Within integrated delivery networks, connectivity is essential. This involves data, or electronic connectivity, which is mostly achieved today through electronic health records. It also includes, although often not thought about, physical connectivity, or transporting tangible materials throughout the system to provide care effectively.
EHRs have been keystone projects for IDNs today, but physical connectivity — or healthcare transportation strategies — have been less so. As health systems continue to shift toward a new delivery system and find ways to cut costs, healthcare transportation could address both issues.
In a webinar on Nov. 13 hosted by Becker's Hospital Review, three presenters — Mark Dixon, president of The Mark Dixon Group, Jake Crampton, CEO of MedSpeed, and Steve Statz, senior vice president of business development at Avera Health in Sioux Falls, S.D. — gave a background of the operating challenges health systems face and described how a healthcare transportation strategy can better align systems and drive value along the way.
A C-suite view of today's healthcare reform challenges
Since 1978, Mr. Dixon has been deeply entrenched within the Midwestern healthcare system. After starting as an assistant director of pharmacy at Region's Hospital in St. Paul, Minn., he worked his way up to CEO of Abbott Northwestern Hospital in Minneapolis. He also served as COO and CEO of Community Health Network in Indianapolis and South Region president of Fairview Health Services in Minneapolis.
In the webinar, he explained that healthcare reform is finally here to stay. "I've been in field for 25-plus years, and it's always seemed like we've been in the midst of change," Mr. Dixon said. "But it's really accelerated over the past few years."
Reform is coming in the form of four main areas: moving from a volume-based to value-based system, changing the care delivery model to create value, hospital/physician consolidation and cost containment. If hospitals want to survive in the new model of healthcare, they have to start making money on Medicare reimbursement (which is declining by $250 billion over the next six years for hospitals), and they have to reduce operating costs by 15 to 20 percent, Mr. Dixon said.
The power of integrated healthcare transportation
These demands require an entirely different viewpoint and business model, Mr. Crampton of MedSpeed said. Hospital and health system leaders are taking a close look inside of their business models and are seeing new opportunities, one of which is to systematically organize and move physical materials and supplies throughout their organizations, Mr. Crampton added.
As hospitals and health systems expand their geographic footprint and recreate the continuum of care to reach patients closer to home, there is a growing need to integrate operations. This is broadly true and certainly so from a transportation standpoint, as hospitals, clinics, labs and other components of health systems have to deliver various materials from each other every day. According to Mr. Crampton, physical integration through healthcare transportation can:
• Enable centralization.
• Deliver meaningful savings from error reductions and resource re-allocation.
• Enhance the sharing of products and equipment systemwide, thereby reducing inventory needs.
• Provide the certainty that clinicians have the critical items they need when they need them to provide patients with the best care.
So what does smart healthcare transportation need to have? There are three essentials, Mr. Crampton said. First, there must be a high quality level of service. "When you have anything short of high reliability, waste enters the picture," he said.
Second, there must be the right levels of service. Healthcare is burdened with overutilization in both resources and care, in some respects, and appropriately distributing materials through the right channels at the right time will make a health system more efficient, Mr. Crampton said.
Finally, there must be a clear, easy-to-understand centralized system. This clarity enables systems to better leverage their transportation network in order to better streamline other functions.
Case study at Avera Health
The tangibility of a smart healthcare transportation strategy can best be seen in a case study. Mr. Statz of Avera explained how his health system and MedSpeed have been working together.
Avera is a 33-hospital system spanning several states. It also has more than 200 clinics, more than 40 nursing facilities and several other points of care. Because Avera mostly operates in rural areas of South Dakota, Iowa, Nebraska, Minnesota and other states, the system faced some unique challenges.
During the process of planning for a patient care initiative involving bedside medication verification, leadership quickly realized they weren't in the position to enable the initiative due to a lack of infrastructure, or physical connection. Additionally, they weren't effectively sharing materials systemwide and had minimal systemwide visibility.
A close look determined their healthcare transportation operations had become a growing cost burden. "It was not uncommon for our drivers to drive 300-plus miles in a day," Mr. Statz said.
In March 2012, Avera formed committees to evaluate how to better integrate and improve its transportation operations. Since going live with MedSpeed this past June, Avera has launched a new transportation initiative focused on lab specimens, pharmacy, marketing materials and medical supplies in the lowest unit of measure — and from a centralized system. Mr. Statz said Avera has been able to move more materials, increased integration, reduced inventory redundancy and added routes to more rural areas. Avera has already seen savings driven by their improved transportation network.
Mr. Statz said the health system expects more positive results as it adds blood, linens, financial documents and other supplies into its new transportation system. "Those are all incredible opportunities for us because what we have right now is we have the pipeline," Mr. Statz said. "The pipe is in place."
He emphasized that other health systems looking to improve their integration strategies, especially from a transportation point of view, have to find the right experienced partner. "We don't look at this as a service we're purchasing. We look at it as a true partnership," Mr. Statz said. "That's how we felt as we went into decision making process."
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