"We see care variation initiative as the next frontier in improving overall quality and significant cost reduction across the system through physician leadership," said Michael Ugwueke, president of Memphis, Tenn.-based Methodist.
Methodist took an incremental approach to standardizing care, starting with unwarranted variation in utilization of laboratory tests and packed red blood cell transfusions in 2014 and working its way up.
Embedding consistency in clinical operations to reduce unnecessary care has been a tough task for providers since it requires authoritative direction from leadership, buy-in from physicians, and accurate and actionable data. These efforts are often fragmented, lacking the proper infrastructure and data.
It is at the top of mind of C-suite health system executives whose priorities are preparing for sustainable cost control and finding innovative approaches to expense reduction, according to a recent survey from Advisory Board, an Optum company. The focus on reducing clinical variation has birthed a cottage industry for consultants and device manufacturers that are quick to offer providers their data aggregation services.
While aligning clinical operations can be more difficult than staff cuts or renegotiating contracts with vendors and service providers, it can significantly impact a hospital's bottom line, according to a new Advisory Board analysis of discharge data from more than 20 million de-identified patients compiled between 2014 and 2017 from 468 hospitals.
A typical hospital spends up to 30% more than its top-performing cohort to deliver care with comparable or lower-quality outcomes.
Closing just a quarter of the cost gap for less than 10% of the 983 conditions Advisory Board analyzed could yield more than $4 million in annual savings for a typical hospital, without compromising quality, said Steven Berkow, executive director of research at Advisory Board.
"If we could change the growth rate of costs by 3% to 4%, that would have a dramatic impact on bending the healthcare cost curve," he said.
Take ambulation, the clinical term for walking, after surgery. It's best to get a patient up and walking within a certain time frame after surgery.
The care standard at one hospital was that a physical therapist helps a patient walk, but that posed problems for afternoon surgeries when physical therapists had already clocked out. Rather than extend physical therapists' hours, the hospital trained registered nurses to step in when a physical therapist couldn't.
Often times clinical variance comes with the assumption that it stems from doctors' disagreeing about treatment protocol or what equipment to use. But typically, it is a process, awareness or resource question, not a debate about what is the right clinical specification, Berkow said.
"We have to make best practices the path of least resistance," he said.
Doing so will directly impact employee satisfaction rates and turnover, which address a hospital's biggest expense, said Dr. Veena Lanka, senior director of research at Advisory Board.
"When you take into account the complexity of the turnover rate of staff, the importance of standardization manifests," she said.
Hospitals should move away from isolating a doctor that is a high cost outlier for a certain procedure. Normalize care around one standard instead, Berkow said.
Equip members with powerful analysis that conveys how high-quality hospitals are delivering care most effectively through reducing variation. Narrow the focus on certain disease states and progress incrementally.
Typically this requires executive leaders to do more than just delegate, Berkow said. Hospitals also need to convince not just physician executives but rank-and-file clinical staff that standardizing clinical operations will generate savings with no trade off in quality, he said.
Organizations that are doing it well are not just standardizing care for treatments, they are standardizing the process for standardizing care, Berkow said.
"I haven't seen anything else that can simultaneously impact cost and quality on this scale," he said.