In our last post, we explored the first of four key questions in an integrated performance management approach, ‘How am I performing?’ As discussed, answering that question is critical to constructing a clear view of current performance and then creating meaningful goals which will lead to action and performance improvement initiatives.
Now, how do you uncover areas needing improvement? Are you able to pinpoint and prioritize the most relevant and actionable opportunities? A rigorous, comparative performance evaluation can be very helpful in identifying opportunities for operational and clinical improvement, and give you the ability to see variance relative to tailored peer groups. The foundation of any benchmarking analysis is the accuracy and comparability of the data. Without that foundation, there will be no confidence in the results of the analysis and it becomes impossible to make important decisions necessary to impact change.
In order to ensure accuracy and comparability, your operational and clinical data must be treated and mapped the same way as everyone else in the database. If the data is self-reported, like most in the industry, it is difficult to be confident that others have treated costs in the same manner. At iVantage we map the data – in close collaboration with clients -- to strict definitions to be absolutely certain there is comparability across the database. Once that process is complete, clients can look for performance opportunities with confidence.
At OSF HealthCare, the approach they used to identify opportunities – and the one used with all iVantage’s clients – starts at the most detailed level of comparative analysis and aggregates the differences between a system or a facility, and its internal and external peers. With Surgical Services, for example, our clients can compare their overall cost performance based on unit cost comparisons to a tailored peer group – and then drill down to see how surgical costs compare against peers for DRGs driving the variation, understand the comparative cost subcomponents, lengths of stay, case counts, and ICD-10 procedure code variation. From there, users can drill down into internal physician and procedure code variation.
Further, users can look at service-line performance across the enterprise and identify variations to external peer groups, and then drill down seamlessly from the system to the facility, to the service line, to the DRG, to the subcomponent, to the physician, to the procedure code, and to the patient-level detail to get similar insight into drivers of variation that may be embedded in both clinical and operational processes.
When working to identify opportunities, keep in mind the following:
- Bigger is not better; better is better: Don’t get fooled into thinking larger databases equate to better, more accurate comparisons. Rigorous data mapping that happens collaboratively between you and your benchmarking partner ensures accuracy and true apples-to-apples comparisons. Also, peer groups should be transparent and tailored for each facility, working with facility leadership based on factors such size, volumes, IP/OP ratios, and specific services.
- It’s critical to have the ability to seamlessly navigate between clinical and operational data and insights. This helps managers understand the inter-connectedness of clinical and operation drivers of overall cost performance. In fact, you should have access to data on performance at the operating unit level, as well as service line, DRG, physician and case-level, with the ability to do cross-walks and detailed drill-downs to surface improvement opportunities.
- Treatment of corporate, shared services and outsourced costs should be consistent and distinguish between facility, regional and corporate cost opportunities. This helps ensure minimal false positives for cost or FTE excess. Remember, determining variance in areas where there is cross-charging or cross-function labor (e.g. imaging) is really where a rigorous approach to data mapping comes into play.
Once opportunities have been identified, where do you go to generate ideas, identify best practices, and apply the lessons learned by hospital leaders who have seen similar challenges? How you can collaborate with peers and write your own blueprint will be the focal point of our next post.