What Works

Building market share and physician loyalty through information management

by Monte Wilson and Sue Tarkka

The increased competition between hospital operating rooms and ambulatory surgery centers (ASCs) combined with the higher reimbursement rates earned in the ambulatory setting has resulted in a loss of surgical services business in inpatient settings. 

Such was the case for St. Edward Mercy Medical Center in Fort Smith, AR. Surgeons affiliated with the 343-bed regional community hospital began taking their business to free-standing ASCs. To earn surgeons’ loyalty and recover regional market share for surgical services, St. Edward Mercy successfully created a joint venture ambulatory surgery center with a unique value-add: implementation of the unified clinical and inventory management information solutions already proven to create efficiency and productivity advancements in the organization’s main operating room. In partnership with Kansas City-based Cerner Corp., St. Edward Mercy extended Cerner’s ProCure materials management solution and SurgiNet surgery and anesthesia information management solution to create a seamlessly functioning workflow process that united the clinical and managerial facets of the surgical services business. 

Unified clinical and department management solutions created operational efficiencies for both the main OR and the ASC, enabled St. Edward Mercy to standardize the inventory, realize significant supply cost reductions, and implement a par level inventory management model. The information technology strategy also enabled surgery leadership to increase the operational contributions and value of the department effectively competing to win back surgeons’ business.

The Cerner information technology solutions enable the surgery department to pursue a business analysis model focused on measuring, reporting, studying and improving standard practices. The financial data used to analyze and optimize supply usage is generated from clinical documentation captured in the surgical patient’s electronic medical record. This direct connection of clinical and financial data increases surgeons’ confidence in the credibility of data the department provides. Data accuracy is validated by the documentation of supply items used during the surgical case itself. Validating supply costs with clinical data facilitates surgeons’ acceptance of new business imperatives, such as standardizing the surgical practice, designed to increase efficiency while maximizing clinical effectiveness.

For example, St. Edward Mercy compared laparascopic cholecystectomy costs, initially delivering reports that did not reveal surgeons’ names. The reports showed that monthly supply costs and case times varied significantly, while resulting outcomes did not. Department leadership was able to objectively demonstrate that, without a compelling clinical reason indicating otherwise, product standardization for these procedures was the clear best practice from a business perspective. Decisions such as this have resulted in thousands of dollars saved since unifying and automating the surgery and supply chain processes, including a savings of $60,000 to $70,000 in the second quarter of 2003 alone.

Inventory counts are automatically decremented based on the surgical case documentation in the electronic medical record. Because of this, St. Edward Mercy reduced manual steps once required for counting inventory. The physical inventory count that used to require three business days on a biannual basis now takes just one business day, and can be conducted as needed. Online tools enable immediate inventory counts, with personnel able to collect and review data in a matter of minutes, without ever leaving their desks. The end-of-month verification audits have proven highly accurate.

The combined information management solution has yielded diverse additional benefits. The standardization process has resulted in a reduction of preference cards used in both the main OR and the ASC, presenting productivity enhancements for personnel responsible for setting up case carts for scheduled surgical procedures. Delivery of assembled case carts to the OR and ASC the night before morning procedures has improved case turnover time, now at 10 to 15 minutes in the ASC, as compared to the national average of 30 minutes. The streamlined process has enabled the reduction of an FTE formerly dedicated to this process. The opportunity to study supply use over time has saved thousands of dollars in overhead by eliminating supplies that have a history of waste or non-use. These items can be returned to suppliers for credit or sold to hospitals that can use them. Reporting mechanisms automatically flag items nearing expiration, identifying them right down to the shelf and drawer level, helping optimize utilization of items in a timely fashion, or, when necessary, facilitating the removal of expired items from circulation. The ability to separate information on costs for the main OR and the joint venture ASC, whose surgeons are financial stakeholders, has proven important in keeping the facilities’ business and financial data independent of one another.

At the bottom line, the unified, automated surgery and supply chain process results in shorter patient wait times, increased clinician productivity, increased cost efficiencies and charge-capture accuracies. This translates into improved throughput in the operating room, the outcome of an increasingly optimized OR schedule. The three years of IT-driven surgical and supply chain processes have shown a steady increase in the volume of perioperative procedures. This has improved the revenue stream for both St. Edward Mercy and the surgeons involved in the joint-venture ASC.

St. Edward Mercy Medical Center continues to leverage Cerner solutions to support standardization efforts, increase its automation and throughput in the perioperative space, and effectively manage the business aspects of the service. The success of the endeavor stems from the mission to optimize the financial health of the organization maintaining or improving the quality of patient care.

HPN

Monte Wilson is vice president for cardiology and surgical operations at St. Edward Mercy Medical Center, Fort Smith, AR.

Sue Tarkka is marketing manager, SurgiNet, surgery and anesthesia solutions, for Cerner Corporation.

October 2003