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Hospitals across the country are aggressively pursuing cost-cutting strategies, and the high-value, high-cost environment of the operating room is a prime target for cost reduction. Applying variability methodology swings the pendulum for access to the hospital’s operating rooms from “whatever and whenever” the surgeon wants, to what is best for the hospital. Put more directly, in this model, the surgeon is asked to compromise to meet the hospital’s financial needs. The resultant tension between a surgeon and hospital administration can become intense and was certainly present during the redesign and implementation detailed in this case study. Software and information technology tools to help schedule surgical cases within the redesign goals, and reporting tools within a quantitative dashboard are essential to facilitate adoption of this program. Transparency regarding leadership decisions and frequent feedback to all providers about performance improvements should be emphasized. Change management and analytics support should be identified either internally or pursued externally before starting such a program.
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Re-engineering the Operating Room Using Variability Methodology to Improve
Healthcare Value
C. Daniel Smith, MD
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Healthcare Delivery Goals
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To provide the right care
To the right patient
At the right time
In the right place
VARIABILITY IS THE ENEMY
*Outcomes, Safety, Service
Variability in Operating Rooms
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• Peaks and valleys in day-to-day volume of surgical cases
• “No one wants to operate on Monday or Friday”
Day-to-Day
• On the day of surgery, changes to the OR schedule and resource allocation
• Emergencies, add-ons, delays, etc.
Within-Day
Day-to-Day Variability
StaffingHospital censusSupply chain…..
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Within-Day Variability
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Within-Day Variability
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Within-Day Variability
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m C
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esElective Rooms on Day of Surgery
2009-2010
SafetyPatient satisfactionTeamwork….
Variability Theory in Surgery
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Natural Variability•a result of naturally occurring processes•uncontrollable
Artificial Variability•a function of man made decisions•controllable
• Emergency or unscheduled Operations
• Uneven scheduling of elective cases
Within 48 hours
Urgent / Emergent (3)
Elective (16)Scheduled
Natural Variability
Artificial Variability
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Case Study Setting
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Mayo Clinic Florida
• 214 bed hospital (21 ORs, 28 ICUs) and outpatient practice within a single complex/campus – opened in 2008
• 11,900 admissions/ year: 55% surgical
• 12,000 operations/year – complex case mix (e.g., 150 liver transplants, 1,200 NS, 900 GISurg)
• 443,500 outpatient visits annually
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• Prime time OR utilization <65%
• 15 FTEs of overtime every pay period
• Low surgeon and staff satisfaction with OR management and efficiencies
• Concern about absence of specialty specific teams
• Frequent disruptions of elective cases by transplants and urgent cases
Baseline Data 2009
Proposal / Hypothesis
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Applying variability theory and methodology, we could
expand the capacity of our hospital’s operating rooms
and increase surgical throughput without adding
infrastructure or expense.
Goals for Variability Management Program
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Within 48 hours
Urgent / Emergent (3)
Elective (16)Scheduled
Natural Variability
Artificial Variability
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• 3 month prospective data collection
• Rooms reallocated based on real volumes/utilization
• Staff allocated to services (added 15 FTEs)
• Implemented November 1, 2010
• Impact assessed at one year
Operating Room Redesign
Results
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Pre- MVP Post-MVP % ChangeSurgical Cases 11,874 12,367 4%Surgical Minutes 1,757,008 1,844,479 5%OR Utilization (19 Room Model) 61% 64% 5%Number of Overtime FTE's (average) 7.4 5.4 -27%Staff Turnover (highest to most recent) 20.3% 11.5% -43%Daily Case Volume Variation 55.24 44.06 -20%Daily Surgery Minutes Variation 6,531 5,124 -22%Elective Room Changes (Average/Mon) 80 25 -69%Elective Room Changes (%) 8% 2% -70%
Salary Dollars (Adjusted for Salary Increases) Total $12,607,061 $13,395,997 6% Monthly $1,045,942 $1,115,646 7%
Cost/Case $1,062 $1,070 0%Cost/Minute of Surgery $7.18 $7.26 1%
Staff Turnover Cost (millions) $2.47 $1.47 -41%Overtime Cost Savings $111,488
Total OR Net Revenue (Fee increase adjusted) $93,929,569 $98,686,693 5%
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Pre- MVP Post-MVP % ChangeSurgical Cases 11,874 12,367 4%Surgical Minutes 1,757,008 1,844,479 5%OR Utilization (19 Room Model) 61% 64% 5%Number of Overtime FTE's (average) 7.4 5.4 -27%Staff Turnover (highest to most recent) 20.3% 11.5% -43%Daily Case Volume Variation 55.24 44.06 -20%Daily Surgery Minutes Variation 6,531 5,124 -22%Elective Room Changes (Average/Mon) 80 25 -69%Elective Room Changes (%) 8% 2% -70%
Salary Dollars (Adjusted for Salary Increases) Total $12,607,061 $13,395,997 6% Monthly $1,045,942 $1,115,646 7%
Cost/Case $1,062 $1,070 0%Cost/Minute of Surgery $7.18 $7.26 1%
Staff Turnover Cost (millions) $2.47 $1.47 -41%Overtime Cost Savings $111,488
Total OR Net Revenue (Fee increase adjusted) $93,929,569 $98,686,693 5%
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Pre- MVP Post-MVP % ChangeSurgical Cases 11,874 12,367 4%Surgical Minutes 1,757,008 1,844,479 5%OR Utilization (19 Room Model) 61% 64% 5%Number of Overtime FTE's (average) 7.4 5.4 -27%Staff Turnover (highest to most recent) 20.3% 11.5% -43%Daily Case Volume Variation 55.24 44.06 -20%Daily Surgery Minutes Variation 6,531 5,124 -22%Elective Room Changes (Average/Mon) 80 25 -69%Elective Room Changes (%) 8% 2% -70%
Salary Dollars (Adjusted for Salary Increases) Total $12,607,061 $13,395,997 6% Monthly $1,045,942 $1,115,646 7%
Cost/Case $1,062 $1,070 0%Cost/Minute of Surgery $7.18 $7.26 1%
Staff Turnover Cost (millions) $2.47 $1.47 -41%Overtime Cost Savings $111,488
Total OR Net Revenue (Fee increase adjusted) $93,929,569 $98,686,693 5%
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Pre- MVP Post-MVP % ChangeSurgical Cases 11,874 12,367 4%Surgical Minutes 1,757,008 1,844,479 5%OR Utilization (19 Room Model) 61% 64% 5%Number of Overtime FTE's (average) 7.4 5.4 -27%Staff Turnover (highest to most recent) 20.3% 11.5% -43%Daily Case Volume Variation 55.24 44.06 -20%Daily Surgery Minutes Variation 6,531 5,124 -22%Elective Room Changes (Average/Mon) 80 25 -69%Elective Room Changes (%) 8% 2% -70%
Salary Dollars (Adjusted for Salary Increases) Total $12,607,061 $13,395,997 6% Monthly $1,045,942 $1,115,646 7%
Cost/Case $1,062 $1,070 0%Cost/Minute of Surgery $7.18 $7.26 1%
Staff Turnover Cost (millions) $2.47 $1.47 -41%Overtime Cost Savings $111,488
Total OR Net Revenue (Fee increase adjusted) $93,929,569 $98,686,693 5%
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Pre- MVP Post-MVP % ChangeSurgical Cases 11,874 12,367 4%Surgical Minutes 1,757,008 1,844,479 5%OR Utilization (19 Room Model) 61% 64% 5%Number of Overtime FTE's (average) 7.4 5.4 -27%Staff Turnover (highest to most recent) 20.3% 11.5% -43%Daily Case Volume Variation 55.24 44.06 -20%Daily Surgery Minutes Variation 6,531 5,124 -22%Elective Room Changes (Average/Mon) 80 25 -69%Elective Room Changes (%) 8% 2% -70%
Salary Dollars (Adjusted for Salary Increases) Total $12,607,061 $13,395,997 6% Monthly $1,045,942 $1,115,646 7%
Cost/Case $1,062 $1,070 0%Cost/Minute of Surgery $7.18 $7.26 1%
Staff Turnover Cost (millions) $2.47 $1.47 -41%Overtime Cost Savings $111,488
Total OR Net Revenue (Fee increase adjusted) $93,929,569 $98,686,693 5%
OR Redesign - Summary
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• Increased volume of surgery
• Added 15 FTEs without significant increase in cost/case
• Prime-time utilization increased and overtime decreased
• The overall surgical schedule became more predictable and reliable
• Staff satisfaction improved as evidenced by decreased staff turnover
• Increased volume without added cost & cost avoidance resulted in improved financial performance
OR Redesign - Conclusion
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• Major cultural and operational change to operating room management
• Re-design around managing variability worth pursuing
• The increased capacity without increased operational costs may be important adjunct to tactics to deal with expected payment reductions accompanying healthcare reform
Re-engineering the Operating Room Using Variability Methodology to Improve
Healthcare Value
C. Daniel Smith, MD
Southern Surgical Association124th Annual Session
December 3, 2012The Breakers
Palm Beach, Florida
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