Health Care Processes

1. Have a perspective on the unique operations and supply management (OSM) challenges faced in health care.

2. Understand how selected OSM concepts and approaches can be applied to hospitals.

3. Understand important health care terminology as it relates to OSM decisions.

Health care operations management: the design, management, and improvement of the system that deliver health care services

Health care as a service◦ Extensive customer contact◦ Wide variety of providers◦ Life or death as outcomes

Key focus is on hospitals◦ Hospital: a facility whose staff provides services

relating to observation, diagnosis, and treatment of patients

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Key operators are highly trained professionals◦ Generate requests for service◦ Deliver the service

Relationship between prices and performance is not direct

No single line of command◦ Balance of power between groups

Product specifications are often subjective and vague

Not a commodity that can be stocked◦ Resource-oriented service organization

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General hospital/emergency room Specialty Psychiatric Rehabilitation

(American Hospital Association classification)

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The layout sets the physical constraints on operations

The goal of layout is to move patients and resources to minimize wait and transport time

A general rule is to separate patient and guest traffic from staff traffic

Principal element is the nursing station Flow of work through a hospital is called a

care chain

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A major distinction among health care processes is the extent to which resources can be scheduled efficiently

Emergency situation must be dealt with immediately◦ Inherently inefficient

Elective procedures can be scheduled to achieve efficient use of resources

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Resource use and schedule complexity are effected by:◦ The number of steps◦ The time of each step◦ Whether the care chain has a definite end

Complexity is also increased by:◦ The need for rapid diagnostics◦ Extensive consultation◦ The need to work with other specialties

Decoupling points: steps in the process where waiting takes place

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Radio frequency identification: uses electronic tags that can store, send, and receive data over wireless frequencies

Used to track the location of:◦ Patients◦ Medical staff◦ Physical assets

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Patient flow◦ Improvement of patient check-in process◦ Tighter links between patient and medical records

Physical assets◦ Pinpoint location of equipment◦ Save time rounding up equipment

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Capacity planning: matching an organization’s resources to demand

Resource requirements is a function of:1. Number of patients2. Length of stay

Capacity is measured in terms of multiple resources including

◦ Beds◦ Clinics◦ Treatment rooms◦ Doctors◦ Nurses◦ And more

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Starting point is determining the effective capacity of a resource

Effective capacity = Design capacity X Utilization Subsequent steps:

1. Forecasting patient demand2. Translating this demand into capacity requirements3. Determining the current capacity level4. Calculating the gap between demand and capacity5. Developing a strategy to close the gap

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Nurse shift scheduling◦ Largest component of hospital workforce◦ Schedules can be classified as either:◦ Cyclical schedule

The work is planned for four-to-six weeks Nurses work a fixed schedule

◦ Flexible schedule Several types are used Most common is 8-hour days and an average of 40 hours

per week Operating room scheduling

◦ Typically largest revenue-generating center

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TQM approaches have been used for decades◦ Hospitals are well suited because so much of

health care involves precise measurements Six Sigma and Lean concepts are being

instituted in may hospitals

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Gap errors: information mistakes that arise when a task is transferred between people◦ Handoffs are a significant source of serious patient

harm◦ One successful approach to managing handoffs is a

checklist technique for communicating information Bottleneck: part of the system that has the

smallest capacity◦ Frequently result from departments optimizing their

own throughput

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Hospitals have been raising their level of customer service

Improved customer service saves money◦ Fewer malpractice suits◦ Reduction in no-shows◦ Lower nurse turnover

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Computerized physician order entry (CPOE) systems are widely used for prescriptions

Experts propose broadening their application to include scheduling all resources needed to treat patients

The admission order triggers a series of follow-up events that are automatically entered into the system

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Average inventory for a medium size hospital is $3.5 million

◦ Represents 5-15 percent of current assets 2-4 percent of total assets

◦ Largest working capital requirement Hospital inventory systems can be broken

down into two categories1. Push systems

1. Fixed-order quantity systems2. Fixed-time-period systems

2. Pull systems

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A major distinction between health care inventory management and other businesses is safety stock

The standard calculation of safety stock is based on trading off the cost of carrying additional inventory with the cost of being out of stock

This is much trickier in a hospital when the cost of a stockout might be death

For critical items, backup contingency plans such as borrowing from a nearby hospital are often developed

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Evidence-based medicine (EBM) Integrated medical care Electronic medical records Health information exchanges (HIE) Computer-assisted diagnostics Remote diagnostics Robots

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