The New York Times profiled a university hospital in Utah that’s tracking costs and benefits of everything they do. It’s classic Industrial Engineering (my college major), but whenever you see these kinds of articles people act like it’s revolutionary.
It is amazing what tracking and data analysis can accomplish, but it’s not revolutionary.
And unfortunately, most hospitals have long considered their Industrial Engineer’s “non-essential” staff; I was warned about working in such an environment when I was in school, because a non-medical employee is the first to get cut when budgets are tight.
But now, thanks to a project Dr. Lee set in motion after that initial query several years ago, the hospital is getting answers, information that is not only saving money but also improving care.
The effort is attracting the attention of institutions from Harvard to the Mayo Clinic. The secretary of health and human services, Sylvia Mathews Burwell, visited last month to see the results. While costs at other academic medical centers in the area have increased an average of 2.9 percent a year over the past few years, the University of Utah’s have declined by 0.5 percent a year. “We have bent the cost curve,” Dr. Lee said.
A combination of programming, common sense, and guidance from medical professionals, some pretty incredible gains can be made. As an example, a few years ago, people said tests weren’t the big waste some were politicizing them to be:
With their new computer program, executives at the Utah hospital are also finding some simple ways to improve outcomes and reduce costs.
When internal medicine doctors looked at their costs per day, they were stunned to see how much they were spending on lab tests. Each was cheap, $10 or $20, but the total bill came to about $2 million a year.
Studies have found that 20 percent to 50 percent of hospital lab tests were completely unnecessary, ordered by residents with no questions asked. Most insurers were paying a lump sum for patients’ treatment so the cost for extra tests was borne by the hospital. Patients were getting so many blood tests that some became anemic.
The Utah doctors decided to require residents to justify each lab test. Orders plummeted. The hospital saved $200,000 a year.
That’s one efficiency gain, with no quality of care consequences, from one hospital.
Some were skeptical the program would make a difference, Dr. Bull said. But costs fell by 30 percent because patients spent less time in the hospital and had fewer complications. Letting nurses initiate treatment meant patients got needed medications faster, and the emphasis on “perfect care” meant the most important things got done.
“When I first started working in health care, like everybody I thought: ‘Oh, my God. It’s such a tough problem,’ ” Dr. Porter, the Harvard economist, said.
Now he has changed his mind. “I have no doubt we can solve it,” he said. “We know exactly what we have to do.”
It’s good to see this is happening in one or two hospitals, but it’s time to get serious about making high quality care more efficient across the country.