Delivering on the Vision: Keys to Achieving Breakthrough Operational Performance at Texas Children’s Hospital
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Delivering On The Vision:
Keys To Achieving Breakthrough Operational Performance
2013 Children’s Hospital Association
Annual Leadership Conference
October 14, 2013
Mark Mullarkey, Senior Vice President, Texas Children’s Hospital
Dan May, Managing Director, Huron Healthcare
2
Agenda
I. Summary
II. Texas Children’s Hospital’s Opportunities & Challenges
III. Governance Approach
IV. Transforming the Organization: Key Initiatives
V. Tracking Progress & Measuring Benefit
VI. Physician Engagement Strategies
VII. Lessons Learned
VIII. Questions
© 2013 Huron Consulting Group. All rights reserved. Proprietary & Confidential.
3
Summary
In late 2012 Texas Children’s Hospital (TCH) identified the need to improve financial performance of the health system by over $50M.
TCH launched a health system wide performance improvement initiative name “Delivering on the Vision.”
Partnering with Huron Healthcare, TCH identified over $60M of improvements in labor, non-labor, clinical operations, clinical documentation, and physician services.
Over the past year, the TCH team worked with Huron to successfully implement the identified improvement.
© 2013 Huron Consulting Group. All rights reserved. Proprietary & Confidential.
4
Agenda
I. Summary
II. Texas Children’s Hospital’s Opportunities & Challenges
III. Governance Approach
IV. Transforming the Organization: Key Initiatives
V. Tracking Progress & Measuring Benefit
VI. Physician Engagement Strategies
VII. Lessons Learned
VIII. Questions
© 2013 Huron Consulting Group. All rights reserved. Proprietary & Confidential.
5
Background
Texas Children’s Hospital (TCH) identified the need to improve financial performance of the health system by reducing costs, increasing revenue, and improving quality.
• $50 million gap between projected 2013 profitability and target operating margin
• Federal and state funding reductions driving most of this gap • Higher margins crucial for replenishing capital and expanding TCH
facilities• Competitive threats driving expected gap closer to $75M
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6
Project Background & Scope
The TCH leadership team initiated a health system wide performance improvement project named “Delivering on the Vision” in reference to the their “Vision 2010 Initiative”
Project assessed and addressed performance in every key operational area:
– Labor Expenses – Non-Labor Expenses – Clinical Operations – Clinical Documentation Improvement – Physician Services
© 2013 Huron Consulting Group. All rights reserved. Proprietary & Confidential.
Business Imperative of $50M identified
7
2011 June 2012 YTDRun Rate
2013 2014 2015 2016 2017 $(60,000)
$(40,000)
$(20,000)
$-
$20,000
$40,000
$60,000
$80,000
$100,000
$120,000
Today's Operating Margin Gap$'s in 000
Target Operating Margin Projected Operating Margin
2013 Estimate$50 MM
Estimate higher margins will be re-quired to maintain an Aa2 rating, replenish capital and expand facili-ties
June 12 YTD $75MM
8
Agenda
I. Summary
II. Texas Children’s Hospital’s Opportunities & Challenges
III. Governance Approach
IV. Transforming the Organization: Key Initiatives
V. Tracking Progress & Measuring Benefit
VI. Physician Engagement Strategies
VII. Lessons Learned
VIII. Questions
© 2013 Huron Consulting Group. All rights reserved. Proprietary & Confidential.
Executive Steering Committee PROJECT GOVERNANCE – IMPLEMENTATION
9
Huron Client Services Executive
Daniel May
TCH Executive Sponsors
Susan MacDonald, EVP, RNRandy Wright, EVP & COO Project Management
TCH: Mark MullarkeyHuron: Robert Donnert
Labor
Huron: Greg BryanTCH: Lori Armstrong
Non-Labor
Huron: Dan MayTCH: John Nickens
Physician Svc
Huron: Chris SmedleyTCH: Mallory Caldwell
Clinical Ops
Huron: Larry BurnettTCH: Tabitha Rice
CDI
Huron: Gerri BergTCH: Dan DiPrisco
Executive Steering Committee
Randy Wright, EVP & COO Susan MacDonald, EVP Ben Melson, EVP & CFO Dr. Mark Kline, MD, Physician in-Chief Dr. Michael Belfort, MD, Ob/Gyn in-Chief Dr. Charles Fraser, MD Surgeon in-Chief Dr. James Versalovic, MD Pathology Dr. George S Bisset, MD Radiology Dr. Dean Andropoulos, MD AnesthesiaDr. Gordon Schutze, MD Peds Dr. Manju Monga, MD OB/Gyn Dr. David Wesson, MD SurgeryLori Armstrong, SVP & CNO Linda Aldred, SVP HR Mallory Caldwell, SVP StrategyMary Jo Andre, VP Quality John Nickens, VP Supply & Hosp Based Tabitha Rice, VPMichelle Riley-Brown, SVP West Cris Daskevich, SVP Women’s Pavilion Alec King, VP FinanceSherry Fultz, AVP Mark Mullarkey, SVP Ambulatory & OR Matt Girotto, AVP Surgical ServicesChanda Cashen, AVP OB/Gyn Diane Scardino, AVP Medical Practice
© 2012 Huron Consulting Group. All rights reserved. Proprietary & Confidential.© 2013 Huron Consulting Group. All rights reserved. Proprietary & Confidential.
Executive Steering Committee PROJECT GOVERNANCE – WORK TEAMS
10
LaborSolution Team
Huron: Greg BryanHuron: Irene WalshTCH: Lori ArmstrongTCH: M. Riley-Brown
Coord: L. Toures
Non-LaborSolution Team
Huron: Dan MayHuron: P. ZimmermanTCH: John NickensTCH: D. ScardinoTCH: Dr. D. Roth Coord: J. Estes
Physician SvcSolution Team
Huron: C. SmedleyTCH: Mallory Caldwell
TCH: T. JohnsonMD Leaders:
Dr. Shutze, Dr. Wesson, Dr. MongaCoord: M. Wilrich
Clinical OpsSolution Team
Huron: Larry BurnettHuron: Brad StaterTCH: Tabitha Rice
TCH: G. ParazynskiCoord: G. Erwin
CDISolution Team
Huron: Gerri BergHuron: S ManierreTCH: Dan DiPrisco
Coord: J. Austin
Nursing Work Team
Pharmacy Work Team
Lab Work Team
Surgical Work Team
PediatricsWork Team
OB/GynWork Team
SurgeryWork Team
Case Management Work Team
Patient Placement
Work Team
Care Coordination Work Team
Care Variation
Work Team
Physician Education Work Team
Coding – Reconciliation
Work Team
Cath Lab Work Team
Surgical Work Team
Non-Clinical Work Team
Food/EVSWork Team
Nursing Work Team
Perioperative Work Team
Corporate Work Team
Clinical Ancillary
Work Team
Support Services
Work Team
© 2012 Huron Consulting Group. All rights reserved. Proprietary & Confidential.© 2013 Huron Consulting Group. All rights reserved. Proprietary & Confidential.
11
Agenda
I. Summary
II. Texas Children’s Hospital’s Opportunities & Challenges
III. Governance Approach
IV. Transforming the Organization: Key Initiatives
V. Tracking Progress & Measuring Benefit
VI. Physician Engagement Strategies
VII. Lessons Learned
VIII. Questions
© 2013 Huron Consulting Group. All rights reserved. Proprietary & Confidential.
Assessment: Key Findings
TCH’s growth in spending had been greater than its growth of revenue over the past year, creating an imperative to reduce spending; early intervention is TCH’s motto.
The following elements have prompted TCH to reduce spending:
Staffing levels had risen faster than what has been budgeted
Annual non-labor /supply chain spending had risen faster than what has been budgeted
Funding of the Baylor College of Medicine had increased faster than what has been budgeted
TCH lacked standardization in key areas of operations, vendor contracting, and clinical processes of care.
TCH lacked a long term plan that integrated physician capacity and recruitment, support staff needs, facility space needs, and required capital expenditures.
12
Assessment: Key Findings
TCH lacked an integrated care management program, consistent coordinated interdisciplinary meetings, and regular adherence to evidence based standards of care for length of stay management.
TCH lacked a productivity management tool to help department leaders and providers to manage their labor costs and flex their staffing to changes in volume.
TCH lacked an effective position control process to manage the hiring decisions across the organization and an effective process for monitoring and managing premium labor.
TCH’s management to staff ratio was inconsistent across different areas.
TCH lacked a clinical documentation management process for optimizing coding and reimbursement of future Medicaid APR-DRG patients.
13
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TOTAL ANNUALIZED ASSESSMENT OPPORTUNITY
Area Low Mid-Point High
Non-Labor $7,330,000 $8,847,500 $10,365,000
Labor $8,412,000 $12,297,000 $16,182000
Clinical Documentation $6,772,500 $9,030,000 $11,287,500
Clinical Operations $5,900,000 $9,350,000 $12,800,000
Physician Services $15,433,000 $20,651,150 $25,869,300
Annualized Total $43,847,500 $60,175,650 $76,038,800
Total Opportunity Identified from Assessment
© 2013 Huron Consulting Group. All rights reserved. Proprietary & Confidential.
15
Agenda
I. Summary
II. Texas Children’s Hospital’s Opportunities & Challenges
III. Governance Approach
IV. Transforming the Organization: Key InitiativesI. Non-LaborII. LaborIII. Clinical DocumentationIV. Clinical OperationsV. Physician Services
V. Tracking Progress & Measuring Benefit
VI. Physician Engagement Strategies
VII. Lessons Learned© 2013 Huron Consulting Group. All rights reserved. Proprietary & Confidential.
Executive Summary: Non-Labor
Strengths GPO Compliance Clinical practice and product choices are strongly influenced by evidence based literature and
research Texas Children’s Hospital performs innovative, cutting-edge procedures. These procedures often
require extensive supply resources
Opportunities Majority of savings are related to standardization and utilization of supplies and services Some of the cost savings opportunities may require administrative support and leadership
16© 2013 Huron Consulting Group. All rights reserved. Proprietary & Confidential.
17
NON-LABOR - TOTAL ANNUALIZED ASSESSMENT OPPORTUNITY
Area Low Midpoint High
Medical/Surgical $660,000 $705,000 $950,000
Surgical Services $700,000 $850,000 $1,000,000
Cath Lab & Imaging $270,000 $330,000 $390,000
Laboratory $800,000 $1,000,000 $1,200,000
Pharmacy $2,000,000 $2,250,000 $2,500,000
Purchased Services $1,700,000 $2,100,000 $2,500,000
IT $550,000 $687,500 $825,000
Food Services/EVS $650,000 $825,000 $1,000,000
Annualized Total $7,330,000 $8,847,500 $10,365,000
Non-Labor Opportunity Identified
© 2013 Huron Consulting Group. All rights reserved. Proprietary & Confidential.
18
Agenda
I. Summary
II. Texas Children’s Hospital’s Opportunities & Challenges
III. Governance Approach
IV. Transforming the Organization: Key InitiativesI. Non-LaborII. LaborIII. Clinical DocumentationIV. Clinical OperationsV. Physician Services
V. Tracking Progress & Measuring Benefit
VI. Physician Engagement Strategies
VII. Lessons Learned© 2013 Huron Consulting Group. All rights reserved. Proprietary & Confidential.
LABOR - TOTAL ANNUALIZED ASSESSMENT OPPORTUNITY
AREA LOW MIDPOINT HIGH
Nursing $2,326,000 $3,757,500 $5,189,000Clinical Ancillary $2,720,000 $4,025,500 $5,331,000Non-Clinical Support $1,825,000 $2,727,000 $3,629,000Administrative/Financial $1,541,000 $1,787,000 $2,033,000Annualized Total $8,412,000 $12,297,000 $16,182,000
Labor Opportunity Identified
19
Strengths Management is open and supportive of change and improvement Quality of talent is strong Passionate about Texas Children’s HospitalOpportunities Implement discipline and tools for successful productivity management Design an organizational structure, span of control and accountability process to support strategic plans Review/revise/support system-wide position requisition and control process
© 2013 Huron Consulting Group. All rights reserved. Proprietary & Confidential.
Dollars Total Main Campus Pavilion West Campus
Key Operational Areas Low High Low High Low High Low High
Nursing $2,326,000 $5,189,000 $1,467,000 $4,330,000 $480,000 $480,000 $379,000 $379,000
Clinical Ancillary $2,720,000 $5,331,000 $2,276,000 $4,689,000 $26,000 $34,000 $418,000 $608,000
Support Services $1,825,000 $3,629,000 $1,200,000 $2,717,000 $348,000 $596,000 $277,000 $316,000
Financial/Administrative $1,541,000 $2,033,000 $1,541,000 $2,033,000 $0 $0 $0 $0
TOTAL $8,412,000 $16,182,000 $6,484,000 $13,769,000 $854,000 $1,110,000 $1,074,000 $1,303,000
FTEs Total Main Campus Pavilion West Campus
Key Operational Areas Low High Low High Low High Low High
Nursing 24.0 53.5 16.0 45.5 4.0 4.0 4.0 4.0
Clinical Ancillary 33.8 66.1 28.2 57.7 0.6 0.8 5.1 7.6
Support Services 29.4 50.5 17.7 34.1 7.1 11.2 4.6 5.2
Financial/Administrative 21.5 28.8 21.5 28.8 0.0 0.0 0.0 0.0
TOTAL 108.7 199.0 83.4 166.1 11.7 16.0 13.7 16.9
20
Labor Opportunity by Facility
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Flexing Staffing to DemandKEY IMPLEMENTATION APPROACH
© 2013 Huron Consulting Group. All rights reserved. Proprietary & Confidential. 21
Note: R2 of 1.0 indicates the regression line perfectly fits the data
Flexing Staffing to Volume
Volume to staffing regression correlations indicate 77% of patient care units are not flexing efficiently to census
22
Agenda
I. Summary
II. Texas Children’s Hospital’s Opportunities & Challenges
III. Governance Approach
IV. Transforming the Organization: Key InitiativesI. Non-LaborII. LaborIII. Clinical DocumentationIV. Clinical OperationsV. Physician Services
V. Tracking Progress & Measuring Benefit
VI. Physician Engagement Strategies
VII. Lessons Learned© 2013 Huron Consulting Group. All rights reserved. Proprietary & Confidential.
23
CLINICAL DOCUMENTATION IMPROVEMENT - TOTAL ANNUALIZED ASSESSMENT OPPORTUNITY
Area Low Midpoint High
Improved Reimbursement After CDI $6,772,500 $9,030,000 $11,287,500
Annualized Total $6,772,500 $9,030,000 $11,287,500
Clinical Documentation Improvement Opportunity
Strengths The coding staff has an awareness that chart documentation needs improvement The coding staff desires to embrace change
Opportunities Coding opportunities were found that would significantly affect reimbursement with APR-
DRGs Coding opportunities were found that would affect severity of illness and risk of mortality
which would increase the case mix index (CMI)
© 2012 Huron Consulting Group. All rights reserved. Proprietary & Confidential.© 2013 Huron Consulting Group. All rights reserved. Proprietary & Confidential.
Case Review CLINICAL DOCUMENTATION IMPROVEMENT
24
Total Charges of the 75 Charts
TCH’sReimbursement
at Current Rate of 36% of Charges
TCH’s Reimbursement at
APR-DRGRate
Improved Reimbursement (APR-
DRG) After Implementation
Incremental Change With Improved Documentation
$ 7,316,055 $2,633,781 $2,403,722 $3,191,981 $788,259
The following summary provides the results of an analysis conducted on 75 cases reviewed during the assessment:
© 2013 Huron Consulting Group. All rights reserved. Proprietary & Confidential.
25
Agenda
I. Summary
II. Texas Children’s Hospital’s Opportunities & Challenges
III. Governance Approach
IV. Transforming the Organization: Key InitiativesI. Non-LaborII. LaborIII. Clinical DocumentationIV. Clinical OperationsV. Physician Services
V. Tracking Progress & Measuring Benefit
VI. Physician Engagement Strategies
VII. Lessons Learned© 2013 Huron Consulting Group. All rights reserved. Proprietary & Confidential.
26
CLINICAL OPERATIONS - TOTAL ANNUALIZED ASSESSMENT OPPORTUNITY
Area Low Midpoint High
Annual Length of Stay Benefit $5,900,000 $9,350,000 $12,800,000
Clinical Operations Assessment Opportunity
Strengths Organization has been primed for change by the current leadership Leaders at all levels expressed interest in obtaining data to support decision making and increase
accountability Case Management leadership has outlined an appropriate vision for the future of their department
Opportunities Patients are staying longer than medically necessary and are not transitioning to a lower level of care
in a timely manner Without operational process improvement and a bed allocation analysis, TCH will not have the ability
to serve additional inpatients without operating above 85% utilization, which hinders patient throughput
No centralized tool is being used to track key throughput metrics. These metrics should be used daily/weekly to support comprehensive patient flow improvement.
© 2013 Huron Consulting Group. All rights reserved. Proprietary & Confidential.
Length of Stay Opportunity
Append
ectom
y
Post-O
p, Post
-Traumatic
, Othe
r Dev
ice Inf
ectio
ns
Cardiac
Valve P
rocedu
res with
out Card
iac Cath
Malnutri
tion, F
ailure
to Thriv
e & oth
er Nutir
itiona
l Diso
rders
Seizure
Cardiac
Defibrilla
tor & Hear
t Ass
ist Im
plant
Craniot
omy,
except
for Trau
ma
Cardiac
Cath with
Circula
tory Diso
rder
excep
t for Is
chemic H
eart D
isease
Proced
ure with
Diagnos
is, Reh
ab, After
care o
r Othe
r Cont
act with
Heath S
ervice
Other H
epatob
iliary,
Pancrea
s & Abdo
minal P
rocedu
res05
101520253035404550
Opportunity Days: 920
Volume: 891
Opportunity Days: 728Volume: 200
Opportunity Days: 660Volume: 90
Opportunity Days: 585Volume: 216
Opportunity Days: 512 Volume: 698
Opportunity Days: 446Volume: 14
Opportunity Days: 415Volume: 186
Opportunity Days: 340Volume: 27
Opportunity Days: 303 Volume: 27
Opportunity Days: 280Volume: 10
Average Length of Stay for Top 10 APR-DRGs
BenchmarkTCH
Aver
age
Leng
th o
f Sta
y (D
ays)
Notes:
Listed in order of descending opportunity days
TCH Date Timeframe: June 1, 2011 to May 31, 2012
Population: All Main Campus patients, all APR – DRGs except those related to newborn, rehabilitation and psychiatry
Benchmark: 2010 PHIS data (Atlanta, Boston, CHOP, Cincinnati, Dallas, LA, Seattle)
MAIN CAMPUS
27© 2012 Huron Consulting Group. All rights reserved. Proprietary & Confidential.© 2013 Huron Consulting Group. All rights reserved. Proprietary & Confidential.
> 0 to < 2 Days 2 to < 4 Days 4 to < 6 Days 6 to < 11 Days 11 to < 20 Days 20+ Days0%
10%
20%
30%
40%
50%
60%
49%
20%
10% 10%6% 5%
Excess Days Variance over Benchmark Length of Stay
Notes:
Timeframe: June 1. 2011 to May 31, 2012
Population: All Main Campus patients, all APR – DRGs except those related to newborn, rehabilitation and psychiatry
DRGs: APR – DRGs
Source: 2010 PHIS data (Atlanta, Boston, CHOP, Cincinnati, Dallas, LA, Seattle)
Length of Stay OpportunityMAIN CAMPUS
35% of TCH patients have excess days. The delineation of those patients by number of excess days is outlined below.
40% of cases have a variance of 2 to 11 days
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Length of Stay Benefit Opportunity
Demand Backfill
Percentage
Cost Savings
Percentage
Backfill(Number of
Cases)
Patient Days Reduction
(Associated with Cost Savings)
OpportunityLow
OpportunityHigh
50% 50% 700 3,600 $5.9 M $12.8 M
60% 40% 800 3,000 $8.3 M $17.7 M
70% 30% 1,000 2,200 $10.6 M $22.6 M
80% 20% 1,100 1,400 $13.0 M $27.6 M
90% 10% 1,200 700 $15.4 M $32.5 M
100% 0% 1,400 0 $17.7 M $37.4 M
Notes:
Benefit model incorporates lost revenue associated with reducing length of stay of patients with payers who reimburse based on percent of charges (except Medicaid given the upcoming reimbursement change), which includes 70% of the total patient days
Alec King, Vice President of Finance, reviewed and approved the benefit model methodology
50% backfill estimate is based on conversations with several TCH senior executives
Includes Medical/Surgical patients (excludes NICU, newborns, chemical dependency, psychiatry, rehabilitation and ungroupable) who discharged 6/1/ 2011 – 5/31/2012
Clinical Operations Financial Benefit Low High
Length of Stay Benefit• Reduction in 4,800 to 9,700 patient days results in the following benefit:
• Capacity created to serve an additional 450 to 930 patients annually (50% backfill)• Cost savings associated with reducing 2,400 to 9,700 patient days (50% cost savings)
$5.9 M $12.8M
MAIN CAMPUS
29© 2013 Huron Consulting Group. All rights reserved. Proprietary & Confidential.© 2013 Huron Consulting Group. All rights reserved. Proprietary & Confidential.
30
Agenda
I. Summary
II. Texas Children’s Hospital’s Opportunities & Challenges
III. Governance Approach
IV. Transforming the Organization: Key InitiativesI. Non-LaborII. LaborIII. Clinical DocumentationIV. Clinical OperationsV. Physician Services
V. Tracking Progress & Measuring Benefit
VI. Physician Engagement Strategies
VII. Lessons Learned© 2013 Huron Consulting Group. All rights reserved. Proprietary & Confidential.
PHYSICIAN SERVICES - TOTAL ANNUALIZED ASSESSMENT OPPORTUNITY
Area Low Midpoint High
Clinical Efficiency $15,000,000 $20,000,000 $25,000,000
Non-Provider Labor (1) $ 433,000 $ 651,150 $ 869,300
Annualized Total $15,433,000 $20,651,150 $25,869,300
Physician Services Opportunity
31
Opportunities Continue support of the TCH/Baylor mission through process improvements including, but not limited to:
Increase provider throughput and revenue Improve patient flow and access in clinics by improving scheduling templates, utilization of support staff
and standardizing staffing models where appropriate Refine CART model to tie revenue to expenses Align labor costs, revenue and production to directly correlate with appropriate cost centers
(1) Non Provider Labor does not include Baylor staff as they were not accounted for in the Labor Analysis
© 2013 Huron Consulting Group. All rights reserved. Proprietary & Confidential.
Clinical Efficiency
DepartmentNumber of
Physicians in analysis
Total FTEs Clinical FTEs
New full time FTES (hired
After 7/1/2011)Total wRVUs Annualized
wRVU Gap to Sullivan
Cotter FTE adjusted Median
Potential Net Collections to Sullivan Cotter
Median
wRVU Gap to FPSC FTE Adjusted Median
Potential Net Collections to FPSCr Median
Pediatrics 617 489.89 290.14 63.00 1,066,278 329,140 $18,309,820 666,620 $36,840,622
Surgery 58 56.27 43.13 8.00 300,896 29,243 $2,005,042 80,772 $5,979,215
Obstetrics/ Gynecology – Baylor 36 33.90 25.55 22.00 77,223 77,596 $4,943,768 103,576 $6,748,980
Obstetrics/ Gynecology - TCH 13 13.00 13.00 **0 112,137 5,187 $523,101 9,476 $923,837
Anesthesiology 51 49.71 40.48 3.00 408,697 74,476 $2,276,571 * *
Pathology 21 21.00 9.20 6.00 42,108 8,859 $535,666 11,628 $706,526
Pediatric Radiology 26 23.90 20.00 0.60 109,555 15,963 $1,374,537 56,545 4,585,666
Total 822 687.67 441.50 102.60 2,116,894 540,464 $29,968,505 928,617 $55,784,846
32
* Providers were all acquired after 7/1/2011 but because the practice was already established all providers were included in analysis
** No benchmark for anesthesiology available in FPSC survey
© 2013 Huron Consulting Group. All rights reserved. Proprietary & Confidential.
33
Agenda
I. Summary
II. Texas Children’s Hospital’s Opportunities & Challenges
III. Governance Approach
IV. Transforming the Organization: Key Initiatives
V. Tracking Progress & Measuring Benefit
VI. Physician Engagement Strategies
VII. Lessons Learned
VIII. Questions
© 2013 Huron Consulting Group. All rights reserved. Proprietary & Confidential.
ACTIVITIES
DELIVERA
BLES
Organize project teams
Establish baseline measurement criteria
Identify and quantify financial benefit initiatives
Complete detailed operational analysis
Build business case for specific initiatives
Obtain approval to implement initiatives
Implement detailed improvement ideas and plans
Compile improvement documentation
Train and educate staff
Implement improvement plans and initiatives
Implement management tools and reporting
Empower management and drive accountability
Align organization structure to support changes
Begin measuring results
Implement residual program
Ensure management has accepted
accountability
Monitor financial results
Transition project management office
Work steps completed for high priority initiatives Work steps completed for additional initiatives
Benefits tracking and monitoring tool
Residual work steps completed for all initiatives
Benefits tracking and monitoring tool
Monitoring of savings
Develop Initiatives
Months 1 - 3
Implement Initiatives
Months 3 - 12
Monitor Benefits
Months 9 – 12+
Timeline
34
Knowledge Transfer, Empower Management and Drive Accountability
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35
Delivering on the Vision Project Scorecard
Area Savings Timeline Issues
Non Labor
Labor
Clinical Documentation
Clinical Operations
Physician Services
Project Scorecard - Example
Proceeding as planned At risk for trending off plan Require immediate attention
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Non-Labor Project Scorecard (partial example)
36
Key Updates
Status Summary Issues/Barriers
Action/ Next Steps
Non-Labor Monitored initiatives at a confirmed value of $13M All teams working to complete implementation and
monitoring of remaining initiatives
None None
Purchased Services
Identified to 179% of high goal Implemented to 166% of mid-point goal $1M in additional identified initiatives being completed
None Monitor remaining initiatives
Information Technology
Identified to 505% of high-goal Implemented to 605% of mid-point goal All initiatives have been implemented
None None
Laboratory
Identified to 64% of high goal Implemented to 6% of mid-point goal $700K in additional identified initiatives remaining to be
implemented
Delays to a number of initiatives being resolved
Implement and monitor remaining initiatives
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Proceeding as planned At risk for trending off plan Require immediate attention
37
Summary of Key Project Results
Improved margin by $32M in FY 13 YTD Improved flexing of staff, reduced FTEs, and developed and implemented
a new labor productivity system; also developed worked hours per unit of service (WHPUOS) standards for key departments
Reduced non-labor supply and purchased services costs and improved 340B benefits
Reduced length of stay, implemented interdisciplinary care rounds, implemented Teletracking and other tools
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38
Summary of Key Project Results
Improved clinical documentation producing an increase in severity adjusted case mix index
Improved physician productivity Increased transparency with physicians and staff Improved quality by standardizing staffing levels and reducing care
variation
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Benefit Scorecard – Overall Project (as of 09/ 2013)
39
• Clinical Documentation tracking begins in 10/2013 following Medicaid APR-DRGs start in TX on 9/1/13
Solution Group Target Benefits
Identified Benefits
Implemented Benefits
Realized Benefits
FY 13 YTD
Non-Labor $8,847,500 $17,786,447 $14,011,071 $7,558,869
Labor $12,297,000 $13,725,177 $9,382,125 $5,276,000 Clinical Doc. $9,030,000 $9,030,000 $ TBD $ TBDPhysician Services $20,651,150 $14,263,000 $9,540,200 $8,089,000 Clinical Operations $9,350,000 $9,350,000 $11,874,500 $11,874,500
LOS Reduction (Days) 7250 7250 10,560 10,560
Total $60,175,650 $64,154,624 $44,807,896 $32,789,369
% of Target 107% 72% 52%
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Labor – FTE’s
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Labor – Salary & Benefit as % of NPSR
41
• Net Patient Service Revenue is up 11.9%
• Salary and Benefit Expense is up just
5.9%
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Labor – Control of Temp Expense
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Estimated Financial ImpactACTUAL PAYROLL DATA VS FY13 BUDGET
43
Notes: In scope labor depts only; Dollars estimated based on avg wage rate per dept and include a 15% benefit factor
Average Paid FTE Variance from FY13 Budget= 386.7 paid FTE
Cumulative Paid Dollar Variance by Pay Period (FY13 to PPE 4/13/13) = $16,013,200
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Project Results:Clinical Operations Realization Schedule
44Confidential.
Projected Annual Benefit includes:
+ Demand Backfill
+ Cost Savings
– Revenue Loss
45
Physician Services
Updated as of 7.17.13
Specialty
Not Started
In Process Past Due Complete Total
Not Started
In Process
Past Due Complete
OBG BCM 1 4 0 6 11 9% 36% 0% 55%POGC/WSH 5 5 0 5 15 33% 33% 0% 33%OBG MFM 0 5 0 8 13 0% 38% 0% 62%
A&I 0 1 0 7 8 0% 13% 0% 88%ADO 2 1 2 10 15 13% 7% 13% 67%AGP 0 0 0 0 0CAR 0 4 0 9 13 0% 31% 0% 69%DER 5 0 0 7 12 42% 0% 0% 58%DEV 0 0 0 0 0END 10 10 0 1 21 48% 48% 0% 5%
HEM/ONC 0 6 0 6 12 0% 50% 0% 50%INF 0 0 0 0 0NEP 0 0 2 14 16 0% 0% 13% 88%NEU 0 1 1 12 14 0% 7% 7% 86%NGI 0 0 2 12 14 0% 0% 14% 86%PMR 0 0 0 0 0PSY 0 0 0 0 0PUL 0 5 0 6 11 0% 45% 0% 55%RHE 0 4 0 3 7 0% 57% 0% 43%CHS 0 5 0 0 5 0% 100% 0% 0%NSU 0 0 0 6 6 0% 0% 0% 100%OPH 10 0 0 0 10 100% 0% 0% 0%ORT 0 3 3 10 16 0% 19% 19% 63%OTO 1 4 0 9 14 7% 29% 0% 64%PLA 3 0 1 4 8 38% 0% 13% 50%PSU 0 3 0 11 14 0% 21% 0% 79%
SYSTEM WIDE 1 12 2 16 31 3% 39% 6% 52%TOTALS 38 73 13 162 286 13% 26% 5% 57%
Overall%AGES COMPLETE
OverallCOUNTS
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Access - 3rd Available
Specialties Tracked and Included:Renal Neurology Genetics Development Pedi Physical Medicine Clinic Psychology Service Plastic Surgery Dental Rheumatology Orthopaedics Pediatric Surgery Congenital Heart Surgery Allergy & Immunology Urology Retrovirology Dermatology Endocrine Ophthalmology Orthodontics Cardiology GI & Nutrition Pulmonary Medicine Res. Primary Care Hematology/Oncology Otolaryngology Psychiatry - 17O NeurosurgeryAdol/Sports/Med/Yng Womens Gynecology Inf. Disease
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Internal Texas Children’s Pediatrics Referral Rate
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TCH: Mid-Project Experience Survey Results
The focus of the Care Process (CP) initiative is on creating a foundation and
work processes to support physician adoption of evidence-based standards of
care.
• Pneumonia Care Process team is developing a care pathway which supports
earlier discharge preparation, cohorted beds, and respiratory support
• DKA Care Process team is developing a business case for a Diabetes Center for
Excellence which includes pathway and education and translator availability;
initiating hospital benchmarking for insulin pen vs. insulin vial only on formulary
Year End Goal
Net Days Saved
7,250 5,531
Patient Day
Accumulation
for Project Period
(Nov-May FY13)
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
10,000
76%
of goal
7,250
5,531
Severity-adjusted average length of stay
decreased by 15.9 hours per patient, an 11%
reduction compared to historic period!
• Patient flow efforts increased capacity to serve
5,531 more patient days, cumulatively
• 51% decrease in Red Acute Care Census Alert
hours
(34 in Mar-May ‘13 vs. 69 in Mar-May ‘12)
• 9% decrease in EC boarding time average
(Mar-May ‘13 vs. Mar-May ‘12)
• 14% decrease in readmissions within 48 hours
(38 in Mar-May ‘13 vs. 44 in Mar-May ‘12)
Results at a Glance …
Most Recent Three-Month Period (Mar-May ’13)
vs. Historic Period (June ’11-May ‘12) Care Management
• Engaged over 20 care managers in weekly Clinical High Risk meetings to collaboratively address
and resolve barriers to efficient patient flow, efficient care, transitions to the next level of care and
hospital reimbursement
• Implemented Morrisey, a Care Management software tool for discharge planning, utilization review,
and other work flow management
Care Progression
• Established 11 daily and multidisciplinary Care Progression Rounds (CPR) across over 35 services
to proactively plan for patient's discharge with the care team and the patient/family
• Conducted over 1,200 CPRs (and counting) since project start, with participation by over 500
physicians, nurses, and supporting care team members
Room Management
• Centralized Main campus bed assignment process which included the implementation of
TeleTracking (TT), an electronic bed board; Trained over 600 nurses, unit clerks, EVS, and Patient
Escort staff members on TT tool
• Redesigned the EVS & Patient Escort staffing model to support a dedicated discharge cleaning
team and discharge transportation process; automated discharge cleans and transportation
requests with use of the TT tool
“It's incredible when I think about the results
we've had recently…it is making a big
difference.”
-Executive Leadership
Delivering on the Vision:
Care Process Updates
Key Accomplishments to Date
TeleTrackingXT TM
: An Update on the Centralized Bed Assignment
Process
• Room Management has placed approximately 1,500 patients in beds since go-live
(5/29)
• EVS has conducted over 1,200 discharge cleans since go live
• Patient Escort has performed over 300 discharge trips since go live“I’m on service this week and I have to tell you
about how much the energy has changed on the
floors! Everyone’s talking about and planning for
discharges.”
-Hospitalist
“[Requesting a bed] through TeleTracking makes my job so much
easier. I can trust that things will happen without me interfering and
getting on the phone.”
-Charge Nurse
Clinical Operations Update - June 2013
Clinical Documentation Initiative – Main CampusBASELINE VERSUS IMPACT OF CDI PROGRAM IMPLEMENTATION
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Clinical Documentation Initiative - West CampusBASELINE VERSUS IMPACT OF CDI PROGRAM IMPLEMENTATION
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Business Imperative of $50M identified
51
2011 June 2012 YTDRun Rate
2013 2014 2015 2016 2017 $(60,000)
$(40,000)
$(20,000)
$-
$20,000
$40,000
$60,000
$80,000
$100,000
$120,000
Today's Operating Margin Gap$'s in 000
Target Operating Margin Projected Operating Margin
2013 Estimate$50 MM
Estimate higher margins will be required to maintain an Aa2 rating, replenish capital and expand facilities
June 12 YTD $75MM
For the 11 months ended August, the Hospital had an operating margin of $55.8M on a budget of $37.9M. Hospital operating margins
have improved from the prior year by $72.7M.
52
Agenda
I. Summary
II. Texas Children’s Hospital’s Opportunities & Challenges
III. Governance Approach
IV. Transforming the Organization: Key Initiatives
V. Tracking Progress & Measuring Benefit
VI. Physician Engagement Strategies
VII. Lessons Learned
VIII. Questions
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53
Physician Engagement Strategies
Physician leaders should be involved from the beginning Transparency is important when working with the physicians Accurate data presentation and interpretation is key to get the physicians
engage Inclusion of medical staff at all levels and particularly in all work teams Communicate, communicate, communicate
© 2013 Huron Consulting Group. All rights reserved. Proprietary & Confidential.
54
Agenda
I. Summary
II. Texas Children’s Hospital’s Opportunities & Challenges
III. Governance Approach
IV. Transforming the Organization: Key Initiatives
V. Tracking Progress & Measuring Benefit
VI. Physician Engagement Strategies
VII. Lessons Learned
VIII. Questions
© 2013 Huron Consulting Group. All rights reserved. Proprietary & Confidential.
“Leadership always impacts and influences outcomes, not some of the time, but all of the time.”
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Labor
Clinical DocumentationClinical Operations
Physician Services
Non-Labor
Lori Armstrong, MSN, RN
CNO, SVP
Michelle Riley-Brown
SVP
TCH West Campus
John Nickens
VP
Hospital Based Services and
Supply Chain
Diane Scardino
AVP
Ambulatory Servcies
Tabitha Rice
SVP
Clinical Support Services
Jackie Ward, RN
Director
Cancer Center
Joan Shook, MD
Chief Safety Officer
Dan Diprisco
Director
Physician Revenue Cycle
Trent Johnson
Director
Ambulatory Services
Mallory Caldwell
SVP Strategy
But it takes a team…..a very large team!
56
Dr. Jordan Orange
Kim Nguyen
Mari Trace
Dr. Peter Hiatt
Dr. Charles Gay
Dr. Gary Clark
Dr. Robert Zeller
Tuhin Pakaj
Dr. Thomas Luerssen
Lorraine Cogan
Ryan Breaux
Dr. David Coats
Dr. William Phillips
Binta Baudy
Dr. David Roth
Dr. Ellen Friedman
Dr. Al Hergendroeder
Mary Kana
Dr. Jed Nuchtern
Cindy Miley
Dr. Michael Braun
Sandra Tillis
Helen Currier
Tina Ninan
Dr. Jennifer Deitrich
Dr. Gordon Schutze
Dr. Ryan HimesKara Lenahan
Stephanie Ramirez
Dr. Jake Kushner Dr. Angelo Giardino
Matt GirottoLaura Hardy
Diane Scardino
Trent Johnson
Chanda Cashen
Dr. Monju Monga
John Henderson
Mike Towne
Sherry FultzDr. Carol Altman
Sarah McMaster
Matt Timmons
Dr. Daniel Penny Jackie Ward
Dr. Brigetta Meuller
Physicia
n Service
sRobert Turner
Jennifer Upshaw
Dan Diprisco
Travis Crum
Daniel Fischer
Jeff Reinhart
Dr. Efrain Bleiberg
Dr. Doug Ris
Jennifer Evans
Barkha Chandwani
Dr. Theresa Wright
Dr. Thomas Shaw
Dr. Scott Dorfman
57
Lessons Learned
Successfully implementing enterprise-wide performance projects requires:• Executive engagement and support • Physician engagement and support• Transparency and accountability • Setting realistic improvement goals for each solution• Communicating savings targets per initiative to all affected parties• Communication and early buy-in from all stakeholders to ensure timely
implementation• Effective benefit realization monitoring and presentation – measure,
measure, measure. Data and trends as “pictures”
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58
Lessons Learned
Once redesign efforts are completed the organization must invest in resources to continue monitoring to hold the gains- Ongoing (although maybe modified) governance structures- Hardwired reporting mechanisms
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59
Agenda
I. Summary
II. Texas Children’s Hospital’s Opportunities & Challenges
III. Governance Approach
IV. Transforming the Organization: Key Initiatives
V. Tracking Progress & Measuring Benefit
VI. Physician Engagement Strategies
VII. Lessons Learned
VIII. Questions
© 2013 Huron Consulting Group. All rights reserved. Proprietary & Confidential.
60
Today’s Presenters
Mark Mullarkey
Senior Vice President
Texas Children’s Hospital
mwmullar@texaschildrens.org
1-832-824-1262
Dan May
Managing Director
Huron Healthcare
dmay@huronconsultinggroup.com
678-576-0408
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