September 2005, In This Issue:

LEAN Healthcare Successes

Beginning with this issue, HPCI is featuring successes using Leann in the health sector. Numerous health providers in Iowa and elsewhere are now engaged in the Lean transformation with great results. Iowa successes will be featured along with others. Congratulations to all engaged in the Lean journey.

Central-line Infections: The Pittsburg Consortium has posted a 55% region-wide reduction in the number of central-line associated bloodstream infections, a very significant regional decline. Their goal is zero CLABs. The CLAB rate was reduced from 4.2 per 1000 line days during the 3rd quarter 2001 to 1.9 during the 2nd quarter 2004. These devastating infections typically affect patients who are already very sick, and result in death about half of the time.

In a notable example, CLAB rates were quickly driven to new lows at Allegheny General Hospital’s Medical Intensive Care Unit and Coronary Care Unit. Using principles of the Perfecting Patient Care System taught in Pittsburgh Regional Health Care Initiative’s University, the whole staff drove the rate to zero within 90 days and has held it near zero for a year.

Hospital Pharmacy: Through the application of TPS, Community Medical Center in Missoula, MT, identified the root cause of missing medication phone calls and implemented counter measures to prevent re-occurrence. This resulted in a 40% decrease in missing medication notifications over a one-month period from 24 per day to 14 per day on average.

Medication Distribution Time: The Appleton Medical Center’s Medical/Surgical Unit (part of ThedaCare Appleton, WI) decreased medication distribution time from 15 minutes per med pass to 8 minutes per med pass impacting 4.1 FTE’s of staff time.

Prep Time for Chemotherapy: Reduced prep time for chemotherapy at Virginia Mason Medical Center from three hours to less than one hour. The new process also cut four hours off of the patient treatment day.

Acute Patient Flow Through Clinic: Unity Health Care System in Muscatine achieved a 50% reduction in steps required to book a urgent/acute care appointment from 4 to 2; reduced patient lead time for acute care processing by 22-37% (depending on the condition); established standard operation for scheduling function 100% of the time; and improved by 10% the ratio of contact time with health care providers to total lead time for a visit from 33.8% to 37.4%.

CT Scanner Throughput: University of Iowa Hospitals and Clinics reduced command center calls by 30% (60 fewer calls); increased patient throughput capability by 31% from 64 to 84 pts/day; eliminated two week backlog in the first two weeks following the improvement event; total scan cycle time reduced by nine minutes (30%) from :30 to :21; patient (lead time) experience reduced by 33% from 1:54 to 1:16 hours; travel distance-tech reduced by 91% from 510 ft to 45 ft; and travel distance-prep reduced by 50% from 600 ft to 300 ft.


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Lean Healthcare West Comes to Iowa

Cindy Jimmerson, the Founder of Lean Healthcare West, recently spent several days in Iowa. She received a very positive reception and a strong level of interest from hospital representatives and other health professionals who heard her message. Jimmerson spoke to a standing room only crowd at the Indian Hills Community College in Ottumwa and to a statewide audience through the ICN network. She discussed how Lean is successfully being used in healthcare to eliminate waste, improve quality, reduce cost, and enhance customer satisfaction.

Through One Source, the educational programs and services of Lean Healthcare West will now be available across Iowa through the 15 Community Colleges.

Using principles from the Toyota Production System (TPS) and her healthcare experience, Jimmerson published REVIEW (Realizing Exceptional Value in Everyday Work). It contains the concept of ideal.

Foremost in the Toyota success story is their dedication to creating an ideal state. The philosophy of seeing “how close to an ideal we can get” is a strong motivation for improving work activities.


  • Exactly what the patient needs, Defect Free!
  • One by One, customized to each individual patient
  • On Demand, exactly as requested
  • Immediate response to problems or changes
  • No Waste
  • Safe for patients, staff and clinicians: Physically, Emotionally, & Professionally

Bowen/Spear, “Decoding the DNA of the Toyota Production System” HBR 1999


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The Impact of Lean Principles in Industry

When applied rigorously and throughout an entire organization, Lean principles can have a dramatic affect on productivity, cost and quality. Some statistics that testify to the power of Lean thinking in industry are shown below. “There is no a priori reason why much of this same effect can’t be realized in healthcare,” according to the Institute for Quality Improvement (IHCI).

Validated Industry Averages*

Direct Labor/Productivity Improved 45-75%
Cost Reduced 25-55%
Throughput/Flow Increased 60-90%
Quality (Defects/Scrap) Reduced 50-90%
Inventory Reduced 60-90%
Space Reduced 35-50%
Lead Time Reduced 50-90%

*Summarized results, subsequent to a five-year evaluation from numerous companies (more than15 aerospace-related). Companies ranged from 1 to 7 years in Lean principles application/execution.

Source: Virginia Mason Medical Center

The IHCI reports agreement is growing among health care leaders that Lean principles can reduce the waste that is pervasive in the U.S. health care system. The Institute believes that adoption of Lean management strategies – while not a simple task – can help health care organizations improve processes and outcomes, reduce cost, and increase satisfaction among patients, providers and staff.


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Broadening the Circle of Health Provider Performance Reporting

Transparency of health provider performance has proven to be an important catalyst for improvement in health care. Public reporting of comparative information also assists consumers, patients and purchaser’s decisions regarding where to get the best care.

HPCI continues to encourage health care providers in the greater Iowa market area to report to the Leapfrog Group - informing choice, rewarding excellence and getting health care right. Other performance measurement and reporting are also important. These include the Centers for Medicare and Medicaid Services (CMS) performance measures. The Consumer Purchaser Alliance has developed guidelines for purchasers, consumers and health plan measurement of provider performance. They are:

  • Scientifically–valid performance measures endorsed by the National Quality Forum’s consensus process: The National Quality Forum’s (NQF) performance indicators should serve as primary measures. If NQF has not endorsed a measure for an aspect of health care performance, measures endorsed by national accrediting organizations should be used. If supplemental measures are implemented, they must be scientifically grounded, regularly updated and reviewed by provider and consumer groups.
  • Transparency of Provider Rating Methods: Provider rating methods, including detailed measurement specifications and algorithms used to combine scores and/or group providers into performance tiers, should be publicly disclosed.
  • Coordinated Data Collection: If collection of data about performance creates a significant burden for providers, data collection should be coordinated across health plans and other purchasers who share hospitals and physicians within their contracted networks.

The Consumer Purchaser Alliance is made up of many premier groups and organizations including individual businesses and corporations, health coalitions like HPCI, The Business Roundtable, American Benefits Council, AARP, AFL-CIO, ERISA Industry Committee, International Association of Machinists and Aerospace Workers, The Manufacturing Institute, March of Dimes, National Association of Manufacturers, National Breast Cancer Coalition, National Coalition for Cancer Survivorship, National Partnership for Women and Families, National Small Business Association, The Robert Wood Johnson Foundation, U.S. Chamber of Commerce, and United States Office of Personnel Management. More information can be found at www.healthcaredisclosure.org.

Collaboration and trust between providers, health plans, purchasers and consumers of health care is important. HPCI seeks to achieve these positive working relationships.


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Greater Iowa Consumers’ Health Care Guide

The prototype of the Consumers’ Health Care Guide for Greater Iowa is available for review and consideration. It will be the first in a series of Guides to provide information on health care provider performance, prevention/lifestyle, and other information to help members and their families make better health care choices and to improve their overall health status. The primary audience will be members of HPCI and the Iowa Health Buyers Alliance who, in turn, will use their internal distribution channels to reach consumers, patients and families across the state and bordering communities.

At this time members are being asked to: 1) review this prototype as to its contents and usefulness to you and your organization and 2) consider how your organization might use and distribute this Guide to reach your members/employees and their families.

Once finalized, we invite and hope you will distribute the Guide using your internal distribution methods in order to reach all of your members/employees and their families. For example, you may want to use the Guide as part of your health insurance annual open enrollment process or broadly distribute it throughout your organization in other ways. The finalized Guide will be available to you in an electronic format or you may choose to print the Guide customizing it to your organization by adding your name, logo, and message.

Please contact the HPCI office for additional information.


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2005 Hospital Ratings Posted; Participation in Leapfrog Survey up from 2004

The Leapfrog Group recently announced a dramatic increase over last year in first round submission to the 2005 Leapfrog Hospital Quality and Safety Survey (version 3.1). As of July 1, the number of survey responses represents an increase of 23.5% over the same time last year. Hospitals can continue to submit throughout the year, the first wave included 933 hospitals and Leapfrog Central anticipates a significant increase in total participation for the year over last year’s of 1,112 hospitals.

The survey provides consumers and purchasers of health care with the information they can use to make informed health care choices and is based upon the National Quality Forum (NQF) Safe Practices. As the NQF’s Safe Practices Maintenance Committee proceeds with a new version of the Safe Practices, the Leapfrog Group commits to continuing to align with NQF.

Any hospital in the U.S. is welcome to complete the Leapfrog Hospital Quality and Safety Survey. While the survey is more applicable to urban-acute hospitals, one section – the Leapfrog Safe Practices Score – is applicable to both urban and rural hospitals.

The survey data is publicly displayed on the Leapfrog Group Website: www.leapfroggroup.org

HPCI encourages hospitals, especially urban hospitals, in the greater Iowa area to report to the Leapfrog Group.


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Ten Cost Containment Strategies

Employers are using numerous strategies to contain rising healthcare costs. Among them are the following:

  1. Redesign prescription drug programs – from flat co-pay to percentage of cost co-pay; requiring use of generic drugs when available; use of only mail order for maintenance drugs; require pre-authorization of all injectables.
  2. Redesign retiree medical programs – basing company’s premium contribution for future retirees on service and age; scaling back retirement benefits for new hires; redesign the prescription drug plan for over-65 retirees to supplement the Medicare prescription benefit.
  3. Actively manage employee health – offer employees incentives for staying or becoming healthy by actively employing health-related interventions and communications; better employee self-care and disease management.
  4. Consumer-driven health plans – reduce cost exposure and provide employees with more flexibility by implementing Health Reimbursement Accounts (HRA’s) and Health Savings Accounts (HSA’s). A typical consumer-driven health plan has a higher deductible ($1,000 single/$2,000 family or higher) and a health care savings account (HSA) with tax-free expenditures.
  5. Promote smart employee consumerism through communication – help employees understand their options and the associated costs and remind them of the importance of prevention and regular care.
  6. Negotiate with insurers – use bidding process in negotiations during carrier renewal.
  7. Evaluate funding effectiveness – considering the costs and benefits of being insured vs. self-insured; actively exploring pooling arrangements.
  8. Evaluate administrative effectiveness – consider outsourcing and electronic administration in conjunction with internal cost analysis.
  9. Consolidate plan offerings - limiting the number of plan types (e.g. PPO, HMO, POS) or the number of plans within each type.
  10. Ask employees to share the burden – increasing employee contributions towards premiums and co-pays.

Source: HayGroup and others.


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Aetna Posts Physician Fees Online for Health Plan Members

Aetna will make information available to members on the exact prices it has negotiated with in-network doctors in the Cincinnati area, the Wall Street Journal reports. Aetna, which hopes to provide patients with the tools needed to comparison shop for services and make smarter decisions about health care spending, is the first major health insurer to publicly disclose the fees it negotiated with physicians. Aetna will provide pricing information on 600 of the most common medical services provided by primary care doctors and specialists in its network in Cincinnati and parts of southeast Indiana, northern Kentucky and Dayton, Ohio. The information will be accessible by any Aetna member who goes to the insurers’ web site. Aetna ultimately hopes to expand the program nationwide, and some experts say the move could prompt other insurers to “follow suite, which in turn would give a significant boost to consumer-driven health plans,” the Journal reports.


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