The path to greater OR efficiency — 5 Qs with Qventus CEO Mudit Garg

Amid pervasive staff shortages, many hospitals around the nation have been forced to temporarily shutter operating rooms, which are a crucial revenue driver for health systems.

This arguably couldn't be happening at more inopportune time — hospitals have lost billions of dollars in the last two years due to the pandemic and related factors. Earlier this year, the American Hospital Association estimated that more than 33 percent of hospitals are operating on negative margins.

Becker's Hospital Review recently spoke with Mudit Garg, the cofounder and CEO of the leading healthcare automation technology company Qventus, about these trends and how empowering staff with the right technology can generate greater efficiency in the OR.

Note: Responses edited for length and clarity.

Question: Why is growing surgical services revenue a top priority for health systems today? What strategies are health systems using to drive end-to-end growth?

Mudit Garg: The operating room is a crucial financial engine for hospitals. This has always been the case, but what we've seen over the past few years has put an overwhelming amount of pressure on OR departments and eroded performance — COVID, staffing shortages and rising labor costs. Because of this and other operational challenges, hospitals today are operating at historically low margins.

Qventus recently conducted a survey with The Health Management Academy. Seventy-six percent of healthcare executives surveyed said growing surgical services is the top priority for them. What's holding health systems back?

The strategy of improving the financial engine and the execution of it have always been disconnected. While the OR is the financial engine, it's held together by duct tape and fax. One of our customers said their surgical scheduling office had 2,300 inbound calls each month for just 1 hospital. Why are we relying on manual processes and tools involved in managing ORs?

The OR is an expensive asset. However, even when looking at OR primetime it is often 30 percent unutilized despite surgeons and patients not finding access quickly enough. When there is available time, it's not strategically used. The whole process to find time is nonstrategic and manual. It's like being back in the 1990's when you had to call a travel agent or airline to find flights one at a time. Oftentimes there are specific constraints and preferences that are not even considered.

More importantly, surgical robots, which are a strategic asset for hospital OR departments, are even more poorly utilized. For example, 30 to 50 percent of robotic room times are used for nonrobotic cases, which prevents high margin surgeries from being prioritized on the schedule.

Lastly, surgeons and ORs have significant untapped referral bases. There's poor visibility into referral patterns, so the cases that health systems want to recruit never make it into the OR. These new challenges demand a new approach. About five years ago, many first-generation products became available and tried to solve these challenges by providing visibility into OR schedules and improving block management — but they don't have the level of personalization, probabilistic machine learning, and automation that hospitals need today. You see those types of technologies across all aspects of your life now. For example, you used to see a chronological list of movies, and now Netflix provides personalized recommendations based on what you like to watch. You used to have to call airlines and travel agents to find flights, but now you can easily search for, and book, flights based on your preferences, right at your fingertips.

Automation is key: 95 percent of health system executives say they want more automation for their ORs and want to rely less on manual processes.

Q: What's different about automation software compared to typical OR scheduling software or EHR tools?

There's an abundance of software available that helps with OR scheduling and visibility. The problem is these rarely address the full scope of strategies that OR leaders need to maximize their resources and stay competitive.

A solution may address one limited problem — for example, providing visibility into OR schedules and performance — but does nothing to help the department to maximize white space, or find opportunities for growth. What's more, a solution may even create more work for teams — such as requiring schedulers to manually transfer information from one screen in the EHR to another — instead of automatically completing tasks to reduce workload.

These original OR solutions were useful five years ago, but health systems today need a new approach that helps them drive growth. As described above, these systems lack the probabilistic machine learning and personalization that is key.

As many health system leaders evaluate new strategies for managing their ORs, many are first looking at what they can do with their EHRs, which is the right question to be asking. But inevitably we hear a few things from those who have started down this path:

First, leaders acknowledge that EHRs are great systems of record but simply weren't designed to automate OR processes and drive growth. Next, they realize that they can't afford to wait for the EHR to introduce new capabilities. Every month of waiting puts the hospital further into financial peril and at a disadvantage relative to their peers. Lastly, it's critical for this to not just provide basic workflow efficiency but to integrate true intelligence and personalization.

To make this possible, we use a unique combination of AI-based automation, behavioral science, and comprehensive data. This is important because without the automation, OR schedulers can become overwhelmed. They need to field a barrage of calls, manually transcribe faxes and blindly search for cases to fill white space. Without behavioral science, you can't align surgeon incentives. And without comprehensive data beyond the EHR, you have no visibility into activity in your market and the relationships you need to build.

It's like driving a Tesla: we're ingesting data in real time and automating the routine tasks, but you're still in control.

Q: Tell me about the latest innovations within Qventus. How do these new capabilities benefit OR teams and surgeons?

We're intensely focused on helping health systems and surgeons get to peak OR efficiency so they can thrive in a challenging environment. Our perioperative solution is designed to drive end-to-end growth, and the core modules of our solution do several things: optimize access by creating white space and robotic capacity; fill open time with strategic cases to drive revenue growth; and provide visibility into OR and surgeon performance.

Now, the new enhancements we've introduced help OR departments get to an entirely new level of efficiency.

Let me share a couple of examples:

Scheduling accuracy is a massive challenge that results in a significant amount of unused OR time. Cases are often scheduled for longer than they actually take, so this blocks other surgeons from getting more OR time. EHRs and other software have attempted to solve this by developing models that predict case length based on the average of a surgeon’s last few cases. But there are so many other contextual factors that impact case length. Our machine learning model incorporates numerous other factors and handily beats performance seen from others making sure that the case is scheduled right the first-time versus having to fix it after the fact.

Another innovation I'm very excited about is our new data sources beyond EHR data. We know that health systems grow when their newer growth minded surgeons are enabled to grow. Most health systems have a comprehensive picture of what happens within their organization but that is limited to truly drive surgical growth without knowing what's happening in their market, let alone drive the change you need. By incorporating market data beyond the EHR, we can enable organizations to detect at-risk referral relationships, surface opportunities for "splitter" volume consolidation, and identify surgeons to target for market development efforts so that the capacity we create through our product can also be used to grow market share.

We've also enhanced the ability for clinic schedulers to view and request OR time. We have further advanced what's possible through personalization. Schedulers can search for OR time for multiple surgeons at once; and they can get even more personalized search results based on their surgeon's preferred surgery dates and times. It's a seamless experience similar to booking a flight on Kayak or Expedia.

Q: What results are health systems achieving? 

What's exciting is that our health systems are not only achieving impressive results — they're getting those results quickly and they're sustaining them despite continued industry challenges. We are seeing consistent releases of blocked OR time significantly in advance. 100s of hours of OR time released per month which at a time of limited staff and expensive cost to run an OR is amazing.

Then our software proactively learns and reaches out to surgeon offices to drive growth driving almost 60 percent utilization of that freed time. That drives over two additional cases per room per month, which translates to 20 to 70 cases per month in total for each of the health system partners we work with (depending on the number of ORs) and equates to nearly $15 million in additional revenue from case growth for a single facility.

What’s more, our health system partners are achieving these results despite staffing challenges. One of our partners grew case volume 7 percent over budgeted target volumes even though they had to close 20 percent of their ORs.

Our partners are also getting better utilization from their surgical robots. They have grown robotic cases by 33 percent and seen a 13 percent decrease in nonrobotic cases that get scheduled in robotic rooms. It’s a game changer not only for hospital margins but also for surgeons.

Q: How does pursuing this work give health systems a strategic advantage now, and how will it benefit them long-term?

In any industry, major technology advancements change the playing field and redefine the winners and losers in any market. This is no different in healthcare, and we're seeing this play out in major markets across the country.

Automation technology is a clear example where there is a compelling first-mover advantage. For example, when it's easiest for a surgical clinic scheduler to find and request time in one health system's ORs, they'll naturally prioritize that health system when they need to find time for their surgeons.

When you can automatically target the highest priority cases to fill OR time, you'll boost your revenue and margins per case, strengthening your bottom line. And when you have insights into referral patterns in your service that no one else has, you can proactively prevent leakage and work with your surgeons to target outreach efforts. It creates a far more aligned strategy with surgeons, so you'll attract the best in your market.

It's a lost opportunity once another health system in your market brings this technology to their ORs — they'll get to set the new standard of efficiency in your market and be first to take advantage of growth. And then you’ll be forced to catch up.

But more importantly, this translates to better surgical care for patients in your area. Patients will be able to get on the surgical scheduler sooner, which is better for outcomes. And by improving revenue and margins, it reduces the upward spiral of costs that ultimately goes back to patients.

The bottom line for every hospital leader is that it's a question of when, not if, to embrace automation technology for your ORs. Now is the opportunity to reimagine what surgical access looks like, and we’re seeing rapid acceleration of hospitals across the country embracing this approach.

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