Why It Matters
As Dr. Don Berwick has written, “reducing waste is by far the largest, most humane, and smartest opportunity for evolving an affordable health care system.”
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Reducing Waste: The “Humane” Path to Affordable Health Care

By Jill Duncan | Tuesday, May 29, 2018

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By 2020, health expenditures will account for over 20 percent of the gross domestic product, and an estimated 20 percent of those current health expenditures can be attributed to waste.

The IHI Leadership Alliance, a dynamic collaboration of health care executives who share a goal to deliver on the full promise of the IHI Triple Aim, took on the topic of waste this year, to learn from each other about how their systems identify and remove waste.

As Dr. Don Berwick has written, “reducing waste is by far the largest, most humane, and smartest opportunity for evolving an affordable health care system.”

Waste is a problem the Leadership Alliance knows well. In many ways, Alliance members are grappling with their role in creating as well as solving the problem. Over the last year, executives have come together in working groups to learn and share their experiences of surfacing waste, exposing variation, and developing broad strategies to accelerate change and share best practices with the rest of the health care industry.

“We are in a system that often rewards waste,” said Dr. Jim Leo, Chief Medical Officer at MemorialCare. “We need to be poised and ready to behave very differently than we are now.”

Through the workgroup, leaders identified three principal ways that health systems most reliably identified and surfaced waste:

Safety events: Participants openly shared that it was often a harm or adverse event that triggered a deeper dive in their organization that eventually surfaced excess procedures or testing. For example, many health systems are working on reducing health care-associated infections as part of their strategic safety initiatives, which then uncover waste.

Efficiency reports: Another common approach was the use of department and organization-wide reports on efficiency, waste and opportunity for standardization, for example, a review of alerts from the Choosing Wisely campaign or labor and expense ratio reports.

Staff and Patient engagement: Lastly, organizations reported engaging their frontline staff, patients, and families in identifying opportunities for waste reduction. Some engaged staff and clinicians through huddles and going to the “Gemba” (a Toyota Production System term for the frontline). Others took a more involved approach such as value stream mapping, kaizen events (continuous improvement), and rapid process design workshops. One example shared by Alliance member Jen Hoople, a Unit Supervisor in Neuro-Telemetry from Providence St. Joseph, was soliciting ideas from staff using “Ease My Day” forms

Another example of how to engage staff and patients is in reducing waste is the Leadership Alliance effort called “Breaking the Rules” week, in which health systems invited staff and patients to submit their ideas on what rule, habits, and policies they would redesign for better care. One health system learned that staff thought it was against the rules to send unused hospital medications home with patients, so they clarified that such medications just needed a new prescription label to be used by patients at home.

In their spring meeting this month, leaders heard from Sarah Kliff, a prominent journalist with Vox, who has been exposing the high costs of health care through a project to investigate readers’ ER bills. One of her most sensational articles described a father who was billed $629 for a Band-Aid for his daughter.

In response, members of the Alliance engaged around the various drivers of cost variation, including an acknowledgment of overuse and misuse of medical care. They also discussed how many of these high costs incurred through unnecessary ER visits, pointing to the need for improving systems to connect patients to the right care at the right time. Nonetheless, tremendous cost variation exists across care settings. Kliff explained that the lack of price transparency in health care contributes to these high costs, since both patients and providers are unable to see and challenge the variation in prices across hospitals and health systems.

“Health care prices are so high because there is no one saying ‘No,’” Kliff explained. “An ambulance ride costs a thousand dollars because it can be a thousand dollars.”

Leadership Alliance members agree on the urgency of continuously reexamining the systematic and strategic approaches to surfacing recognizable as well as unexplored areas of waste. It’s a topic the next cohort of Leadership Alliance members is likely to tackle at the urging of Dr. Don Berwick, who suggested leaders commit to sharing their prices on common, high-cost procedures. Leaders are eager to build on a spending reduction model published by Berwick and Andrew D. Hackbarth in the next year of the program.

Learn more about one way to engage staff, patients, and families in surfacing and describing waste across health and health care systems through a “Breaking the Rules” initiative. Download our free resource guide and learn more about the IHI Leadership Alliance here.

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