Business Advisor - A Few Things We Can Control

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Focus on your facility's economy, not the global one.


focus on what you can control

You can waste your time and energy worrying and wondering about what next month's election will mean for health care and outpatient surgical facilities. Or you can accept this simple fact: Regardless of whether it's Obama or Romney for the next 4 years, the morning after the election, you and your staff will get up and report to work at your surgical facility, doing what you always do. While the politicians posture and the winds of change blow, you should focus on what you can control — those 3 things that always matter in our business: safety, outcomes and profitability. Do that, and the rest, including who's occupying the White House (see "Reader Survey"), will take care of itself.

Safety
The majority of our hundreds of policies and procedures are geared toward ensuring that no one is injured by a visit to a surgical facility. But there's an important economic component to making sure every step from pre-op to discharge is safe for patients: Just 1 malpractice suit can seriously hamper, if not devastate, a facility. Put a patient safety audit on the agenda for the last quarter of the year — it might take you a couple days, but if it prevents even 1 serious event, it'll have been worth the time.

Outcomes
Every case has an outcome, and everything you do in your facility will affect outcomes. What's more: Surgical facilities are going to be paid based on their outcomes. Some in the industry are shaking their fists and saying, "That's not fair! We shouldn't be paid by how the patient experience turns out!" Really? Isn't that what it's all about?

Audit your facility to determine whether your operations are set up for good outcomes. There are 2 sides to examine when you do this.

First, on the patient side, when I go in as a consultant I track the patient experience from the booking at the surgeon's office to the delivery of the final bill. I look at these areas:

  • How do facility staff interact with the surgeon's office on scheduling the procedure and determining proper patient and procedure selection? This very much determines if patients have positive or frustrating experiences.
  • Has the patient been properly counseled pre-operatively so there are no surprises when the bill arrives? Will it be a shock when they see anesthesia, pathology or radiology charges?

Here's what I look at on the facility side:

  • Is the surgeon credentialed to do the actual surgery, with a good track record in this procedure?
  • Did anesthesia do a complete workup on the patient, and consult on the patient's eligibility for the outpatient setting?
  • Were the appropriate pre-op tests ordered, read and interpreted with enough time to adjust the surgical schedule if needed?

Profitability
Safety and outcomes are mainly about patient care but, as noted, do have business components. Profitability is sort of the flipside: You need to take care of fiscal business so you can continue to provide great patient care.

There's too much waste in surgery finances, but that doesn't mean you should be tempted to cut corners. Instead, assess your expenses — 40% to 60% will fall into either supply or personnel costs.

customize your discharge instruction\s

Reader Survey

If the presidential election were held today, how would you vote?

Barack Obama29%
Mitt Romney64%
Undecided5%
Abstain2%

SOURCE: Outpatient Surgery Magazine InstaPoll, September 2012, n=1,308

Supply costs should be tied to production or the number and acuity of cases performed, but take up no more than 30% of your outlay. Audit your invoices quarterly to ensure that what you're paying matches what you were quoted. If a surgeon wants a new piece of capital equipment, have him present the business case. Negotiate the price, and tell him, "This is what buying this will mean for profits. This is the best-case scenario for when we could recoup our money, and this is the worst case." Hard data make it easier for everyone to make decisions.

Personnel costs should also be in ratio with production — no more than 30% of outlay. Almost every facility I visit has a degree of over staffing. Use staff downtime to conduct those safety and outcomes audits, to double-check supply invoices, or price out that shiny new piece of equipment a surgeon wants. On low-census days, offer to let nurses go home early, unpaid, if they don't want to stick around and work on value-added projects. Use the savings to send staff to conferences and to upgrade equipment.