LEAN for Healthcare – The Answer to the Funding Crisis

The US hospital system is faced with financial pressures that will have a profound effect on the abilities of hospitals to provide quality care for their patients. Value based purchasing will have an effect on Medicare and Medicaid reimbursements to hospitals later this year. Reimbursement for Medicare and Medicaid patients will be based on HCAHPS scores that will result in decreased reimbursements if scores are below the national average. This will put up to 5% of reimbursements at risk for hospitals who do not meet the minimum standard.

The current debt crisis in the United States will have a profound impact on Medicare reimbursement to providers. In the August 15, 2011 edition of Time magazine reports that by late November, a congressional committee must agree to at least $1.2 trillion in additional cuts. If the committee fails or if the plan is not signed into law $1.2 trillion will automatically be cut divided between defense and Medicare providers beginning in January of 2013. This means $500 billion will be clawed back.

How will hospitals absorb this cut in funding?

Simply by becoming LEAN organizations, where every person in the hospital is constantly looking for opportunities to eliminate waste and reduce costs. Some executives wonder if this is truly in alignment with LEAN principles. Reducing cost and making services more affordable is definitely listening to the voice of the customer, an underlying principle of lean. Eliminating waste is also totally alignment with this lean principle. There are many forms of waste in the hospital, one of them being the time that patients wait in the waiting rooms. If we can reduce wait times (waste for the customer) patient satisfaction scores will increase, we will have more time for our primary purpose, caring for people and because of increased efficiencies we are able to serve more people and hence have a corresponding increase in revenues.

An example of this on a small-scale happened in a hospital that I have worked with. Using LEAN tools, an analysis was done of the flow through the radiology department. The analysis was conducted by frontline staff who were trained in the principles and tools of lean. With some adjustments and rearranging, they were able to shave six minutes off each procedure time. This resulted in reduced waiting times for patients, increased patient satisfaction scores and the time to do several additional procedures each day. There was a positive financial impact to the bottom line of the hospital because of project.

Can you afford not to consider what LEAN in healthcare can do for your hospital?

What Others Have Said…

Michael developed a LEAN program for our hospital. This involved training both managers and front line staff in LEAN and its application in every department. Two LEAN projects were conducted in an effort to reduce inventory. There was a reduction of $135,000 in pharmacy inventory and $200,000 reduction in OR inventory."
Richard E. D’Alberto, FACHE
President & Chief Executive Officer
Laurens County Hospital

"Michael is a great speaker. He is inspirational and knows his trade."
Lynn Yarbrough
OR, JMRC

"Great quality- appreciate his openness to field question on the spot"
Rita Jones
CEO, Dundy County Hospital

"Michael is an outstanding, knowledgable speaker, keeps the flow going an involve the audience well."
Stephen Stewart
CEO, Artesian Valley Health System

"I like the process in implementation"
Brad Langdorf
VP Clinical Services, Community Hospital

“Michael is an excellent speaker. Content is exciting and educational.”
Mollie Heisel
Human Resource Coordinator
Brown County Regional Health Care
 
“Very good; usable; informative; real; encouraging”
Valerie Gigolyk
Supervisor
Loewen Windows

“Without your personality, coaching and spirit, we wouldn’t have made it so far.”
Ann Corrigan, RN
VP of Patient Services
Henry County Health Center

“We are utilizing the information on a regular basis. It has been exciting to see this growth.”
Pat Hales , Director of Quality and Educational Services Misericordia Health Center

“Excellent speaker- funny yet seriously important to improve our daily lives.”
Rebecca Ricartti, HR Director
Pacific Alliance Medical Center

“Michael is fantastic. Keeps the learning Entertaining and interesting.”
Stephen Stewart CEO
Artesian Valley Health System

“Great. Enjoyed the session.”
Curtis Hawkinson CEO
Community Memorial Healthcare

“Very clear and concise presentation. Always includes stories that make you think.”
Heather Greenwood, Med Tech
CHI St. Alexius Health

“Michael is a great presenter and presented he content in a manner that made it interesting and useful.”
Lynne Yarbrough, OR Director
Johnson Regional Medical Center

“Knowledgeable and energetic.”
Valerie Hangman, QI Coordinator
Providence Medical Center

I was impressed by the content and the clarity of the speaker.”
Jennifer Russell
Government of Manitoba

“Excellent quality, excellent information & keeps his agenda enthusiastic and timely.”
Terri Davis, RN
Providence Medical Center

“Dynamic speaker who leads the group to discover the answers for themselves.”
Jeff Dolan
Canada Cases Ltd.

“Mike is inspirational. A Great Motivator.”
Glen W. Buckler
President
Two Small Men with Big Hearts


“You have to see Michael Bayer’s presentation.”
Lois French

Investors Group

“Excellent speaker with an important message”
Rob Vineberg
Regional Director General
Citizenship & Immigration Canada

“Excellent speaker- funny yet seriously important to improve our daily lives.”
Rebecca Ricartti,
HR Director
Pacific Alliance Medical Center

“Fantastic! My cheeks hurt from laughing so much, yet I also gained so much knowledge too! Thanks!”
Daiva Griese
One Legacy

“Excellent, worthwhile. It was as good as it gets.”
Stephanie Bloodworth
Case Manager, New Directions

“Fantastic speaker. Great for any industry.”
Ron Farmer
Personal Banker, CIBC

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