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Virginia MGMA State Conference, Richmond, VA

Monday, March 21, 2016

10:45 AM – 12 Noon

1:15 – 2:30 pm

Michael O’Connell, MHA, FACMPE

Vice President, Clinical & Support Services

Cleveland Clinic, Marymount Hospital

30 Ideas on How to Save Money in

Your Medical Practice

Objectives

Explore 30 cost-saving ideas to consider for your medical practice

Describe how these ideas were investigated and vetted

Determine whether one of these ideas could benefit your practice in 2016

Our Current Reality

Care Affordability Consumerism

Cost, Quality, Value Transparency

Value Based Purchasing Increased Access

Quality & Efficiency Metrics

Accountable Care Organization

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Remain True to Our Cleveland Clinic Mission

Reaffirming our strategy to invent the future of healthcare, Dr.

Cosgrove said,

“We will act with courage in the face of this new reality.

I know that you have the courage to make the change to

assure quality and ready access at an affordable cost.

I believe in you and the future of Cleveland Clinic.”

CEO Toby Cosgrove, MD, 2015 State of the Clinic Address

Idea Program & Strategic Committees

Cleveland Clinic developed a “MyTwoCents Program” which invites employees (caregivers) to submit their ideas for consideration. Ideas can be to improve quality, safety, and/or access or ways to save money. Program resulted in 1,000 ideas and $7 million in savings.

Improving care affordability resulted in $498 million in cost savings for Cleveland Clinic in 2014-2015.

$53 M Hospitals

$169M Indirect/Administration

$268M Clinical

$8M Other

Cost Repositioning and Care Affordability Eight Teams with a Long-term, Enterprise-Wide Effort in which Every Clinical and Administrative Area Assesses Everything They Do to Provide Services More Effectively and Efficiently:

1. Clinical Program and Asset Optimization (Clinical programs, assets, and services to optimize locations and capacity)

2. Indirect Program and Asset Management (non-billable operational support, corporate shared services, administrative overhead)

3. Non-Staff Workforce and Productivity (Non-Physician Employees including hiring patterns, productivity, span of control, pay/benefit policies)

4. Staff Workforce and Productivity (Physician Recruitment, Practice, and Retention)

5. Stewardship (Managing System Resources, Discretionary Spend, Sustainability, Waste)

6. Education (Educational Services including GME, CME, and Health Sciences)

7. Research (Performance of basic, translational, and clinical research)

8. Value Based Care (Care Paths, Care Coordination, Contracting)

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30 Ideas

Energy Usage Sustainability Conduct RFPs to

Consolidate Services/Supplies

World Health Organization

Protocol Marking Computers

Medication Drug Costs

Recycling Surgery Cost Per

Case Work Week Printing

Employee Health Plan Incentives

Paper, Paper, Paper

Courier Services Cell Phone Use Computer Training

Desk Top Printers Clinical Service

Integration Inventory Control

Reprocessing Surgical Items

Pharmacy Expired Items

And Many More ….

Provide More

Electronic Options

Reduce Paper and Mailings No More Paper Checks

Purpose: Reduce unnecessary use of paper and mailings.

Initiatives: Stopped mailing W-2s to employees and employee open enrollment packets. All available on-line. Offer e-billing statements online. No employee paper checks.

Savings: $640,00 for one year of one type of mailing!

Wound Cleanser

Initiative: Standardized to

single wound cleanser product

from five products with extensive

cost variances for same outcome.

Cost Savings: $10,000

A Clinical Committee can

evaluate options.

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Double-Sided

Printing

Initiative: Default

printers to double-sided

printing

Cost Savings: 50%

reduction on paper costs

Comments: Buy-in from

Senior Leadership

Replace Sharpies

with Alternative

Initiative: Purchase alternative

marker for pre-operative

markings

Cost $3 per marker, alternative

product $1

$2 cost savings per surgery

Cost Savings: $20,000 annually

10,000 surgeries per year

Eliminate Exam

Room Phones

Initiative: Eliminated

phones from exam rooms

Shut off six phone lines in

one department

Cost Savings: $1,500

annually for one

department only.

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Decrease Overtime

Creation of Multiple Options OVERTIME REDUCTION

• Purpose: Create options

that prevent inappropriate

use of overtime.

• Initiatives: 36 Hour Work

Week, Creation of Float

Pool, Hiring PRNs, 15

Minute Creep Reduction

Drug Information

Resources

Initiative: Consolidate

online drug information

resources

Went from two sources to one

Cost Savings: $1 million

enterprise wide

In-house

Computer Training

Initiative: Provide in-house

computer training for desktop

applications

Eliminates outside vendor fees

Cost Savings: $200,000

annually.

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PACU Bedside Carts

Initiative: Reduce par levels

of supplies kept on clinical

carts.

700 items to 330 items

Cost Savings: $69,000

annually.

Or eliminate carts and

centralize supply inventory.

Alcohol Pads

Initiative: Change

vendors for alcohol pads by

leveraging vendor

proposals.

Cost Savings: $17,000

Bacitracin Waste

Initiative: Convert to unit dose

bacitracin packets

Originally using 28g tubes

Cost Savings: $8,000 annually

Decreases amount of wasted

product

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Courier Services

Initiative: Audit and

consolidate courier pick-up

locations and times.

Cost Savings: $35,000 in

courier charges.

Default E-Prescribing

in EMR

Reduce Paper Use Adapt to Technology Benefits

Purpose: Providers have the option to either e-prescribe or write their outpatient prescriptions for patients.

Initiative: Making e-prescribing the default option instead of paper printing as option, decreased paper accost associated with written prescriptions.

Savings: 1 Cent per Page

Create Multi-

Functional Devices

Initiative: Eliminate

individual desktop printers;

utilize a central printing

unit for departments for

printing, copying, and

faxing, and scanning.

Cost Savings: $5,000

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Lotion

Initiative: Reduce size of lotion

bottles given to patients, 20 oz. to

10oz.

Cost Savings: Dollars per unit.

Decreases amount of wasted product

Save Our Supplies

Initiative: Restock and

reuse supplies that are still

sealed instead of throwing

them away.

Cost Savings: $5,000 in

one month.

Drug Concentration

Standardization

Initiative: Standardize

bivalirudin concentration

5mg/ml to 1mg/ml

Reduces amount of

medication wasted.

Cost Savings: $200 per

drug dispensed

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Replace Foam

Cradle at ASC

Change Supply Use Comparable Product

Purpose: At Ambulatory Surgery

Center, anesthesia uses a foam

cradle for the patient’s arm at

$6.19 each.

Initiative: Work with vendor for

comparable product at $2.57 each.

Cost Savings: $1,042 annually at

one ASC based on surgery volume.

Employee

Health Costs

Initiative: Implement programs and incentives for healthy lifestyle choices

Tiered health plan

No smoking policy

Chronic care programs

Cost Savings: Reduced rate of employee health costs by 50%. 7.5% to 3.6%

Changed Use

of Sterile Gloves

Work with Vendors Sterile Gloves

Purpose: Use of one type of sterile glove in one department was $78 per box. Other options weren’t considered.

Initiative: Found comparable product at $20 per box.

Cost Savings: $5,000.

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Single Use Device

Reprocessing

Program Throughout

Cleveland Clinic

Scorecard for Results

Initiative: FDA Approved Process where we track monthly and look for at least 60% compliance with eligible products and use scorecard to track results

Cost Savings: $3,286,837 savings in 12 months and 95,101 pounds of waste diverted.

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Computer

Monitors

Initiative: Power off

computer monitors at night.

Cost Savings: $6,100

annually.

Audit

Telecommunication Lines

Initiative: Deactivate

telephone and fax lines no

longer in use

Cost Savings: Thousands

of dollars after first audit

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Develop a

Green Team

Reduce, Reuse, Recycle Cleveland Clinic Green Team

Initiative: Create a Green Team

to identify ways to reduce, reuse,

and recycle waste.

Cost Savings: One site has saved

over $15,000 annually by

eliminating use of one dumpster

weekly.

Pharmacy

Initiatives Avoidance

Initiative: Evaluate

formulary approvals based

on evidence based

medicine.

Cost Avoidance:

$750,000 from oncology

formulary decisions.

Medical Executive Committee

Pharmacy & Therapeutics Committee

Clinical Sub-Specialty Panels

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Evaluate On-call

Services & Technology

Initiative: Evaluate use of

pagers and on-call schedules

One department consolidated

to one on-call pager from

three.

Cost Savings: $8,500 annual

for one department (On-call pay

+ monthly pager fee).

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Eliminate

Desktop Printers

Purpose: Integrate

technology to central

Multi-Functional Devices.

Initiative: Removed desk

top printers in one location

and eliminated toner user

and maintenance costs.

Cost Savings: $12,000

Energy Savings

Energy Committee

Replace light bulbs

Decrease temperature settings

Turn off lights

•

Initiative: Reduce energy use by 20% by 2010

• Creation of an Energy Committee to identify opportunities

• Savings: $100,000 in projects for the 1st year in one location.

Rapid Sequence

Intubation Kits

Initiative: Remove RSI

kits and incorporate

needed medications into

code carts

Removed two medications

Cost Savings: $1,200

annually

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Purple Bags

Initiative: Evaluate alternative

waste operations

Utilize purple waste bags for

recyclable surgical items.

Cost Savings: $230,000

annually.

Reduce garbage bin fees.

Key Take Aways

Get Ready for the 2017 Budget!

Engage Your Caregivers and Professional Staff to Submit Ideas

Encourage a Culture of Innovation and Creativity

Encourage Everyone to Submit Ideas – the More the Better!

Explain to Idea Submitter the Reason Why Idea Was Not

Considered and Thank Person for Submitting Idea

Let Staff Know When A Cost Saving Idea Has Been

Implemented

Celebrate Ideas that Are Implemented!

Questions?

Michael O’Connell, MHA, FACMPE

Cleveland Clinic, Marymount Hospital

Telephone: 216-587-8087

Email: moconnel@ccf.org