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Improving Efficiency and Performance

By Don Sadler

Surgical services are a key component of revenue for hospitals today. At better performing hospitals, 68 percent of revenue comes from surgery. In other words, the financial success of most hospitals depends on the smooth operation of the OR. Given this, it’s kind of surprising that surgical services has undergone very little operational change in over a century. Hospitals that want to improve financially need to take a hard look at their processes and procedures in an effort to boost overall efficiency and performance.


Antiquated Processes Lead to Inefficiency

“The surgical processes typically followed tend to be very antiquated,” says Jeffry Peters, the CEO of Surgical Directions in Chicago, Illinois. He offers an example of this and the resulting inefficiency.

“Patients are interviewed by a nurse prior to surgery and then asked the same questions again by the anesthesiologist and surgeon,” says Peters. “That’s three different patient interviews because OR staff aren’t talking to each other.”

Peters notes that the vast majority of procedures today are ambulatory surgeries.

“So the ability to perform ambulatory surgeries in a quality and efficient manner is critical to the success of health care organizations,” he says.

Jan Davidson, MSN, RN, CNOR, CASC, the director of the Ambulatory Surgery Division of the Association of periOperative Registered Nurses (AORN), says that ASCs are efficient by nature.
“If they weren’t, they wouldn’t stay open,” she says. Davidson says the Centers for Medicare & Medicaid Services (CMS) is considering removing total knee arthroplasty and total or partial hip arthroplasty from the inpatient-only list of procedures approved for reimbursement. This would result in even more total joint replacements being performed in ambulatory surgeries.

“However, many third-party payers are already reimbursing ASCs for these and facilities have shown to have excellent clinical outcomes,” she adds.

Optimizing Patients Before Surgery

One of the keys to increasing efficiency in hospitals, says Peters, is planning well in advance for surgical procedures and optimizing patients before surgery.

“For example, there should be a pre-anesthesia process where you talk to patients to find out about all of their comorbidities, such as diabetes and hypertension, so these can be managed prior to surgery,” he says. “If you don’t, this will result in surgical delays.”

Peters also recommends a daily huddle between nursing and anesthesia personnel to review all patients and procedures days before surgeries are scheduled.

“The most efficient health care organizations track metrics like on-time first case starts, same-day cancellations and turnover time,” adds Peters. “They implement initiatives to improve these metrics, which increases efficiency and helps drive better performance.”

“Profitability is linked hand-in-hand with efficiency, performance and patient outcomes,” adds Davidson. “In an ASC, profit is based solely on surgical volume and an equitable reimbursement from third-party payers. Greater efficiency equates to more volume.”

The Value vs. Volume Equation

According to Peters, value is now replacing volume as the key buzzword in hospitals as payers base a portion of payment on achieving positive clinical outcomes. He notes that CMS will require that half of payments be value-based by 2018.

“Health care organizations are penalized for things like high readmission rates, surgical site infections and the like,” he says. “Simply put, you’re not going to get all the money you should if you don’t have good outcomes.”

“Value-based reimbursements is a win-win for everyone: the patient, the health care provider and the third-party payer,” says Davidson.

Peters lists a number of common characteristics shared by successful health care systems’ perioperative services:

  • A collaborative governance structure
  • The sharing of transparent and comprehensive information
  • Engaged involvement by surgeons, nurses and administrative leadership
  • A focus on new and innovative models to deliver care, such as surgical home and bundled payments
  • Implementation of processes to enhance OR efficiency, such as faster turnover times, on-time case starts and shorter case times
  • Lower overall costs
  • An uncompromised focus on achieving clinical excellence

Peters recommends forming a surgical services executive committee to help ensure collaborative governance. The committee should consist of representatives from surgical, perioperative nursing and anesthesia leadership, as well as senior leadership of the health care organization.

“Surgery is a team, not an individual, sport so you have to get everybody on the same page,” says Peters. “This perioperative governing body will help align incentives and serve as an operating committee for all aspects of perioperative services.”

Nudging Surgeons to Better Performance

Of course, surgeons play a big part in improving OR efficiency and performance. Andi Dewes, the chief nursing officer at Syus Inc., in Nashville, Tennessee, says there are a number of things health care organizations can do to help nudge surgeons toward better performance.

“Surgeons make lots of choices that affect efficiency,” says Dewes. “For example, will they show up on time and schedule their cases in block? Or, will they minimize elective add-ons and use on-contract implants?

“If they don’t, it’s a conscious choice they make,” she adds. “So the goal should be to design choices that alter surgeons’ behavior in a predictably positive way without forbidding any safe options or significantly altering surgeons’ economic incentives.”

Dewes lists a number of predictable mental biases that often affect the decisions and choices surgeons make. One of these is what she calls anchoring, which is a bias toward the initial piece of information we are given. All other judgments are then made by adjusting away from this “anchor.”

“In the OR, anchors are things like eight-hour blocks, a 10-minute grace period for late starts or a 90-minute window for cases,” she explains. “Let surgeons set their own anchors – such as by setting their own targets or goals – and then nudge them in this direction.”

Another mental bias mentioned by Dewes is availability, which is a tendency to overestimate the likelihood of events that have happened most recently or carry the most emotional weight.

“For example, maybe an instrument was missing during a surgery yesterday which caused the procedure to run late,” Dewes explains. “So the surgeon thinks that missing instruments are a big problem, when in reality this happens very infrequently.”

The key to combatting this bias is providing surgeons with updated and current information regarding the actual probabilities of certain events.

“Regularly highlight information that may challenge their established beliefs,” says Dewes. “Be attentive to outliers, but don’t give them more attention than they deserve.”

Yet another mental bias common among surgeons is loss aversion. This is the human tendency to prefer avoiding losses (by a factor of at least two to one) to acquiring gains.

“In the OR, this might take the form of threats or negative language toward surgeons about losing block,” says Dewes.

“Surgeons don’t tend to respond well when threatened,” she adds. “Instead of communicating with surgeons punitively, speak with them using positive language emphasizing the community of surgeons, staff and the administration working together collaboratively.”

All Down the Surgical Services Line

Peters says that hospitals are looking to OR leadership to improve management of the surgical services line financially, operationally and clinically.

“Your goal should be to be viewed as the health care provider of choice for meeting both patients’ and surgeons’ needs,” he says. “Improving efficiency and performance is the key to accomplishing this.”



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