NordDRG full version basedNordDRG full version based productivity reportingproductivity reporting

Jorma Lauharanta

Director ofHelsinki University Hospital Area

Nordic Casemix Conference 2010

Meilahti campus

Cathedral

We are here

Olympic stadium

InputResources

Output Visits Episodes etc

Effectiveness Health gain

Productivity = output/input

The goal is health gainThe goal is health gain

Jorma Lauharanta

No health gain

How to increase?

How to minimize?

Jorma Lauharanta

Somerejected

Productivityimprovement

Evaluation ofeffectiveness

Application oftreatment methods,

health technology

Maximalhealth gain

How to maximize health gain?How to maximize health gain?

(with moderate costs)

Requirements for productivity improvementRequirements for productivity improvement

A. Productivity measurement and monitoring system

B. Productivity development programme some important items: 1. improvement of process fluency 2. increase in labour productivity 3. increased efficiency in use of capacity and use of space 4. elimination of overlap, centralisation, and economies of scale 5. new operating models

etc.

Productivity support in HUCHProductivity support in HUCH

• Long-term productivity development programme created

• Clinicians/ clinical managers’ accountability increased -> new management system

• Clinicians receive monthly reports of intermediate product utilization -> intermediate products per DRG group -> product level price-cost reports -> feedback about cost effects of clinical decisions

• DRG-based productivity reporting

Price – cost comparisonsPrice – cost comparisons

1 2 3 4 5 days

Co

sts

/ d

ay

250

500

750

1000

1250

1500

1750

euro

s

basic care at the ward

procedure

rtg

pathology

Accumulation of the patient related costsAccumulation of the patient related costs

lab3 750 euros

Sum of intermediate products:

inexpensive

“trimmed” average DRG cost

various total costs per individual patients

“untrimmed” average

II phaseoutliers< - 2 SD

II phaseoutliers> +2 SD

I phaseoutliers > +3 SD

I phaseoutliers< - 3 SD

Jorma Lauharanta

expensive

cost per patient

Determination of the average DRG costDetermination of the average DRG cost(-> billing price, DRG weight)(-> billing price, DRG weight)

Kustannusjakauma /1-11/2009/sisätaudit/hoitojaksot

DRG 112D Sepelvaltimon laajennushoito infarktittomassa komplisoit.tilanteessa

15001- 49999 EUR

10001- 15000 EUR

6001- 10000 EUR

4001- 6000 EUR

3001- 4000 EUR

2001- 3000 EUR

1501- 2000 EUR

1001- 1500 EUR

0 20 40 60 80

outliers

outliers

- 1 SD = 2 933 euro

+ 1 SD = 9 286 euro

billing price 5 190 euro

Cost Cost distribution of DRG 112Ddistribution of DRG 112D

PCI w/o myocardial infarction w cc

Cost distribution/1-11/2009//sisät/hoitojaksot

DRG 112D Sepelvaltimon laajennushoito infarktittomassa komplis tilant

15001- 49999 EUR

10001- 15000 EUR

6001- 10000 EUR

4001- 6000 EUR

3001- 4000 EUR

2001- 3000 EUR

1501- 2000 EUR

1001- 1500 EUR

0 50 100 150 200

billing price 5 190 euro

- 1 SD = 2 933 euro

+ 1 SD = 9 286 euro

outliers

outliers

BillingBilling distribution of DRG 112D distribution of DRG 112D

PCI w/o myocardial infarction w cc

NordDRG-group cost limits: mean + 2SD

lowerlimit 1 500 €

upperlimit4 500 €

Mean cost= billing price3 000 €

= outlier

totalcost/€

Treatment cost vs. surplus/deficitTreatment cost vs. surplus/deficit

= ”normal process”

surplus deficit no influenceInfluence onsurplus/deficit

Intermediateproducts vsaverage process

little somemore

muchmore

average

Jorma Lauharanta

billed using theintermediate cost sum

billed using the billing price

Productivity measurementProductivity measurement

Determination of the DRG cost weightDetermination of the DRG cost weight

Mean cost of the DRG group

DRG cost weight =

Mean cost of all DRG groups

MethodologyMethodology

1. Production volume1. Production volume DRG weight sum = “DRG points” - sum of DRG weight x number of cases for all DRG groups - same definition for outpatient and inpatient care

- clinical unit employing “short therapy” instead of an inpatient/classic method receives the same cost weight as from the classic method (when number of cases in a NordDRG-O group is increased)

2. Productivity measures2. Productivity measuresa) Overall productivity DRG productivity index - calculated as total costs /DRG point sum = “DRG point cost”b) Labour productivity DRG labour productivity index - calculated as DRG point sum/FTE’s* (person-years)

* FTE = Full Time Equivalent (labour input calculated as ”person years” as if all labour input was produced by full time employees)

Method decribed in Finn Med J 47/2009,4055-4061

Hospital area Department

DRG points

1-12/2008

DRG points

1-12/2009

Labour years w/o psychiatry

1-12/2008

Labour years w/o psychiatry

1-12/2009

DRG points / labour

years 1-12/2008

DRG points / labour

years 1-12/2009

Change %

Medicine 420 317 447 475 2 162 2 199 194,4 203,5 4,7 %

Operative 608 070 636 737 3 140 3 187 193,7 199,8 3,2 %

Women/children 287 403 298 040 1 850 1 881 155,4 158,4 2,0 %

HUCH total 1 315 790 1 382 252 7 173 7 282 183,4 189,8 3,5 %

Länsi-Uusimaa 47 600 47 982 221 224 215,4 214,2 -0,5 %

Lohja 65 613 76 224 359 372 182,8 204,9 12,1 %

Hyvinkää 137 568 145 950 739 752 186,2 194,1 4,3 %

Porvoo 74 405 79 041 324 338 229,6 233,8 1,8 %

Hospital district w/o support serv 1 640 976 1 731 448 8 816 8 970 186,1 193,0 3,7 %

Hospital district ww support serv 1 640 976 1 731 448 13 939 14 266 117,7 121,4 3,1 %

Psychiatry 2 319 2 317

Increase in labour productivity 2009 vs 2008Increase in labour productivity 2009 vs 2008

Increase means improved productivity

Hospital area Department

Costs from book

keeping 1-12/2008

deflat. t eur

Costs from book

keeping 1-12/2009

t eur

Eur/ DRG

point 1-12/2008

Eur/ DRG

point 1-12/2009

Change %

Medicine 310 255 309 130 738,1 690,8 -6,4 %

Operative 406 843 418 124 669,1 656,7 -1,9 %

Women/children 214 708 216 019 747,1 724,8 -3,0 %

HUCH total 932 376 943 171 708,6 682,3 -3,7 %

Länsi-Uusimaa 28 682 28 268 602,6 589,1 -2,2 %

Lohja 42 998 45 493 655,3 596,8 -8,9 %

Hyvinkää 79 575 80 360 578,4 550,6 -4,8 %

Porvoo 41 487 42 706 557,6 540,3 -3,1 %

Total 1 125 118 1 139 998 685,6 658,4 -4,0 %

Overall productivity (DRG point cost)Overall productivity (DRG point cost)change 2009 vs 2008 change 2009 vs 2008 (deflated*)(deflated*)

* Deflated by 1,6 per cent (change in hospital cost index) Descending figure =

improved productivity

NordDRG-group cost limits: mean + 2SD

lowerlimit 1 500 €

upperlimit4 500 €

Meancost3 000 €

= outlier gives one DRG weight!

totalcost/€

Treatment cost vs. productivityTreatment cost vs. productivity

= ”normal process” gives one DRG weight

increasing slightly decreasingInfluence onproductivity

Intermediateproducts vsaverage process

little somemore

muchmore

average

Jorma Lauharanta

strongly decreasing

2008 vs 2007

2009 vs 2008

HUCH (University hospital)Labour productivity +2,9 % +3,5 %Overall productivity* +1,7 % +3,8 %

Hospital districtLabour productivity +2,1 % +3,1 %Overall productivity* +1,6 % +4,0 %

*using deflated costs

Improvement of productivity 2000 - 2009Improvement of productivity 2000 - 2009

Jorma Lauharanta

Overall productivity 1-3 /2010 vs 2009 Overall productivity 1-3 /2010 vs 2009 (not(not deflated)deflated)

Department

DRG points

1-3/2009

DRG points

1-3/2010

Book keeping

costs 1-3/2009

Book keeping

costs 1-3/2010

Eur/ DRG point

1-3/2009

Eur/ DRG

point 1-3/2010

Change %

HUCH Medicine 110 701 109 239 78 315 77 360 707,4 708,2 0,1 %

Operative 163 315 160 212 102 900 106 126 630,1 662,4 5,1 %

Women/chilren 74 368 74 836 54 437 54 203 732,0 724,3 -1,1 %

total 348 384 344 287 235 459 237 545 675,9 690,0 2,1 %

Länsi-Uusimaa 12 456 12 074 7 196 7 310 577,7 605,4 4,8 %

Lohja 17 959 20 248 10 685 12 187 595,0 601,9 1,2 %

Hyvinkää 36 142 35 893 20 212 20 686 559,2 576,3 3,1 %

Porvoo 19 312 19 478 10 493 10 941 543,3 561,7 3,4 %

Total 434 253 431 980 284 045 288 669 654,1 668,2 2,2 %

Descending figure = improved productivity

Clinic group 2010

Cases 2009

Cases2010

Inter-mediate

costs 2009

Inter-mediate

costs 2010

Mean DRG

weigt 2009

Mean DRG

weigt 2010

DRG points

2009

DRG points

2010

EUR /

DRGpoint

EUR / DRGpoint 2010

Inflammation 2 690 3 419 9 226 656 11 164 508 4,57 4,27 12 283 14 574 751 766

Artery 3 491 4 579 16 167 360 20 228 385 6,81 6,05 23 772 27 686 680 731

Emergency 1 464 1 286 5 207 073 4 458 690 5,66 5,67 8 281 7 279 629 613

Cancer 1 376 1 391 7 867 257 8 019 310 7,30 8,97 10 044 12 448 783 644

Total 11 395 10 721 46 846 383 44 008 315 5,80 5,81 66 080 62 217 709 707

DRG point cost in various clinic groups/ DRG point cost in various clinic groups/ Dpt of Medicine 1-4/ 2010 vs 2009 Dpt of Medicine 1-4/ 2010 vs 2009 (not deflated)(not deflated)

Ward episodes:

Descending figure = improved productivity

ClinicCases

2009Cases

2010

Inter-mediate

costs 2009

Inter-mediate

costs 2010

Mean DRG

weigth 2009

Mean DRG

weigth 2010

DRG points

2009

DRG points

2010

EUR / DRG point 2009

EUR / DRG point 2010

GASTROENTER 187 407 503 680 1 036 865 3,91 3,75 732 1 528 688 679

INFECTIONS 694 1 243 3 577 568 4 983 483 4,99 4,52 3 463 5 604 1033 889

PULMOLOGY 1 544 1 553 4 220 661 4 555 465 4,45 4,20 6 873 6 521 614 699

DERMATOL 265 216 924 747 588 695 4,59 4,26 1 216 921 760 639

Total 2 690 3 419 9 226 656 11 164 508 4,57 4,27 12 283 14 574 751 766

DRG point cost in various clinics / DRG point cost in various clinics / Inflammation clinic group 1-4/ 2010 vs 2009Inflammation clinic group 1-4/ 2010 vs 2009

(not deflated)(not deflated)Ward episodes:

Descending figure = improved productivity

DRG DRGCases

2009Cases

2010

Inter-mediate

costs 2009

Inter-mediate

costs 2010

DRG weight

DRG points

2009

DRG points

2010

EUR / DRG point 2009

EUR / DRG point 2010

272 Major skin disorders w cc 11 3 39 378 7 049 5,78 64 17 619 406

273 Major skin disorders w/o cc 50 42 178 054 120 676 5,30 265 222 673 543

283 Minor skin disorders w cc 19 5 85 798 12 871 5,71 108 29 791 451

284A Minor skin disorders w/o cc >16 years114 107 316 354 251 151 3,86 440 413 719 608

Total 194 157 619 584 391 747 4,34 877 682 706 575

DRG point cost DRG point cost per major productsper major products / /Dermatology clinic 1-4/ 2010 vs 2009Dermatology clinic 1-4/ 2010 vs 2009

(not deflated)(not deflated)

Conclusive remarksConclusive remarks

• Support to productivity improvement -> Productivity (both labour and overall productivity) has shown an improving trend since starting its measurement -> Clinicians’ interest in productivity and process management issues increased -> Long-term productivity improvement programme created

• Using the present system -> Impact of various arrangements and interventions on productivity can be monitored without a delay -> successive years can more reliably compared despite a continous shift towards ambulatory treatments

Benefits from the present Benefits from the present productivity measurement systemproductivity measurement system

• proper clinical coding

• clinical protocols in active use

• monitoring objects: -> quality indicators (treatment outcomes, patient satisfaction, complications, readmissions etc.) -> productivity indicators -> process control/ improvement -> staff satisfaction

• optimization of resource utilization: -> in-patient care, intermediate products and control visits

Features of a well-managed clinicFeatures of a well-managed clinic