Let’s state the obvious: profitably managing a hospital is not for the faint of heart. With unabated regulatory reporting requirements, constant reimbursement pressures, increasing costs, deployment of complex information systems, recruitment and engagement of physicians and implementation of zero-harm cultures, hospital executives have a full plate. If you are indeed profitably succeeding on this journey, you possess both a fair understanding of your value chain and its key drivers, as well as demonstrating a tremendous amount of courage!

Reflecting on your value chain for a moment – and fully appreciating that it is not static – ask yourself whether your current resources are working on the highest value-add activities, and whether those activities are reflective of your core competencies. In other words, are there suppliers who would be more effective at managing certain non-core competencies than the ones you are using? 

It is imperative for hospital executives to dissect their business value chain continuously and ruthlessly. Then they must determine whether replacing part of that value chain with a supplier through outsourcing would yield improved and higher-quality patient care while lowering costs through improved efficiencies. 

Over the years, our industry has witnessed the evolution of such suppliers including those that manage hospital information technology departments, radiology reading services and revenue cycle management, to name a few. The evolution of these companies means that healthcare executives are indeed asking the right questions and realizing that such suppliers embedded into their value chain can yield improved performance, lowered costs and the redistribution of internal resources to higher-value activities.

Quality Measures Abstraction

A developing case in point is quality measures abstraction and reporting outsourcing. With the onset of the inpatient quality reporting requirements by the Centers for Medicare and Medicaid Services (CMS) in 2003 through the proliferation of quality measures over the past decade – including the most recent passage of quality reporting requirements for long-term acute care and home health facilities – quality measures continue with a momentum that is increasing.

Additionally, these dynamic and changing measures, which also have penetrated into both state requirements and commercial plans, have significant reimbursement impact when quality targets are not met – it is greater than 10 percent in the case of Medicare reimbursement!

Generally speaking, quality measures abstraction and reporting falls into the domain of the quality department, which also is responsible for quality improvement. As is commonly the case, a process improvement (PI) quality specialist is responsible for not only improving hospital quality, but also abstracting and aggregating the data necessary to do their job.

In other words, according to a hospital chief quality officer (CQO) I recently spoke with, they are spending too much time with their “nose in the charts.” When that happens, they are not on the floor working with physicians and other clinicians attempting to improve quality. Thus, again the CQO said, “They are not working at the top of their license.” In other words, they are working on activities that are non-core and lower value to their primary focus. Consequently, they have less time to focus on that which adds greater value to the hospital – improving quality and performance.

Not working on top-of-license activities has another implication – employee morale and motivation – which further requires healthcare executives to ensure their employees are working on the right things. We see this reality in infection control, another sub-domain within the quality department. 

Infection Prevention

If you go ask your hospital quality department on how easy it is to find and retain good infection preventionists (IP) in today’s market, their immediate response will be to tell you of the difficulties they face. The demand is high in light of CMS penalties associated with hospital-acquired conditions. The CMS reporting requirements (via the National Healthcare Safety Network) have placed a greater demand on IPs to gather data and validate whether the infection was acquired in a hospital or not.

Their training is to work on reducing infections. They are trained to work hand-in-hand with physicians and other clinicians, on the floor, educating and preventing future infections. By having to spend more time in data abstraction and paperwork, they are less effective in their role, frustrated and demotivated, thereby yielding high turnover.

Delivering safe, consistent and affordable healthcare is not easy. It is, however, what your core competency must be to compete in today’s market. Thus, it requires constant and diligent review of what and where your employees are spending their time. If they are not at the front of the line, working directly with patients as they should be, it’s time to take action and ensure your value chain remains competitive by delivering safer and higher quality care at lower costs.

Milton Silva-Craig is the CEO of Q-Centrix LLC, a provider of outsourced retrospective and concurrent core measure and registry data abstraction for acute care hospitals. With more than 20 years of experience in the healthcare and information technology industries, Silva-Craig has led and managed high-growth businesses and institutions. Q-Centrix was welcomed into Sterling Partners’ healthcare services portfolio in December 2013. For more information, visit q-centrix.com.

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