How to bring down hospital costs

April 03, 2011

In "Obama's health care reform is unhealthy for hospitals" (March 19), the author states that health reform's focus on the need for hospitals to increase productivity is misguided and difficult to achieve. That statement is incorrect. Based on our experience, the use of advanced-process engineering methodology with real-time logistics technology has been shown to significantly reduce hospital costs while improving quality.

For many years, the best hospital systems have shown that principles developed to increase the efficiency of production processes can also be applied to hospitals. Recently, new approaches combined with advances in health information technologies have helped make huge leaps in hospital efficiency. In the last 18 months we have helped eight hospitals save more than $40 million without significant reductions in their work force. When one considers there are more than 5,000 hospitals in the country, widespread adoption of total hospital efficiency could generate huge savings to help them survive in an environment of constrained reimbursements.

Discussing production methodologies, efficiency, or patient throughput when families want to talk about diagnosis, treatment and recovery may seem incongruous. But by increasing the efficiency of hospitals, we remove the logistical challenges that confront doctors and nurses on a daily basis. In doing so, clinicians have more time to spend with the patients they treat. In the future, providers that stress total hospital efficiency will combine advanced methodologies and technologies with how hospitals are designed to further reduce costs and improve quality of care.

While the debate around the size and scope of health care reform will continue, it is clear that by utilizing principles widely applied in other industries providers can have an immediate and lasting impact on health care cost, quality and patient satisfaction.

Karl Straub

The writer is president of CareLogistics, a Georgia-based hospital services company.

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