Squeezing the fat from health care

Hospital finds that Lean Management improves efficiency and patient care

September 17, 2006|By Hanah Cho | Hanah Cho,Sun reporter

At St. Agnes Hospital in Baltimore, heart attack patients are receiving faster treatment.

Doctors, nurses and other hospital staff recently slashed by 22 percent the time it takes for an angioplasty to begin after the patient's arrival in the emergency room. Instead of 119 minutes, patients wait roughly 93 minutes. It's an important improvement, given studies that have linked faster treatment with a lower mortality rate, and the state requires 80 percent of patients to be treated within two hours.

To be more efficient, St. Agnes staff members are employing a practice known as Lean Management to cut costs, reduce patient waiting times and improve safety.

Perfected by automaker Toyota, Lean Management is among the variety of techniques promoted by consultants and used by corporate America in an effort to improve work flow and trim expenses. In recent years, Lean has reached hospitals such as St. Agnes and others as health care professionals have tried to contain rising medical costs.

"We're learning to see the waste and taking it out," said Bill Greskovich, St. Agnes' vice president of operations and chief information officer.

Workers may remember theories such as Total Quality Management, Six Sigma, re-engineering and other business techniques that use flow charts, problem solving and role playing to help make their organizations more effective.

Each theory was promoted as the latest "it" tool to cut waste and improve operations. For instance, Six Sigma was pioneered at Motorola and gained popularity in the 1990s when former General Electric Chief Executive Officer Jack Welch adopted the practice at the company. (Six Sigma is still part of GE's culture.)

Too trendy

But such management theories also have gained a reputation among some experts and workers for being too trendy or imposing cookie-cutter administration on workplaces.

Experts say such practices can work, but they should not be considered a cure-all.

In some cases, they fail because of poor implementation or lack of resources. In turn, workers get frustrated and fear job cuts as companies cycle through such management practices. Several hospitals, such as St. Agnes, do not lay off workers. Instead, workers are typically redeployed throughout the organization.

Lean Management tries to create the smoothest work flow possible by cutting unnecessary steps in work processes and using teamwork to identify and fix problems as they happen. Its roots date back to when Toyota and other Japanese companies learned many of the techniques from W. Edwards Deming, the late American statistician who worked in Japan after World War II.

The automaker transformed Deming's insights into its own. When Toyota became a manufacturing powerhouse in the United States in the 1980s, other companies followed its lead.

At other industries

Besides Toyota, about 36 percent of U.S. manufacturers identified Lean as their primary improvement method, according to the 2005 IndustryWeek/Manufacturing Performance Institute Census of Manufacturers. Those companies included DuPont and Alcoa.

DuPont, for instance, uses Lean and Six Sigma concepts, the company said. And U.S. Army Materiel Command, which develops weapon systems and maintains and provides equipment, said Lean has helped it increase productivity and lower costs.

The growing price tag for health care helped create a Lean wave among hospitals a few years ago.

But some health care management experts say that some hospitals - like corporations - have gone through numerous quality improvement methods, only to abandon them for the latest management program. As a result, the impact of such practices on hospital operations and patient satisfaction has been minimal, some experts say.

"You start doing it and you'll do it for a couple of years. If you don't see results, organizations drop it and go on to the next step," said Lawton R. Burns, director of University of Pennsylvania's Wharton Center for Health Management and Economics.

"The average U.S. corporation spends two years in Total Quality Management. The average Japanese firm spends 30 years. They take a much longer perspective. They invest the time and money to make it work. That's what's lacking in the U.S.," Burns said.

He added, "Hospital executives need to watch out and don't fall into those traps."

Some find success

Some hospitals, however, have found success in Lean, according to a 2005 report by the Institute for Healthcare Improvement, a nonprofit group in Cambridge, Mass.

In one case study, ThedaCare Inc., a Wisconsin-based health system with three hospitals, reported several positive results, including $3.3 million in savings in 2004.

Diane Miller, a director at the institute who edited the research paper, said other quality improvement methods have faded away in the past, but Lean's "early results are not just about costs, but really about driving the waste out and freeing staff to do good stuff."

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