The nations manufacturers, struggling with the high cost of healthcare, are taking matters into their own hands by working directly with hospitals on a possible collaboration to improve efficiencies and reduce waste.
Leading manufacturers are in talks with the American Hospital Association to launch what is being dubbed a Marshall Plan to bring best practices developed on the shop floor to the hospital floor.
While some hospitals have adopted methods developed by manufacturers such as Toyota Motor Corp. and Motorola to reduce waste and improve efficiencies on their own (May 2, 2005, p. 32), the collaboration under discussion would go much further by creating a formal nationwide partnership to share best practices.
Toyota brought Lean manufacturing to the United States and we had to get up to speed quickly to stay competitive, said Jeri Gillespie, vice president of human resources policy at the National Association of Manufacturers, or NAM. Right now we are exploring what needs to be done (in healthcare) and how can we extend that knowledge and expertise.
Gillespie used the term Marshall Plan to indicate the wide scope of this potential collaboration and the goodwill of manufacturers that might be involved. The Marshall Plan was the U.S. reconstruction program that provided billions of dollars in funding and technical assistance to Europe after World War II.
Gillespie and officials from the AHA presented the idea to NAM board members, who include chief executives from Fortune 500 companies, during the last week in September and it was warmly received, according to those involved. We all benefit from lower healthcare costs, Gillespie said.
The AHA sees the collaboration as being modeled after United Ways Loaned Executive Program, in which firms donate managers time to raise funds on the charitys behalf. In this case, manufacturers would donate systems engineers time to local hospitals. Were not asking them to tell us how to practice medicine, said Stephen Mayfield, director of the AHA Quality Center. But they can come in with fresh eyes to see opportunities for improvement.
Manufacturers can help hospitals in four areas: improving patient flow, removing wasteful practices, reducing harm and lowering process variability, Mayfield said. One example would be reducing the number of steps a nurse takes to reach carts and supplies. In exchange, hospitals could help manufacturers, often the largest employers in a town or region, develop wellness and prevention programs.
This isnt as easy as it sounds. Taking best practices from manufacturing and applying them to healthcare requires an understanding of the nuanced differences between the two fields, said Scott Regan, healthcare practice lead at the Juran Institute, a consulting firm. One is Toyotas Lean method, which uses tools that target process constraints, waste and nonvalue- added activities and embodies the Japanese term kaizen, which means continuous improvement. Motorolas Six Sigma is a set of practices to improve processes by eliminating defects.
The real danger is underestimating the cultural differences between healthcare and manufacturing, Regan said. People can get very frustrated and give up too quickly.
Details of the collaboration are expected to be fleshed out later this fall, those involved said. Larry Boress, president and chief executive officer of the Midwest Business Group on Health, wondered whether hospitals without a local manufacturing presence would benefit. But anytime you can bring in people to improve efficiencies, thats a good thing, Boress said.
Virginia Mason Medical Center in Seattle started applying Toyotas Lean method in 2002, and has sent 200 employees to Japan for training. Since then, the 307-bed hospital has freed up 11,000 square feet of space, saved $11 million in capital expenditures and reduced laboratory result wait times by 85%, according to the hospital.