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August 01, 2008


Scott Hodson

My Firm's point of view is that to truly "move the needle" on cost and quality, an organization must begin by clearly defining and measuring it, and then making the results available to trustees, employees, physicians and the general public. Transparancy is essential to achieving significant lasting improvement in quality and patient safety.

While there is no standard healthcare industry definition of what constitutes "quality," we have found that top healthcare performers adopt a composite of measures that consider:

Clinical Outcomes: Ultimately it is the outcome that matters most. Risk adjusted healthcare quality measures such as inpatient mortality rate, readmission rate, complication rate are commonly accepted indicators of quality outcome success.

Clinical Process: Effective clinical processes are essential to achieving superior healthcare quality outcomes. At a minimum, current publicly reported "core measures" should be considered. Evidence based physician order sets and clinical care plans provide a rich assortment of additional quality process measures.

Patient Experience: Effective communication with caregivers, environment, and customer service are an important part of an effective treatment program. The medicare Hospital Consumer Assessment of Healthcare Providers and Systems is one good source of useful performance data.

Resource Utilization: "Too little" or "too much" care can adversely affect outcomes. Measures such as risk adjusted average length of stay, ICU ALOS, and cost per case are examples of effective resource utilization indicators.

Top performing organizations not only define and measure healthcare quality, they ask the question: "How are we doing? We believe that the best way to answer that question is to compare your results to those of "Top Performers." There are a number of organizations that provide excellent health care industry clinical quality and financial benchmark information. Through benchmarking, organizations are able to identify their strengths and weaknesses, and develop strategies to address and overcome healthcare quality gaps.

Benchmarked performance ratings on individual measures can then be weighted and rolled up to measure overall quality performance for individual conditions (e.g. pneumonia vs. AMI, individual hospitals within a health delivery system, or a system - wide composite score.

Finally, true improvement occurs when "stretch" goals are established by Board of Directors, and hospital management incentives are tuned to the achievement of those goals. We have seen breakthrough improvements in quality and patient safety when this approach is used to identify and address problem areas.

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