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PROVIDER ENGAGEMENT

Featured Member Case Study:

Measure Twice, Cut Once Organizational Alignment the Key to Cost Savings

Pratt Vemulapalli

Clinical Director

Lavanavarjit Ragavan

Performance Improvement Manager

Jason Smith

Associate Director

Jennifer Lam

Senior Project Manager

©2015 The Advisory Board Company • advisory.com

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Montefiore

Medical Center

Five-facility health

system in

Bronx, NY

Surgical Profitability

Compass

member since 2013

©2014 The Advisory Board Company • advisory.com

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3

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Road Map

Measuring Results and Scaling the Process

From Doubters to Disciples

Our Strategic Evolution

©2015 The Advisory Board Company • advisory.com

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Transforming a Clunky and Time-Intensive Process

Tedious

Data collection was manual

and required multiple hours

of report generation

Deficiencies in Data Collection Process

One-Sided

Unable to tie certain metrics

together and assess impact

(e.g. linking purchasing data

to operational performance)

Seeking: A higher level tool to identify tactics for

standardization and which initiatives to prioritize

Not Credible

Physicians pushed back on

data and did not change

behaviors accordingly

©2015 The Advisory Board Company • advisory.com

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But was it a false god?

Surgical Profitability Compass – Our Savior

The Challenges of Implementing a New Technology

Value Proposition Perception of Viability

• Explosion of available data

• Operations + Finance + Supplies

• Internal variation

• External comparisons

• General distrust of data

• Not the first time

• Information overload

• Organizational readiness

Intense need for alignment of

executives, surgeons, OR and materials

Skepticism Disruptive Change

©2015 The Advisory Board Company • advisory.com

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The Seven Stages of Surgical Profitability Compass

Early Days

Shifting Reality of Surgeon Engagement

Future

Uninformed Instrumental

Transition

• Denial

• Anger

• Bargaining

• Grief

• Acceptance

• Hope

• Action

From doubters to disciples.

©2015 The Advisory Board Company • advisory.com

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We’ve been through the journey, so here is some advice.

A Word from our “Sponsor”

Data Expectations

• Data is never perfect

• Data is directional

• Data must be actionable

Key Elements for Success

Persistence

• Keep asking questions

• Create competition

• Keep pushing out data

Seeking Input

• Ask your surgeons

• Ask executives

• Ask your DA

Key Strategy

• Open up Procedure Cost Manager live in data-drive conversations to allow for

real-time adjustment of data, e.g. removing outliers, changing comparison sets.

• This opens up the door for a conversation around opportunity, not data.

©2015 The Advisory Board Company • advisory.com

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Identify groups of surgeons as comparison sets and discuss common

drivers of variance by group, not by individual.

Source: Procedure Cost Manager, surgical Profitability Compass 2015

Indisputable Comparisons

©2015 The Advisory Board Company • advisory.com

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Use a participative model of sharing item-level analysis.

Assessing Variance in Utilization

Source: Procedure Cost Manager, surgical Profitability Compass 2015

©2014 The Advisory Board Company • advisory.com

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2

3

1

Road Map

Measuring Results and Scaling the Process

From Doubters to Disciples

Our Strategic Evolution

©2015 The Advisory Board Company • advisory.com

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Aligning Goals with Incentives and Culture

Resident / Service Line

Chair Led Initiatives

Value Analysis

Cost Awareness

Triple Aim Initiative

Incentive

Culture

©2015 The Advisory Board Company • advisory.com

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“I will become the lowest cost surgeon”

Cost Awareness

#1. Cost Awareness

A Lesson in Leadership Surgeon chair sets example, takes her cost per

case from highest to lowest in the system

Dr. Pratt’s Cost Per Case From Highest to Lowest

©2015 The Advisory Board Company • advisory.com

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Aligning cost reduction, quality, & satisfaction.

IHI Triple Aim Initiative

Image from IHI Triple Aim web page

#2. Triple Aim Initiative

Key Elements:

• Surgeons financially incented via

Per Capita Cost Dimension

• Bi-annual payouts based on KPIs

• Cost reduction aligned with quality

and patient satisfaction

• Started in Orthopedics, CT, ORL

Population Health

Experience of Care Per Capita Cost

Triple Aim

©2015 The Advisory Board Company • advisory.com

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Giving residents ownership of cost savings.

Resident/Service Line Chair-led Initiatives

#3. Resident / Service Line Chair Led Initiatives

Resident finds cost

savings opportunity

Resident shares

findings with surgeons

Service line sees

significant savings

Learning Opportunity for Residents Yields Significant Savings

©2015 The Advisory Board Company • advisory.com

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Leading targeted value analysis effort.

Value Analysis

#4. Value Analysis

Savings targets set by perioperative

leadership

Individual performance tied to savings

via utilization and price negotiation

Using benchmarking to maximize

savings by switching vendors on high

volume items

©2014 The Advisory Board Company • advisory.com

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2

3

1

Road Map

Measuring Results and Scaling the Process

From Doubters to Disciples

Our Strategic Evolution

©2015 The Advisory Board Company • advisory.com

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$10,790

$17,173

$32,000

$48,853

$56,022

$270,869

$300,000

$309,244

$315,000

$454,000

$754,563

Mesh Standardization

Ligasure Substitution Ph1

Lifecell Negotiated Pricing

Eithicon to Covidien Ligation Loop Substitution

Liegasure Substitution Ph2

Lap Chole Cost/Case Reduction

Orthobiologic Standardization

Covidien Venous Solutions Negotiated Pricing

Alcon Negotiated Pricing

Ligasure Substitution Ph3

Hemostatic Sub & Negotiated Pricing

Lap Chole Supply Cost per Case

$1,448 $991

Jun13-May14 Jun14-May15

Year over Year Cost Reduction

$2.6M in Realized Savings Over 14 Months

Return on Investment of 14:1

Savings from Cost Per Case Reduction June 2014-August 2015

20.2M

©2015 The Advisory Board Company • advisory.com

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Expanding to All

Service Lines

Scaling the Process

• Demonstrate the process of

opportunity identification

• Set targets for service line

• Provide training for residents

• Measure performance

Preparation

• Top procedures by

variance opportunity

• Top procedures by

highest volume

• Initial assessment vetted

by department chair

Scheduling

• Leverage existing service line

department meetings

• Create separate meeting if

opportunity is limited to small

number of surgeons

Pilot Service

Lines

Incorporate

Best Practices

Engage

Leadership

Engage

Materials

Demonstrate

Success

Execution

©2015 The Advisory Board Company • advisory.com

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Questions and Discussion