The trends of reducing costs and improving outcomes show no sign of receding, and new models for delivering health care are only adding pressure to traditional brick and mortar facilities. “Many providers are not looking for disruption or for a huge technology solution,” Jo Smith, EY Global Performance Optimization Implementation Lead, said. “They want to know, how do we deliver health care that is effective, efficient, and better for patients?”
What is performance optimization?
Performance optimization is a systematic effort to methodically examine every process, procedure and patient interface within an organization with the goal of identifying and eliminating waste and inefficiency. The work is critically needed, as health funding will likely never meet demand – whether the health system is public or private – and demand grows ever larger due to aging populations, and, in some regions, a burgeoning middle class.
Traditional performance improvement is narrowly focused on cutting costs. A performance optimization project, on the other hand, seeks to eliminate unwarranted internal variation in financial, administrative and clinical activities; improve the efficiency of performing tasks; and maintain or improve care delivery. Optimization projects undertake a deep analysis of all activities – both in the back office and care delivery – to map and route the most optimal activity or workflow.
Who benefits from performance optimization?
A performance optimization analysis helps organizations in almost every type of health care system around the globe. In mature economies, providers are focusing on technology and motivating behavior change. In emerging markets, countries are looking to leverage best practices as they build their health care organizations from top to bottom – looking to prevent mistakes from the start, building in the processes and behaviors to achieve sustainability. In the US alone it is estimated health systems are wasting up to 25% of results – in people, supplies and equipment, real estate, and processes. The World Health Organization puts this estimate between 20 and 40% globally.
Behavioral change or reform
Standardizing any activity requires the acceptance and commitment to change from the people executing the activity. Performance optimization projects are beginning to tackle the human aspect of change in order to further improve performance. This is a profound shift from process and procedures toward a focus on change management and human resources.
In addition to adding costs, variance in behavior is likely to result in a negative or uncertain patient experience. This won’t be a surprise to any hospital striving to become a High Reliability Organization (HRO), which relies wholly on people changing their practices to achieve better results for patients. Designed for organizations operating in complex environments where there is a perpetual risk for failure, an HRO shifts focus from the process to the outcome, with the goal of eliminating error.
Leverage the leaders
One added change management challenge in health care is overcoming the almost ingrained perception and role of the physician being at the center. One way to overcome this challenge is to leverage it. “Using the ‘champions’ model is key in health care,” Sarah Chang, Senior Consultant, People Advisory Services, Ernst & Young LLP, said. “Leaders in the true sense of the word are people who set the tone even if these individuals are not technically in organizational leadership positions. Identify them, engage in a meaningful way, and tap into their social capital. People will follow individuals they trust.”
Walk the walk – and measure success
Aligning every action with the principles and values of the organization – such as patient centricity – is critical to success. “Harp on this and really carry it out,” Chang said. “Every change must be tangible and directly tied to the goal. People will rapidly disconnect if words do not support actions or vice versa.”
It also pays to identify the measures of success in advance of any change or performance optimization initiative. With successful performance optimization projects, health organizations are establishing tangible measures over a specific period of time, and are tying compensation to results. The trend toward a variable compensation package – base pay plus bonus dependent on a specific set of performance metrics – is becoming the norm for leaders, physicians and other health professionals.