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To combat rising costs, healthcare providers across the care continuum are focusing on efficiency and working to embed it into patient care and business practices. In doing so, many healthcare organizations are learning that sometimes the best way to drive efficiency is by improving quality.

The U.S. healthcare system has earned lackluster quality and cost grades in comparison to other developed countries. In fact:

  • Research from the Commonwealth Fund shows that prices for health services are considerably higher in the U.S. than elsewhere. For example, an average heart bypass surgery in the United States costs $75,345 and only $15,742 in the Netherlands.
  • The U.S. spends more than $2.8 trillion on healthcare each year, with some estimates putting 2016 costs above $3 trillion. As much as 30% of that is estimated to be waste.
  • The U.S. Bureau of Labor Statistics says the average American household pays $4,379 in healthcare costs per year.
  • The total cost of healthcare for the average family of four covered by a typical employer-sponsored health plan will exceed $25,000 in 2016.
  • The CDC reports that approximately eighty-six percent of all health care spending is for people with one or more chronic medical conditions.

OpEff-Healthcare-Costs.pngAlthough healthcare spending is higher in the U.S. than in many other countries, the United States does not lead its peers in clinical outcomes. For the U.S., improving efficiency and outcomes are both priorities that need to happen in tandem. To successfully deliver value-based care, organizations have to make sure everyone is going in the right direction doing things that are aligned with business and customer needs.

Everywhere we look there is a new initiative being tossed at healthcare. You can’t do everything. Is your organization focused on the “right” things?  This is your strategic plan based on leadership direction and customer needs. If you’re focused on doing the right things, the next question to ask yourself is: Are you doing the right things well consistently?

You must be continuously reviewing internal processes, and becoming more aware of what you are doing and where you are headed. The key word being “continuous”. You may be a work in progress or far into your quality improvement initiatives, but the bottom line is—never stop working at it. This is a true culture change that will take time, so why not start today?  You want to start using proven best practices for practice tranOpEff-heart-surgery-costs.pngsformation.

For example, a number of high-performing healthcare organizations are integrating the Baldrige Criteria for Performance Excellence to achieve sustainable results. The Baldrige framework is accepted around the world as the gold standard for organizational performance excellence.

Read "The Gold Standard: How Businesses Can Achieve Performance Excellence."

One of the ways healthcare organizations can propel both quality and efficiency is by adopting the Baldrige framework.

At Primaris, we recommend the Baldrige principles because of how they can be applied to virtually any healthcare organization and used as an outline for managing improvement. The criteria for meeting Baldrige Performance Excellence covers these areas:

  • Leadership
  • Strategy
  • Customers (patients)
  • Measurement, analysis and knowledge management
  • Workforce
  • Operations
  • Results

High performing organizations will align these processes with their mission and integrate them to improve performance. Often in business there is a direct relationship between quality and efficiency, and the same is true in healthcare. In order to increase efficiency, actions must be taken to improve quality. Therefore, quality should be at the forefront of every efficiency discussion.

The bottom line is that all healthcare organizations should strive to be as efficient as possible for their own benefit and for the benefit of patients. Providing optimal patient care – taking proper care of patients and doing things right the first time – is always most efficient. Rework is wasteful. Medical errors are costly. When quality is achieved, efficiency is a side effect.

Operational Efficiency White Paper


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