AveraOpEx - A Moral Imperative for Change in Health Care
As costs escalate and insurance reimbursements lag, hospitals and patients alike are asking the same question: "Will health care be accessible and affordable in the future?"
If the answer is to be "yes," there's a moral imperative for health care organizations to streamline processes and eliminate waste, said Fred Slunecka, regional president of Avera McKennan Hospital & University Health Center in Sioux Falls, S.D.
"Thirty to 40 percent of all health care is waste - pure and simple. I believe what we're doing in America is morally wrong," Slunecka said. "While American industry has achieved a 3 percent productivity improvement every year since 1980, health care has lost productivity of 2 percent per year over that same period of time. There is not an industry in this world that's allowed to do that indefinitely."
Avera McKennan has found a workable solution in implementing the techniques and principles of the Toyota Production System, known as LEAN. Since beginning LEAN projects in 2004, Avera McKennan has saved millions of dollars in construction costs, human resources and supply expense.
"These projects save money, improve quality and improve patient satisfaction. Employees get behind it because they see the end point - the patient," Slunecka said.
Through LEAN teams made up of the front-line staff, employees themselves actually design change, and thus own change.
"LEAN is about examining - step by step - what's going on with the patient and redesigning the process around the patient to eliminate waste. LEAN involves employees in the solution at the most grass-roots level," Slunecka said. LEAN principles focus on eliminating or minimizing non-value added activities such as waiting, transporting or dealing with inventory.
It's a transforming, empowering experience for employees, said Slunecka, giving the example of Rod, a member of the maintenance staff, who was placed on a LEAN team to move equipment and relocate wires as needed. "Rod is now Leonardo da Vinci. He has designed some of the coolest, innovative and interesting devices and gizmos to improve efficiency. Dozens of people will rise up and surprise you with their hidden talents, and it's rewarding to see that."Communication is a major key to LEAN success.
"Health care is so interactive. You must create an awareness across the board," Slunecka said. What affects the lab affects nursing, and what affects nursing affects housekeeping and so on.
The drastic changes of LEAN challenge employees and managers alike. It's key to support employees through the process, but to be uncompromising toward the end goal. "We have to make sure that what we're doing is ultimately for the highest purpose, and that's to make sure our health care is affordable for the people we serve," Slunecka said.
In the laboratory at Avera McKennan LEAN resulted in a productivity improvement of 14 percent, improved space utilization of 1,000 square feet, inventory savings of 15 percent, and an increased capacity of 75 percent, giving the lab the ability to increase test volumes without adding FTEs. With these changes came a savings of $600,000 per year.
LEAN has also resulted in cost avoidance in multiple areas. It was possible to cut $1.25 million in construction costs for Avera McKennan's new Emergency Department when it was found that only 20 of the proposed 24 rooms were needed. At the Avera Behavioral Health Center a project saved $64,000 by implementing standard work and redesigning workstation layout in pharmacy instead of purchasing a second Pyxsis machine to meet Joint Commission standards.
Nursing unit hours per patient day have steadily declined as a result of LEAN initiatives from 14.08 in FY 2005 to 13.12 in FY 2008.
The initiative has also extended into clinics where four additional patient schedule blocks have been added per day per provider four days a week, without interfering with the time the provider spends with the patient.
Avera McKennan and OpEx Inc., the company guiding the hospital's LEAN implementations, have teamed up to form AveraOpEx, a consulting team to help other health care organizations achieve similar successes.
