Diagnosing Patient Care

1. Diagnosing patient care
Getting healthy with
benchmarking and
business intelligence
Steven Lugard – Dublin, March 2013

2. Agenda
Central theme:
How can Irish hospitals benefit from benchmarking?
And what is required to get there? Is it possible today?
 Background: Cost per patient in the Dutch DRG System
 What is benchmarking?
 Implementation: Technology & management

3. Some background information:
Cost per patient in the
Dutch DRG System

4. Hospital financing in Netherlands
Until 2005 budget system
Limited impulses for volume/quality/efficiency
Need for cost containment and quality impulse felt strongly by 2002
Waiting lists
Exploding costs (exploding hospitals)
Design of new system: Money Follows the Patient (MFtP)
Case based financing introduced in 2005
Starting 2005, prudent growth model
2007: 18% (Hip/Knee/Cataract)
2013: 80% of hospital care
First Diagnostics Theatre Discharge
consultation Inpatient stay Check-up

5. Cost benchmarking in Netherlands
Trusts have own responsibility for financial performance, thus for adequate
management information.
Need to know own performance vis-à-vis peers
Where are we more expensive or more efficient than our peers?
What is causing us to be more/less expensive? Understanding drivers of these costs.
Taking action; lowering cost prices or lowering activity levels for treating patients
Forecasting costs; budgeting based on contracted production amounts &
benchmark
Early adapters in the Netherlands are now the most successful trusts
Continuous focus on benchmark, but what is it?

6. About Benchmarking

7. Cost breakdown of a DRG

8. Savings in protocols
What can we reach with influencing the clinician’s behaviour?
Protocol Own 289 patients
Category Own Peers Best Potential Unit Unit costs Protocol savings
Implant 1 1 1 - units € 3,156 € -
In patient days 8.3 6.9 6.9 405 bed days € 321 € 129,877
Theatre hours 1:47 1:30 1:30 81:53 hours € 970 € 79,427
Laboratory tests 20 32 20 - tests € 13 € -
Radiology exams 2.5 4.2 2.5 - exams € 102 € -
Physiotherapy 6.3 4.7 4.7 462 sessions € 48 € 22,019
Other treatments 4 3 3 289 sessions € 18 € 5,058
€ 236,380
Cost per patient € 8,426 € 7,932 € 7,608 € 818
Savings % 6% 10%

9. Savings in unit costs
Improving productivity and purchasing conditions adds 10%
Protocol Unit costs 289 patients
Category Best Unit Own Benchmark Best Total savings
Implant 1 units € 3,156 € 2,670 € 2,670 € 140,454
In patient days 6.9 bed days € 321 € 289 € 289 € 193,688
Theatre hours 1:30 hours € 970 € 900 € 900 € 109,772
Laboratory tests 20 tests € 13 € 15 € 13 € -
Radiology exams 2.5 exams € 102 € 76 € 76 € 19,074
Physiotherapy 4.7 sessions € 48 € 60 € 48 € 22,019
Other treatments 3 sessions € 18 € 30 € 18 € 5,058
€ 490,064
Cost per patient € 7,608 € 7,608 € 6,730
Savings % 10% 10% 20% !!!

10. Our new cost breakdown

11. Getting there:
Technology &
implementation

12. Cost breakdown of a DRG
Non-Hipe
Hipe

13. Technology: current data flow
Dashboard
Benchmark reports
Cost
Analysis model TTP Benchmark
database
The data is there.
Just connect it.
Performation is currently executing this successfully in Irish hospitals
Connect
and transform C&T C&T C&T C&T C&T C&T
Registration systems
HIPE Caredos PAS Lantis ….. Excel

14. Future data flow in hospital
Dashboard
Benchmark reports
Cost
Analysis model TTP Benchmark
database
Data ware house Structurally assure
management information
Data ware house
Connect
and transform C&T C&T C&T C&T C&T C&T
Registration systems
HIPE Caredos PAS Lantis ….. Excel

15. Management
Don’t wait for everything to be perfect
Take (financial) control at local level
Benchmarking is more than technology
Implementation is key
Top management commitment
Use benchmarking as base for budget allocations
Discussions & workshops with doctors
Build business cases based on benchmarks
The clinician has to do at least 50%
Speak the right language!

16. Summary
How can Irish hospitals benefit from benchmarking?
Get into financial control
Perform better despite budget restraints
And what is required to get there?
Costing of the full patient cycle
Use all production data sources (Hipe, theatre, pathology, radiology)
Technology should be sound: IT and cost model
Use the benchmark results in day to day management
Top management should carry the implementation
Is it possible today?
Yes, it is possible today in Ireland

17. Sweelincklaan 1 5 Fitzwilliam Square
3712 JA Bilthoven Dublin 2
The Netherlands Ireland
+31 30 233 3872 +353 1 662 8280
www.performation.com