The Future of Patient Flow Management Practices in the New Era of Health Reform

David J Yu, MD, MBA, FACP, SFHM Medical Director, Adult Inpatient Medicine Service Presbyterian Medical Group ACA: Affordable Care Act ACO: Accountable Care Organizations • “It is anticipated that ACOs will increasingly be reimbursed under a capitated model that incentivizes optimal quality, safety, efficiency, and health outcomes for populations of patients.”

– J. Haugham, MD, D. Burton, MD, HealthCatalyst Value over Volume: Quality over Quantity

• Revenue at Risk • Patient Experience • Complication Consequences • Population Health Medicare Advantage Enrollment Bundle Payments • Payment for Episodes of Care – Hospital cost – Professional fee: all physician charges – Ancillary Service – SNF, Rehab • Middle ground between FFS and Capitation • Based on delivering episode of care at a lower price Payment Transparency

• Commercial Insurance % of Medicare • ? Demise of Hospital Chargemaster

Revenue Center versus Cost Center Patient Flow Traditional View

• ED Physician Process owner • Discharge before noon • Observation units • Push patients up to medicine / surgical floor • Hall beds in ED/ Floor

Patient Flow: Age of ACA

• “A comprehensive, strategic initiative that hospitals need to align all their clinical departments, departmental budgets, and administrative processes around to achieve.”

– Today’s Hospitalist, October 2014, David Yu, MD Patient Flow as a Strategic Initiative

• How do you model financial efficiency in a cost center model? • No revenue generation • wRVU becomes irrelevant • Cost Avoidance • Holy Grail: Better Quality at a Lower Cost • Political shift from revenue generators to process owners

If the rate of change on the outside exceeds the rate of change on the inside, the end is near.

Jack Welch, CEO, General Electric Form Follows Function Form Follows Function

B-52 Linebacker II 1972, North Vietnam 10 planes shot down, 5 damaged

B-2 Kosovo, Afghanistan, Iraq campaign No planes lost nor damaged The Land of Enchantment • Approximately 2 million people • 5th largest state in geographic area • Lowest Commercially Insured • 2nd Highest Medicaid • 2nd Highest Uninsured • Ranked 33rd in overall health status • 22 Sovereign Native American Tribes • Most PhDs per capita • 0 professional football teams

Presbyterian Healthcare Services Hospitals • 8 hospitals in 7 communities • Total of 874 beds in New Mexico Health Plan

• 445,00 members throughout NM • Largest Medicaid carrier • Largest Medicare Advantage carrier • 2nd largest Commercial carrier Medical Group • Multi-specialty group with 770 providers Hospitals • Operates approximately 90 clinics in 44 Outpatient Facilities Presbyterian Administration Center facilities Presbyterian Health Plan Membership Statewide Central New Mexico

Presbyterian Healthcare Services

• Gross Revenue $ 2.7 billion • Revenue at Risk $1.8 billion • Revenue Fee for Service $900 million

Presbyterian Hospital

• Albuquerque, New Mexico • Flagship hospital of PHS • Tertiary Center • 453 Licensed beds • Closed ICU with Intensivists 24/7 • Presbyterian Hospital ED 68,888 encounters 2013, 100,000 entire CDS

Presbyterian Medical Group, PMG Adult Inpatient Medicine Service, AIMS Presbyterian Hospital • 50 FTE requirements • 60 + Hospitalist Attending • 8 RNs, Triage RNs, Cross Cover RNs • 17 Rounding Teams, 4 Admitting Swing Shifts, 3 Over Night Shifts, 2 Triage Shifts. • Presbyterian Hospital, Albuquerque, NM, Inner City Tertiary Center, 453 beds • AIMS performed 16,500 discharges 2013, 18,750 discharges in 2014 • Admits and discharges 80 to 150 patients per day. Peak volume records:85 admissions with H&P in a 24 hour period, 80 discharges in 12 hours.

Prior to Patient Flow Process Journey

• Left Without Being Seen Rate in Presbyterian Hospital ED >10% 2009 • Regional hospital transfers to PH took average days not hours, patients frequently transferred to Denver, Phoenix, El Paso, Amarillo • ED patient boarding • ED ambulance bypass • Adult Inpatient Medicine Service (AIMS) aLOS 5.06 in 2009

Hospitalist’s Contribution to Patient Flow: Reduction of aLOS Presbyterian Hospital ED LWBS

12% 10% 8% 6% 4% 2% 0% 2008 2009 2010 2011 2012 2013 2014 Year PMG AIMS Discharge per Month Discharges 2010 - 2015 1,900

1,800

1,700 2010 1,600 2011 1,500 2012 1,400 2013 1,300 2014

1,200 2015

1,100

1,000

900 Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec PMG, AIMS: Bending Cost Curve

Controllable Cost/Discharge $1,100

$1,050

$1,000

$950 Ave Ave Cost $900

$850

$800 2009 2010 2011 2012 2013 2014 2015 Year Patient Flow as an Integrated Process

• Integrated processes • Breaking Down Financial Silo • “Sucks to be you!” –Principle. The system as a whole suffers. Individual departments rewarded. • “When there is no Vision, the People perish”. Proverbs, KJV. aLOS • Average Length of Stay and Budgeted Bed Capacity determines patient flow. • ED Flow = Upstairs bed availability • Hospitalists and Hospitalist Groups play a major role. • Ancillary Services, Specialists, Nursing, Care Coordination play critical role. • Rough proxy of variable cost per case. aLOS / Variable Cost per Discharge Not all aLOS is the same!

• Patient A: Community acquired pneumonia. LOS 4 days, variable cost of hospitalization $8,500 dollars. • Patient B: Community acquired pneumonia. LOS 5 days, variable cost of hospitalization $2,500 dollars. • Which one would you choose? Variable Cost per Case

• Tremendous Cost / Savings Effects • 20,000 discharges X ______= • Ask CFO, “Do you want save a dollar or earn a dollar?”

Data vs Analytics MPG versus Cents Per Ton Mile 4 mpg 5 cents per ton mile

38 mpg 52 cents per ton mile Discharge Efficiency • Discharge as a Percentage of Starting Census • Small change means huge difference – 20% aLOS 5.0 days – 23% aLOS 4.35 days (3%= 0.65 days reduction) – 25% aLOS 4.0 days

Discharge Efficiency/ aLOS

4.9 29.00%

4.7 27.00%

4.5 25.00%

4.3 23.00% aLOS Discharge Efficiency 4.1 21.00%

3.9 19.00%

3.7 17.00%

3.5 15.00% Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Census per Team / Discharge

15 28.0% 27.0% 14 DC/ Starting Census % 26.0% 25.0% 13 24.0% 12 23.0% 22.0% Starting Census Average 11 per Team 21.0% 20.0% 10 19.0% 9 18.0% Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec AIMS Average Starting Census per Team Average Team Census 2014

Average of Starting Census Month Grand Team Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total Diamond 16.00 14.32 14.68 14.77 14.16 16.16 12.35 11.94 11.80 12.58 13.13 13.61 13.71 Emerald 13.77 13.43 12.77 13.10 13.79 14.00 12.21 12.26 12.47 13.03 12.43 13.23 13.04 Gold 14.32 12.11 13.45 12.97 11.84 14.37 11.29 11.10 11.00 12.65 12.03 13.55 12.54 Gray 15.74 14.04 11.93 13.13 12.10 13.47 11.32 10.45 11.30 12.74 12.58 14.48 12.77 Green 14.68 14.18 12.68 13.32 13.16 12.46 13.19 11.55 11.63 13.00 13.48 13.16 13.04 Indigo 13.48 12.75 12.42 12.70 13.23 12.87 11.45 11.29 11.70 13.48 13.10 12.58 12.59 Jemez 14.10 12.86 12.97 12.55 11.68 12.83 11.10 12.32 11.20 12.10 11.47 13.00 12.35 Lavender 13.93 12.86 13.13 12.46 13.06 15.70 11.71 12.06 12.00 13.00 12.13 12.39 12.87 Pecos 13.48 13.04 12.90 12.47 11.59 13.37 11.26 10.87 10.60 12.68 11.30 12.29 12.15 Platinum 14.26 12.82 12.03 11.83 12.13 14.50 11.29 10.71 10.80 12.68 12.13 12.84 12.33 Purple 13.42 12.86 13.00 12.60 13.42 14.83 12.16 12.94 11.77 12.90 12.40 12.48 12.90 Ruby 14.71 13.00 12.68 12.87 13.10 14.17 11.61 11.32 11.50 12.90 12.53 12.65 12.75 Sandia 13.55 11.43 12.45 13.30 12.94 12.83 12.10 10.29 10.17 12.00 11.10 12.84 12.09 Silver 13.71 12.11 12.39 13.87 10.10 13.37 11.00 11.10 11.07 13.00 11.87 11.52 12.09 Steel 8.45 5.54 6.23 6.07 6.03 6.00 5.61 5.52 5.37 5.32 5.30 5.29 5.90 Topaz 14.06 13.64 12.68 12.25 12.32 14.00 11.48 11.06 11.27 13.10 11.87 14.19 12.64 Violet 14.65 13.43 13.71 12.50 11.84 14.57 12.16 11.55 12.30 12.77 11.97 12.19 12.80 White 13.82 14.58 11.74 14.17 11.10 13.16 Grand Total 13.90 12.68 12.60 12.48 12.25 13.44 11.37 11.08 11.06 12.35 11.80 12.49 12.28

Inpatient Days Per Rounding Team

• New metric to measure productivity and patient turnover • Nursing midnight census • Census average for hospitalist

aLOS per Month

AIMS aLOS Admission and Obs 4.80

4.60 2011 4.40 2012 2013 4.20 2014 2015 4.00

3.80

3.60 Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec Year end aLOS Patient Experience Score Ranking Perverse Incentive, Unintended Consequences: The Great Hanoi Rat Massacre

Hospitalist Perverse Incentive Not to Discharge: wRVU Trap • Hospitalist enjoy high compensation but work load is unstainable, with daily census 20 to 28 patients to maximize wRVU • Specialist centered • Level loading census • Caps • High census leads to discharge inefficiency Increased Hospitalist Workload leads to Increase Length of Stay • Increasing Hospitalist Workload Linked to Longer Length of Stay, Higher Costs – Elliot D, et al, JAMA. March 31, 2014

• Result: Length of stay (LOS) increased as workload increased, particularly at lower hospital occupancy. For hospital occupancies less than 75 percent, LOS increased from 5.5 to 7.5 days as workload increased and for hospital occupancies between 75 percent and 85 percent, LOS generally remained stable with lower workloads but increased to about eight days at high workloads. Costs rose with increasing workload and occupancy, with each additional patient a physician saw increasing costs by $262. Increasing workload did not affect other outcomes including mortality, 30-day readmission or patient satisfaction.

Other Industries Who Have Chosen Quality over Quantity Perverse Nursing Incentive Perverse Nursing Incentive Not to Discharge Discharges Lead to More Work

• Hiding Beds • Delay Discharge • Delay Transfers • Poor Communication

Nursing Solutions

• Centralized bed control • Processes to standardized communication: – Unit Base Rounding with Multidisciplinary Rounds • Appropriate resources to meet volume demands: – ADT Nursing Program Cost Shifting • If your Care Coordination to Patient Ratio is 40:1 who is doing the Care Coordination?

Hospitalist $ 120 per hour Care Coordinator $ 40 per hour

Innovative ED Disposition Options

• Triage and medical stabilization of patient for disposition. Mission creep of ED. – Discharge home – Admit to hospital – Observation placement – Hospice – Hospital at Home – Patient Navigation to out patient clinic setting (Care Coordinator / Social Worker in ED)

ED Pull versus Push • ED can be cleared by pushing patients upstairs but at cost of quality • GM 9 months of inventory • Toyota 3 weeks of inventory • Push / Pull patients from ED to floor. • Clearing the ED versus process throughput.

Scheduling 3.0 2.5 2.0 1.5 Jan '09 Mar '09 1.0 May '09 0.5 0.0 Scheduling • Maximize Surface Area for Admissions • Maximize Continuity of Care, Min 5 day rounding cycle • Schedule to the work, and not for physician convenience • No scheduling difference between weekends and weekdays. • Staff to the work • Flex up in winter/ influenza season • Country Club practice attitude of specialists Data to Support Scheduling

2011 2012 20 2013 2014

0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Process, Process, Process: Lean Six Sigma Unit Base with Multidisciplinary Rounding

• Quality is imbedded in a process. • Definition of Quality: not regulatory compliance • Reduction of variation and continuous improvement of a process • Standardization: How many ED groups do you have? How many hospitalists groups do you have? • Do you have a “PROCESS”? Process, Process, Process: Lean Six Sigma Unit Base with Multidisciplinary Rounding

• PMG/AIMS: If we were a factory, we are in the business of producing a “discharge”. • Evidence Based Management Principles: Lean Six Sigma – When people and organizations focus primarily on quality, quality tends to increase and costs fall over time. – However, when people and organizations focus primarily on costs, costs tend to rise and quality declines over time. – “Every activity and every job is a part of the process”, W. Edwards Deming – “There are no bad workers, just bad management”, W. Edward Deming

Pre Assembly Line: 12.5 hours prod cost $825. Post Assembly Line: 1.5 hours prod cost $240. Process, Process, Process: Lean Six Sigma Unit Base with Multidisciplinary Rounding • Patient Centric Care • Team effort, Whiteboard multidisciplinary rounds led by Charge Nurse • Reduces paging, phone calls, and communication inefficiencies • Builds relationships and coordinated effort • Instant sharing of information between multidisciplinary members. • “What’s in it for me?” • Goal of Process was never mentioned to staff!!!!!!!!!

Lean Six Sigma Unit Base with Multidisciplinary Rounding UB 1 IMC (4th Floor) GMU 1 (4th Floor) 9:40 Violet 9:40 Lavender 9:50 Lavender 9:50 Violet 10:00 Indigo 10:00 Purple 10:10 Purple 10:10 Indigo UB 2 APC 2 (7th Floor) GMU 2 (4th Floor) 9:40 Diamond 9:40 Emerald 9:50 Emerald 9:50 Diamond 10:00 Topaz 10:00 Ruby 10:10 Ruby 10:10 Topaz UB 3 APC 1 (7th Floor) GAC (5th Floor) 9:40 Silver 9:40 Platinum 9:50 Platinum 9:50 Silver 10:00 Gray 10:00 Gold 10:10 Gold 10:10 Gray UB 4 CPC (7th Floor) PHG Rounds White Board Rounds Jemez 9:30 - 9:40 9:40 - 9:50 Pecos 9:40 - 9:50 9:50 - 10:00 Sandia 9:50 - 10:00 10:00 - 10:10

Flex Teams (Non Unit Base) Green, White Whiteboard Multidisciplinary Rounds Lean Six Sigma Unit Base with Multidisciplinary Rounding Quality Projects Difficult to Publish in Scientific Journals • Strict adherence to initial protocol to validate the P value • Collection of “clean data” is paramount • No mechanism for rapid review and change of process • Anathema to PDSA (Plan Do Study Act) • Annals of Internal Medicine, Oct 7 2014 – Improvement Interventions are Social Treatment, Not Pills – Frank Davidoff, MD

Why Most Hospital Patient Flow Improvement Projects Fail:

• Must answer question, “ What’s in it for me?” Culture Eats Strategy for Lunch • Was additional resources considered to improve process? • Quality is not free. “Return on Investment”. • Does it add another burdensome layer for the clinical staff? • There are no bad workers, just bad processes and bad management. Why Most Patient Flow Projects Fail: Conclusion

• Are you revenue or cost focused? • Is Patient Flow an Integrated Strategic Process? • Is Patient Flow Processes properly budgeted? • Are all hospital departments and individual disciplines aligned for Patient Flow? • Are the right metrics being measured? • Do you have a Process?

Questions

• How do changes in the care reimbursement model caused by healthcare reform affect hospitals? • How does leveraging multidisciplinary patient flow initiatives help hospitals remain financially competitive? What is one way this could be implemented in your medical center?