SOURCE: VHA Inc.

November 11, 2010 09:00 ET

New VHA Inc. Door-to-Discharge Program Enables Hospitals to Save Millions

Improves Efficiency and Cost Equation for High-Cost Medical Procedures

IRVING, TX--(Marketwire - November 11, 2010) - VHA Inc., the national health care network, is launching its VHA Door-to-Discharge™ program to help hospitals trim millions of dollars from their high-cost cardiology, orthopedics and spine service line procedures. The new program will help health care organizations reduce their total case cost and strengthen their bottom line.

Recent industry research indicates that hospitals need to reduce their costs by more than $1,000 per case as health care transitions to a value-based purchasing model with lower reimbursements from both Medicare and commercial payers.

Door-to-Discharge takes a comprehensive, patient-centered approach focusing on clinical integration to improve utilization and streamline care delivery. Participating hospitals can decrease their utilization costs by as much as 30%, streamline patient flow by up to 40%, and reduce supply acquisition costs by up to 25%, yielding millions in cost savings in as few as 12 months. The program also will help hospitals lower re-admissions and decrease mortality, yielding additional savings while improving patient care.

Viewing each patient's case as a single episode of care, VHA's clinical experts are applying Lean Management and Six Sigma methodologies to collect and analyze information on all aspects of the patient's clinical condition and hospital stay. Examining the patient's encounter from entry point through discharge, the work uncovers opportunities to streamline processes, optimize productivity and improve patient care. (Please see Chart 1A.)

"The health care industry is moving toward a bundled payment model, at least for some portion of our reimbursement income, so it's vital that we learn to shrink our process times and all the costs associated with delivering care, not just the costs for the products we use," said Dr. Steven Packer, president and chief executive officer, Community Hospital of the Monterey Peninsula, in Monterey, Calif. "We look forward to using VHA's Door-to-Discharge program to identify opportunities for change in our delivery system for some of the highest-cost procedures so that both the organization and the patients benefit."

VHA's clinical and supply chain experts will target multiple areas including: supply acquisition costs and utilization, ancillary service utilization, patient throughput, operational productivity, clinical quality, documentation and coding and physician engagement. Using clinical metrics, hospitals will implement improvements to minimize physician and nurse practice variations, improve the use of existing capacity, reduce waste and drive down service line costs.

"Current financial pressures and future demands accompanying health care reform efforts will force hospitals to implement rapid and effective cost-reduction strategies that engage and align clinicians, physicians, administrators and staff," said Patricia Tyson, vice president of Performance Services for VHA. "By focusing on each step of the patient care process we can monitor the expense and revenue opportunities buried within each step and help hospitals improve their financial position by preserving money that would otherwise have fallen through the clinical cracks. At the same time, we're tackling issues like room turnover time, registration delays and infections, all of which impact patients directly."

According to VHA's advanced analytics and business intelligence analysis, Door-to-Discharge programs have the potential to yield multimillion dollar savings using VHA's Physician PreferenceLYNX™ national comparative database that links performance metrics on patient procedures, clinical conditions, physician practice, operational measurements, readmission, mortality and other factors. VHA's data analysis helps hospitals compare performance metrics to peers and best practices industry wide.

VHA is introducing the program while hospital financial losses are at an all-time high. The U.S. Congressional Budget Office reports that hospitals lost $5.1 billion from patient care delivery in 2009. But not all health systems are struggling. In fact, some VHA member hospitals are using the Door-to-Discharge program to proactively position their organizations for future growth, including Houston-based Memorial Hermann Healthcare System, Texas's largest not-for-profit health system.

"Health care providers have to think differently about health care delivery due to impending decreased reimbursements and pay-for-performance measures," says Dan Humphrey, systems executive, Supply Chain at Memorial Hermann Healthcare System.

"Memorial Hermann executives identified a $195 million target as the amount required to earn a profit margin at Medicare payment rates, an analysis that hospital executives nationwide are currently performing. With that kind of required cost reduction, hospitals will need to begin with quick wins, focusing improvement efforts in the most expensive care delivery areas and those areas that have a high percentage of Medicare patients, such as cardiology," Humphrey said.

Adds Joan Richards, chief executive officer of Crozer-Keystone Health System in Springfield, Pa.: "VHA's Door-to-Discharge program will help protect the long-term success of our organization by infusing effective and efficient supply chain and clinical practices into our care delivery system."

For more information, contact VHA or visit www.vha.com/DoortoDischarge.

About VHA -- VHA Inc., based in Irving, Texas, is a national network of not-for-profit health care organizations that work together to drive maximum savings in the supply chain arena, set new levels of clinical performance and identify and implement best practices to improve operational efficiency and clinical outcomes. In 2009, VHA delivered record savings and value of $1.47 billion to members. Formed in 1977, through its 16 regional offices, VHA serves more than 1,400 hospitals and more than 28,000+ non-acute care providers nationwide. VHA is listed on Best Places to Work 2010 by Modern Healthcare and Computer World.

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