“If you're using quality metrics to measure the care that you provide, your rates of mortality, healthcare-acquired conditions and readmissions are all going to be much improved, and those are the things that add to the cost of healthcare,” Vinyard said. “It follows that your financial results will be stronger.”
That's also been true at Illinois hospital system Advocate Health Care, which made Truven's 15 Top list for the fifth time in the large health system category. Despite rising expenses, Advocate's 2013 operating surplus topped $300 million, up slightly from $298 million in the previous year. Revenue rose 7.4% to $4.94 billion, giving the system an operating margin of 6.1%.
For the same year, Advocate also reported that six of its 11 facilities had no cases of central line-associated infections. Executives credit that success to the application of best practices across the system. After noticing that the intensive-care unit at Advocate BroMenn Medical Center in Normal, Ill., had gone more than six years without a central line-associated blood stream infection, leaders took practices from that hospital and put them into effect at their other facilities.
Such systemwide sharing has also been a recent key to success at Asante, where Vinyard says they try to apply studies of their practices, including their look at wait times in the emergency department, from one location to the others. “That's beginning to pay big dividends because it's much better to look at a process one time than three times,” he said.
Though it's an important lesson for systems of all sizes, it could be especially important in the case of a small system such as Asante. Truven's analysis showed that small systems are, in general, weaker financially than larger systems—not surprising given their more limited resources. The operating margins of the winning small systems were slimmer than those of the winning large systems. Smaller systems were also more leveraged than the group of large systems, those reporting more than $1.5 billion in operating expenses.
But finding the right balance between long-term debt and capital can be a balancing act for a system, no matter the size, executives said.
“When we are planning new facilities, programs, services or capital purchases, we really have to look both at what the patient-care implications are and what the financial implications are,” Vinyard said. “But generally speaking, if it's the right thing to do in terms of patient care, then I think there's a tendency to be able to make it work.”
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