Compares performance, identifies gaps and changes processes to improve
• Uses people, process and technology to improve data quality while making it easier to obtain
• Applies “production” principles and tools to take fast, effective actions that improve performance
• Created and uses meaningful benchmarking scorecards to comprehensively track performance and gains
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How BMCS Uses Data to Continuously Improve
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Cascading Scorecard Strategic Pillar Weight Criteria
Meets = At or under budget score =5%
Does not Meet = Above budget score =0%
Exceeds = 100% or above score =5%
Meets = 98 – 99% score=4%
Does not Meet = less than 98% score =0%
To Meet Goal: score = 5%
Clinical – meets productivity w/OT 3% or less
Non-clinical – meets productivity w/OT 1.5% or less
=> Budgeted Volume score = 5%
=>97% and < 100% Budgeted Volume score = 4%
< 97% of budgeted volume score = 0%
Patient Satisfaction
Hospital Exceeds => 90
th percentile score = 10%
(Overall Hospital) Meets = 75th – 89
th percentile score = 7.5%
Does not Meet < 75th percentile score = 0%
Patient Satisfaction
Department Exceeds => Dept. 90
th percentile score = 10%
Meets = Dept. 75th – 89
th percentile score = 7.5%
Does not Meet < 75th percentile score = 0%
Exceeds = Engagement => 40% score = 12%
Meets = Engagement =>32% AND Increased 1% or > score = 8%
Meets = Engagement =>32% NOT Increased by 1% score = 6%
Meets = Engagement => 22% AND Increased by 3% score = 3%
Does Not Meet = Engagement < 22% score = 0%
Rating of “A” or “B” score = 8%
Rating of “C” or “D” score = 0%
Meets = turnover <= 13% & RN<=20% score = 7%
Meets = Turnover <= 13% & RN>20% score = 4%
Does not Meet = turnover > 13% score = 0%
Engagement – 30%
Quality & Safety – 20%
Patient Experience – 20%
12%
10%
10%
10%
Team Member
Survey
Engagement
8%Leader Talent
Assessment
3%Leadership
Standard Work
10%
7%
Turnover
All Dept <= 13% &
RN <=20%
SMART Audits
Stewardship & Growth –
20%
Care Coordination10%Care Coordination - 10%
*If no dept.score,
Hospital = 20%
Productivity
Dept. specific
indicator
Growth5%
Overtime 5%
5%Total expense per
critical stat
5%
Completes scorecard for leadership Standard work: % of weeks
completed X 3%
Measurement
Applies to specific departments noted in template instructions. If dept. is not
designated for growth target then the weight for Total Expense per critical stat
is increased to 10%.
Security & Engineering – meets productivity w/OT 2% or less
Applies to departments that have Care Coordination related metric as noted
in template instructions. If department does not have this metric, each of the
Quality & Safety Criteria will have a weight of 15%.
Meets / Does not Meet as determined by dept. goal
Meets / Does not Meet as determined by dept. goal
Performs SMART Audits: 32 weeks/year meets; <32 does not meet
Talent Management Eye Chart (top down)
Leader Name PMEC TMEC
Indicator PMT Indicator PMT Indicator DOR Indicator HCAHPS Indicator see below Indicator HR report Indicator M7 35.64% 54.1% / B+
Target 100% Target 3% Target 293.31 Target 75% Target ********* Target < 13% Target 120 min
Actual 89.76% Actual 10.40% Actual 266.93 Actual 67.00% Actual ********* Actual YTD 52.38 Actual 2.5
Indicator PMT Indicator PMT Indicator DOR Indicator HCAHPS Indicator see below Indicator HR reprt Indicator M2
Target 100% Target 3% Target 593.39 Target 75% Target ********* Target < 13% Target 60 min
Actual 99.76% Actual 4.90% Actual 559.56 Actual 79% Actual ********* Actual YTD 32.47 Actual 1.46
Indicator PMT Indicator PMT Indicator DOR Indicator HCAHPS Indicator see below Indicator HR report Indicator M2 / M7
Target 100% Target 3% Target 276.86 Target 75% Target ********* Target < 13% Target 1.0 / 2.0
Actual 76.27% Actual 13.79% Actual 486.19 Actual 79% Actual ********* Actual YTD 38.04 Actual 1.57 / 2.48
J. Heston / Ortho
J. Heston / MICU
J. Heston / 5 SW
LEADERSHIP
Productivity
Weight ______
Overtime
Weight______
Exp. Per Critical Stat
Weight______
HCAHPS
Weight______
Quality/Safety
Indicators
Weight ______
BAPTIST MEDICAL CENTER SOUTH
MONTHLY LEADERSHIP SCORECARD
FY 2014 - May 2014
Care Coordination
Weight______
CARE COORDINATION
Employee Turnover %
Weight______
EFFICIENCY & GROWTH PATIENT EXPERIENCE QUALITY & SAFETY ENGAGEMENT
Entity Level Strategy Pillars & KPI’s (established annually) Individual Leader
Performance Criteria
(established annually)
Department/Leader Scorecard
(updated monthly)
Department Pillar Board
(updated monthly)
Pillar KPI’s & Process Measures (Updated Monthly)
Where Benchmarking Already Existed
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Stra
tegi
c Th
em
e
Quality & Patient Safety
Engagement
Patient Experience
Core Measures
Value Based Purchasing
Employee Engagement Survey Benchmarking
Associate Retention
Patient Experience Survey & HCAPS Benchmarking
Financial Statement View for
Operations Improvement
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Levers Sublevers
Denials
Clinical Documentation
Patient Statusing
Utilization:
Diagnostics
Pharmacy
Level of Care
LOS
Psych, ED, OBS, Acute
Care
Coordination/
Revenue Cycle
Care
Coordination/
Clinical
Levers Sublevers
Revenue
Cycle/Charge
Capture
Late Charges
DNFB
AR Days
Productivity Index
Overtime Hrs as % of Total
Hrs
Labor Exp. As % of Total
Oper. Exp.
OR Supply Cost per Case
Cath Lab Supply Cost per
Case
Productivity
Supply Chain
Car
e C
oo
rdin
atio
n
Ste
war
dsh
ip &
Gro
wth
Financial Statement View for
Operations Improvement
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Identified
Benchmark GAP
Recommended
FY 2015 Target
Budgeted FY
2015
Denials $ 1,827,860 $ 913,930 $ -
Clinical Documentation $ 1,500,000 $ 1,500,000 $ 1,500,000
Patient Statusing $ 1,667,858 $ 833,929 $ -
LOS $ 7,343,913 $ 3,857,295 $ -
Facility Metrics: $ 900,000 $ 900,000 $ 900,000
OR Supply Cost/Case $ 2,500,000 $ 2,500,000 $ 2,500,000
TOTAL $ 15,739,632 $ 10,505,155 $ 4,900,000
Care Coordination/
Revenue Cycle
Care Coordination/
Clinical
Productivity
Supply Chain
Benchmarking Prioritizes Projects and Resources
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Prioritize using sequencing and planned use of limited resources to focus and align resources and obtain greater benefits quicker.
BMCS Tied Priorities to Financial Targets
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Rev Cycle
Utilization
Productivity
Denials
Patient Status
ED LOS
Supply Chain
Psych LOS
Acute LOS
Clin Doc
Prioritize & Plan
JuneJuly
TBD
TBD
$0.9M
$0.9
$1.8M
$1.2M
$2.5M
Dec Jan Feb Mar Apr MayAug Sept Oct Nov
$0.4M
$2.2M
$1.5M
• It’s a bold new world for CFOs
• Your role directs future success more than ever
• You have the power to help lead your hospital to the next level of performance
• Transformation is not elusive
• Improve performance through operations, not cost cutting
• The right people, processes and technology provide the benchmarks that measure and predict financial performance.
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Taking Action Now