Peer benchmarking could lead to the answer.
Tell us if this health system’s challenge sounds familiar: CHRISTUS Trinity Mother Frances Health System, located in Northeast Texas, was facing a staggering potential setback when a number of payer contracts changed. The difference amounted to a $25 million shortfall in their budget’s revenue.
The system’s first reaction might have been to issue an across-the-board expense reduction mandate to make up the budget difference. We all know that can happen a lot in the industry, but it doesn’t always produce the results healthcare organizations need, and quality of care can be impacted.
Instead, this system chose a data-driven, strategic savings approach as the path forward, with an eye on long-term financial independence from these types of shortfalls.
A look at the targeted expenses
Using a comprehensive comparative database, the system was able to benchmark costs, productivity and resource utilization against best-in-class facilities of similar size and demographics.
Leaders identified cost improvement opportunities in areas such as supply, labor costs, length of stay and purchased services — areas where the system was not at the same level as high-performing peers in terms of expenditures.
The benchmarking information from the database was also used as a call to action for staff to find methods of improving processes and cost management. CHRISTUS Trinity Mother Frances leaders formed teams and assigned financial targets. Teams then used the database to answer the question, “If another health system is able to keep supply costs at this level, what can we do to bring our costs to that level with no bearing on our patient care or satisfaction?” The health system also created a dedicated project management office to help guide the process. The results of these efforts (in box below) speak for themselves.
If you’d like more information on how the health system achieved this result, please reach out to us. You can also read the full case study here.
Your great-grandchildren will laugh when someone tells them that, not so long ago, all patients with the same diagnosis received the same treatment. They will say that would be similar to all people getting the same shoe regardless of the size of their feet.
The era of personalized medicine is emerging. Patients are beginning to receive different diagnostic tests and treatments based on their genetic makeup and metabolism. Expanding this to all patients will require the manipulation and study of big volumes of data, including genomic and proteomic mapping as well as the integration of near real time electronic medical information.
I celebrate that the National Institutes of Health are putting a fresh emphasis on health informatics. Biomedical computing will foster collaboration across medical disciplines, and there is little doubt that such efforts will bring forth unique insights and generate novel analytical tools. Truven Health Treatment Pathways is a first generation product of this movement. With it, we have the capability to conduct comparative effectiveness research in a real world setting using large populations in a matter of weeks instead of years.
As a treating physician, I have been struck by the nearly complete absence of information comparing treatment alternatives - most are approved against doing nothing rather than each other. By comparing treatment regimens and outcomes, not only will doctors and patients be better informed but health plans will be able to markedly advance the field of evidence based benefit design. For all of these reasons both public and private investment into medical big data should be endorsed and promoted.
Ray Fabius MD
Chief Medical Officer
We’re pleased to announce that the $1.25 billion sale of the Thomson Reuters Healthcare business to an affiliate of Veritas Capital was completed today. The company’s many well-known brands, established in more than 30 years of leadership in the healthcare industry, include Advantage Suite®, Action OI®, MarketScan®, 100 Top Hospitals®, CareDiscoveryTM and Micromedex®.
The newly independent company will be known as Truven Health Analytics, a name based on the words ‘truth’ and ‘proven’ that speaks to the strength of its offerings, expertise, and people.
Truven Health Analytics provides data, analytics and performance benchmarking solutions and services to hospitals, health systems, employers, health plans, government agencies and pharmaceutical companies. With leading assets and solutions coupled with expert services and analysis, Truven Health Analytics provides its customers with solutions to identify savings, improve outcomes, detect fraud, and more efficiently manage their healthcare operations.
Truven Health Analytics employs approximately 2,200 people worldwide and has its principal offices in Ann Arbor, Chicago and Denver.
We look forward to continuing to help you stay in tune with the issues affecting healthcare, along with our perspectives based on analysis of the data behind the trends.