Could Your OR Save $1M This Year?

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At the Becker's Annual CEO Strategy Roundtable, held Nov. 14 in Chicago, Jeff Peters, president and CEO of Surgical Directions shared his thoughts on hospitals growing perioperative services.

"Perioperative services are the driver of any health system or hospital, at 65 percent of a hospital margin. If you're not successful in perioperative services, you're not going to be successful as a healthcare organization," said Mr. Peters.

According to Mr. Peters, the average hospital has the potential to improve performance between $500,000 and $1 million per operating room. The cost savings come from better utilization of ORs, which are used, on average, only 55 percent of the time. Mr. Peters suggested better governance of ORs and better allocation of block times as significant opportunities to improve performance.

Collaborative OR leadership has the potential to optimize operations, said Mr. Peters. It is necessary to engage all interested parties: surgeons, anesthesiologists, nurses and hospital leadership. This collaborative monitoring allows each party to express its concerns with any OR practices, improving efficiency and profitability.

Blocking eight hours rather than four hours in the OR is a great way to incentivize surgeons to bring cases, according to Mr. Peters. He said not one of the 500 hospitals employing Surgical Directions' services has lost cases after making the switch in blocking.

Within the OR, another important focus should be supply costs. While most ORs focus on labor costs, Mr. Peters said better supply chain management represents a $200,000 to $300,000 cost-savings opportunity per OR per year. These savings exist in stocking the correct amount of inventory, implementing preference cards, tracking implant costs and making better use of reprocessing opportunities.

From a personnel management perspective, to help surgeons assist the ORs in improving performance, Mr. Peters suggested insisting on early surgeon presence in the OR, as well as data sharing among surgeons. Surgeon presence is the number one driver of OR efficiency, so asking surgeons to stick to an on-time schedule is a must.

Data-sharing — or providing each surgeon with data about his or her time management, revenue and costs as compared to the OR average or to the other surgeons in the practice as a way of encouraging benchmarking — is another way to performance in the OR, Mr. Peters said.

Finally, Mr. Peters suggested implementing a daily huddle to discuss patients three days out. While these huddles take approximately one hour per day, it helps optimize use of OR resources and patient order. During huddles, stakeholders should discuss everything that could go wrong and address patient comorbidities to prevent readmissions related to preventable complications associated with poor comorbidity management during surgery and after discharge.

Finally, Mr. Peters recommended tracking all of this data for quality and performance purposes and for executive leadership support. "Perioperative growth only works by keeping quality and outcomes in mind. It can't work based completely on financial considerations," he said.

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