HMC News•
on March 5th, 2010•
HMC finds Hospital-Acquired Infections and other problems budget busters
NEEDHAM, MASS. – March 8, 2010 – The Healthcare Management Council, Inc. (HMC) has found that by improving care to eliminate the off-quality treatment of patients, a 200-bed hospital can potentially save $2 million each year.
Using federal Agency for Healthcare Research and Quality (AHRQ) indicators, HMC has analyzed the performance of hundreds of facilities ranging in size from 75 beds to over 800 beds. Now in a recent study, HMC identified the top Hospital Acquired Conditions (HACs) and established how much extra care each of these HACs requires. HACs have resulted in nonpayment from Medicare and Medicaid, and in the future, private insurers will likely stop covering HAC-related costs, as well.
Given HACs are preventable, few would argue they shouldn’t happen: moreover, some even result in death. According to the U.S. Centers for Disease Control, there are an estimated 1.7 million healthcare-associated infections (HAIs) annually, causing 99,000 deaths. The overall annual direct medical cost of the HAIs to U.S. hospitals is as high as $45 billion, claims the CDC, with an estimated cost of HAI per patient as high as $25,903.
Now, further analysis based on 2009 data from HMC revealed how just a handful of off-quality cases are the biggest drivers of these enormous extra dollar costs. These findings, which demonstrate which HACs are the most costly, can provide guidance to patient care improvement and the preservation of hospital assets and resources.
HMC has listed the HAC categories below in order of prevalence, with their average total cost per hospital annually. Also listed is each HAC’s per-patient average cost increase. Because of the higher volume of some of the HACs, such as decubitis ulcers, they were more expensive overall for a hospital to treat, even if the per-patient cost was relatively low compared to other HACs.
HACs take financial toll
Decubitis ulcers were the most prevalent HAC, and because of that the second most expensive condition, costing a facility an average total of roughly $536,900 annually. A patient acquiring a bedsore requires an average of $9,200 in extra care.
Postoperative pulmonary embolism and deep-vein thrombosis (DVT) comprised the second most prevalent category, and the most expensive, costing a total of $564,000 each year. These two related HACs require $15,500 more in care expense per patient.
Accidental puncture and laceration comprised the third most prevalent category, and the fifth most costly, averaging a total of $248,100 per hospital. A patient affected by these typically requires $8,300 in healthcare dollars.
Post-operative respiratory failure was the fourth most prevalent and third most expensive HAC, at $261,000 in total per hospital. An afflicted patient requires $21,900 more in spend.
Infections due to medical care made up the fifth most prevalent HAC. It was the fourth most expensive category, costing $252,600 per hospital on average, and each afflicted patient, on average, requires $24,500 more in care.
Solutions to off quality exist
“The old saw that ‘An ounce of prevention is worth a pound of cure’ is truer in a hospital than most people realize,” said Shelley Burns, director of knowledge management at HMC. “With the proper focus on how physicians or diagnosis-related groups (DRGs) are actually the drivers of these off-quality results, big changes can happen.”
She went on: “While the statistics paint a gloomy picture, nevertheless, virtually all these HACs are preventable. However, hospitals must follow best practices, analyze the root causes of their off-quality issues, and engage clinicians in improving processes. HMC has assembled compelling best practices from all our clients. These are not theoretical, but ones that are actually on the ground and working. In some cases, they require education or performing special patient assessments, but generally it’s a small investment that can save hundreds of thousands of dollars annually.”
HMC News•
on February 26th, 2010•
First Year HMC Showcases Excellent Work of Clients
NEEDHAM, MASS. – February 8, 2010 – The Healthcare Management Council, Inc. (HMC) named its 2009 eight “Top Performer” hospitals. In selecting the winners, HMC scored each hospital according to seven dimensions, or criteria, including cost per adjusted admission, overall profitability, and patient satisfaction. HMC believes these criteria enable hospitals to accurately measure how effectively they are delivering healthcare value.
This is the first year HMC has assembled a Top Performer list. “We wanted to document the excellent work our client hospitals are doing using benchmark data,” explained John Whittlesey, principal at HMC. “There was stiff competition among the top contenders,” he observed.
The 2009 Top Performer was Dixie Regional Medical Center (DRMC), a 245-bed referral center based in St. George, Utah. The other three Top Performers were St. Joseph Mercy Saline Hospital, based in Saline, Mich.; Howell, Mich.-based St. Joseph Mercy Livingston Hospital; and American Fork Hospital, in American Fork, Utah.
For judging, HMC applied seven performance criteria. They are:
- Overall cost per adjusted admission in lowest one-half of peer group
- Overall quality score in best one-half of peer group based on the federal Agency for Healthcare Research and Quality (AHRQ) rankings
- High quality and low cost performance in the upper left quadrant versus peers
- Overall profitability > 5 percent
- Overall patient satisfaction score in best one-half of the peer group
- Overall cost per adjusted admission improved over previous benchmark
- Cited savings potential decreased from previous benchmark
We also gained some valuable insights,” Whittlesey said of the judging. “For instance, most of the Top Performers were part of health systems, and tended to be smaller-to-medium size hospitals, as opposed to big tertiary teaching facilities. Some people think big and complex is always better, and that’s not always the case.”
Other Top Performers
The “Honorable Mention” category included Sentara Leigh Hospital, in Norfolk, Va., and Utah Valley Regional Medical Center, based in Provo, Utah. In the “Most Improved” category were Sentara Williamsburg Regional Medical Center, based in Williamsburg, Va., and the Greeley, Colo.-based North Colorado Medical Center.
HMC News•
on February 4th, 2010•
Utah-based Dixie Regional Medical Center uses HMC tools to control costs and maintain patient care quality
NEEDHAM, MASS. – February 2, 2010 – The Healthcare Management Council, Inc. (HMC) named Dixie Regional Medical Center (DRMC) as its national “Top Performer” hospital.
This is the first year HMC is recognizing outstanding hospitals as Top Performers. In selecting the winners, analysts scored each hospital according to seven criteria, including cost-per-adjusted admission, overall profitability, and patient satisfaction. HMC believes these criteria enable hospitals to accurately measure how effectively they are delivering healthcare value.
HMC analysts found DRMC met six of the seven Top Performer criteria. A 245-bed referral center based in St. George, Utah, DRMC has been an HMC client for nearly 10 years. The DRMC is also part of Intermountain Healthcare, a Salt Lake City-based system with more than 32,000 employees and 23 hospitals.
“Finding the right balance between cost management, quality improvement, and growth is a tall order these days,” said John Whittlesey, HMC principal and one of the Top Performer judges. He explained DRMC had one of the strongest overall cost positions in its peer group, scored in the upper quartile for quality using the federal Agency for Healthcare Research and Quality (AHRQ) Patient Safety and Quality Indicators, and has consistently maintained a positive bottom line.
“Moreover, DRMC scored the highest in its peer group for overall patient satisfaction, and showed a remarkable 22 percent decrease in cited savings potential over the previous year’s benchmark report,” Whittlesey said.
According to Mary Hatch, chief financial officer for DRMC, the HMC tools enable staff to do drill-down analysis for cost control. “We have been able to make changes that didn’t affect the quality of patient care, but did make a cost savings,” said Hatch. This “tightening up” included the standardization of supplies and equipment to receive better pricing from suppliers, the conservation of power and water, and other similar initiatives, she explained.
Among HMC’s eight Top Performer hospitals, three, including DRMC, were part of Intermountain Healthcare. Another was American Fork Hospital, based in American Fork, Utah, which was a Top Performer. The third was the Utah Valley Medical Center, based in Provo, Utah, which won an HMC “Honorable Mention.
HMC News•
on January 3rd, 2010•
HMC has launched a new web site describing how hospitals use the HMC Span of Control Analysis™ and the HMC Smallest Practical Organization Modeler™ to improve their hospital organizations.
NEEDHAM, MASS. – January 3, 2010 – The Healthcare Management Council, Inc. (HMC) has launched a web site showcasing its enhanced span of control analysis. The HMC Span of Control Analysis gives you a clear picture of where your management structure can be streamlined, reducing your payroll costs and improving decision making without sacrificing care.
The new Web site is located at http://www.HospitalSpanOfControl.com and contains:
Contact us for a personal tour of the Analysis and Modeler.
