Clinical Engagement.
Balancing Corporate and Clinical Governance
A/Prof Val Usatoff MBBS(Hons), MHSM, FRACS, FACHSM
Deputy...
Disclosures
• Salaried employee of Cabrini Health
• Salaried employee of Bayside Health
• Salaried employee of Western Hea...
About Cabrini Health
• Not for profit private health group
• 2 acute hospitals – 500 and 100 beds
• 20 operating theatres
...
Assoc. Prof Val Usatoff
Deputy Medical Director, Cabrini Hospital
• Practicing General and HPB Surgeon
• Cabrini Hospital,...
Setting the scene
• Patients and families are the focus of our care
• But:
• Clinicians bring the elective procedural work...
Traditional idea of autonomy is changing
Clinician
Autonomy
Clinical
Governance
Regulatory
Compliance
National
Standards
C...
Changing the paradigm
Doctor as
customer
The
compliant
doctor
Engaged
doctor as
partner
Engaging Doctors in the
Health Care Revolution
• Doctors are deeply anxious and angry about
transformation, fearing loss o...
How can doctors be engaged?
• Align goals of individuals and organisation
• Demonstrate that you are running a business
• ...
Characteristics of effective engagement
• Two surveys by the Department of Health and
Healthcare Financial Management Asso...
The top three barriers
– according to Clinicians
• Lack of basic financial
awareness/skills among
clinicians
• Lack of rob...
The top three barriers
– according to Finance Managers
• Variability of cost and
income data
• Lack of robust cost data
• ...
Both groups agreed –
good engagement requires…
• Availability of good data
• Clinical
• Financial
• Clinical champions AND...
• Identification of clinical champions
• Early education of process
• Standardisation of process, - “hassle free”
• Commun...
Why does engagement matter?
• Business viability
• Safety
• Quality
• Willingness to adopt and accept change
• Better comm...
Medical staff engagement.
The risks of getting it wrong.
Poor Engagement + Underutilised
Capital
“Why did you
listen to hi...
Organisational commitment to engagement
Rational and emotional engagement.
Both required to drive performance
..increased willingness to go
above and beyond the n...
Myths surrounding the business.
• “But we are concerned with clinical outcomes”
• “Aren’t you not for profit?”
• “Aren’t y...
Demonstrate you are running a business
• Talk about it
• Write about it
• Show them the financial reports
• Tell them your...
…just means that we spend
money thoughtfully and
mindfully.
Clinical Costings – Providing information
at Specialty and Individual level
• A single specialty, procedural financial dat...
Incentives – do they work?
• Yes!
• What’s in it for me?
• Tickets, dinners, trips – short term, trivial
• Financial shari...
Pricing Awareness?
• 503 respondents
• Survey finds few orthopedic surgeons know the costs
of the devices they implant.
• ...
Doctors know the trends
• Reluctant to change some practices.
• Often eager to adopt new (?sexy) innovations
• But beware ...
Survey of US Physicians - 2013
• 6/10 say doctors have the greatest influence on
medical technology purchasing decisions.
...
Common Supply Pitfalls
• Underinvestment in Clinician Engagement
• Vital to engage clinicians in product and vendor decisi...
Price transparency for medical devices
• Physicians often unaware (unconcerned) about absolute
product price.
• Choices ba...
Price transparency
• Sellers market power!
• Patents, non-uniform pricing, complex contracts
• Preferences often not re-vi...
Greater Standardisation
• Reduce waste
• Reduce inventory
• Reduce work
• Reduce risk
• Reduce unit price
Value Based Purchasing
• Payment method that rewards quality of care
through payment incentives and transparency,
broadly ...
Greater standardisation
• Why do we stock every
brand and every type of
orthopaedic cement?
• Why do we have 5 brands
of T...
Involve doctors in decision making
• By groups or elected representatives
• Avoid self appointed opinion leaders
• Let the...
Match clinicians to the issue to be
considered
• Avoid one or two “Clinician Representatives”
providing token representati...
Not all advice is evidence based
A case study
• Surgeons had a variety of available harmonic energy
devices with individual preferences
• Two options for o...
Energy devices continued
• Another new energy device appears on market
• Significantly cheaper still
• Surgeons evaluate
•...
Laparoscopic trocars
• High volume
• Multiple providers
• Little difference in
functionality
• Proposition to
consolidate
...
Rebatable items
• Wide choice in
pacemakers &
defibrillators
• No preferred provider
• Frequent change in
clinician prefer...
Current example:
Sterile fluids
• 1 Litre 0.9% saline
• Company A - $ X
• Company B - $ 0.38 X
• Similar savings on other ...
Engagement doesn’t always save money
• Laparoscopic equipment
tender
• 5 vendors trialled
• 2 rejected by clinicians
• Ven...
Clinical Governance
• “A framework through which organizations are
accountable for continuously improving the quality
of t...
Governance
Clinical & Corporate
• “..if management if about running a business, then
governance is about seeing that it is...
Cabrini Structure
Cabrini Structure
One of three Board Committees
Corporate Governance
Clinical Governance
Ultimately it’s about the patient
Future opportunities
• Improved costings
• RFID tagging of consumables
• RFID tracking of patients – assists with measurem...
Conclusion
• Clinician engagement is feasible
• Make finances transparent
• Work to align organisational and individual go...
Thank you.
Questions?
A/Prof Val Usatoff MBBS(Hons), MHSM, FRACS, FACHSM
Deputy Medical Director, Cabrini Hospital, Melbou...
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Assc/Prof Val Usatoff - Cabrini Health - Time Efficient and Appropriate Clinical Engagement : Balancing Corporate and Clinical Governance

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Assc/Prof Val Usatoff delivered the presentation at the 2014 National Hospital Procurement Conference.

The 2014 National Hospital Procurement Conference explored a number of cost-saving measures in the hospital procurement ecosystem. Highlights included sessions on improving efficiency, savings and patient safety within Australian Hospitals.

For more information about the event, please visit: http://bit.ly/hosprocurement14

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Assc/Prof Val Usatoff - Cabrini Health - Time Efficient and Appropriate Clinical Engagement : Balancing Corporate and Clinical Governance

  1. 1. Clinical Engagement. Balancing Corporate and Clinical Governance A/Prof Val Usatoff MBBS(Hons), MHSM, FRACS, FACHSM Deputy Medical Director, Cabrini Hospital, Melbourne
  2. 2. Disclosures • Salaried employee of Cabrini Health • Salaried employee of Bayside Health • Salaried employee of Western Health
  3. 3. About Cabrini Health • Not for profit private health group • 2 acute hospitals – 500 and 100 beds • 20 operating theatres • Emergency Department • 2 Rehabilitation sites • Palliative Care and Aged Care facilities • Integrated, home based care program (HITH) • Technology and Linen divisions.
  4. 4. Assoc. Prof Val Usatoff Deputy Medical Director, Cabrini Hospital • Practicing General and HPB Surgeon • Cabrini Hospital, Alfred Hospital, Western Hospital • Executive of the ANZHPB Association • Head of Upper GI/HPB Surgery Western Health • Fellow of the College of Health Services Management • Masters in Health Services Management (Monash) • University Teaching Affiliations • Monash University • The University of Melbourne • Cabrini Leadership • Chair Perioperative Services Committee • Craft Group Leader Upper GI Surgery • Chair Infection Control Committee • Doctors Accreditation
  5. 5. Setting the scene • Patients and families are the focus of our care • But: • Clinicians bring the elective procedural work • Most of our clinicians are not employed by Cabrini • “secondary customers” • They have alternative hospitals seeking their services • Clinicians value safety, clinical outcomes and efficiency • Mostly they value….
  6. 6. Traditional idea of autonomy is changing Clinician Autonomy Clinical Governance Regulatory Compliance National Standards Commercial Pressures
  7. 7. Changing the paradigm Doctor as customer The compliant doctor Engaged doctor as partner
  8. 8. Engaging Doctors in the Health Care Revolution • Doctors are deeply anxious and angry about transformation, fearing loss of autonomy, respect, and income. • Any ambitious strategy that they do not embrace is doomed. • Stages of grief; from denial to anger • Suggest focusing on what can be gained, positives. Lee T, Cosgrove T. Harvard Business Review. Engaging Doctors in the Health Care Revolution. June 2014
  9. 9. How can doctors be engaged? • Align goals of individuals and organisation • Demonstrate that you are running a business • Cabrini success is linked to their success and vice versa • Provide information on specialty and individual performance • Link financial outcomes to rewards/incentives* • Involve doctors in decision making
  10. 10. Characteristics of effective engagement • Two surveys by the Department of Health and Healthcare Financial Management Association (UK). • >95% of clinicians and financial managers • Agreed that high quality services would only be affordable if clinical and finance colleagues are properly engaged to achieve the desired outcomes together. http://www.hfma.org.uk/publications-and-guidance/publications.htm?sort=1&keyword=clinical%20engagement&categories=info_8
  11. 11. The top three barriers – according to Clinicians • Lack of basic financial awareness/skills among clinicians • Lack of robust cost data • Poor presentation of financial and clinical data
  12. 12. The top three barriers – according to Finance Managers • Variability of cost and income data • Lack of robust cost data • Lack of basic financial awareness/skills among clinicians
  13. 13. Both groups agreed – good engagement requires… • Availability of good data • Clinical • Financial • Clinical champions AND Finance champions • Shared vision and culture.
  14. 14. • Identification of clinical champions • Early education of process • Standardisation of process, - “hassle free” • Communication • Financial consideration • Careful scrutiny of truly new technology • Vs minor changes to existing procedures/equipment • Beware new “best practice” that is more expensive • Care when being early adopter
  15. 15. Why does engagement matter? • Business viability • Safety • Quality • Willingness to adopt and accept change • Better communication • Greater standardisation • Reduced waste • Opportunities for volume discounts and rebates
  16. 16. Medical staff engagement. The risks of getting it wrong. Poor Engagement + Underutilised Capital “Why did you listen to him – he knows nothing!” “Other hospitals have much better….” “You bought the wrong equipment”
  17. 17. Organisational commitment to engagement
  18. 18. Rational and emotional engagement. Both required to drive performance ..increased willingness to go above and beyond the normal job demands…. …managers are one of the strongest drivers of engagement….
  19. 19. Myths surrounding the business. • “But we are concerned with clinical outcomes” • “Aren’t you not for profit?” • “Aren’t you making plenty of money?” • “Doesn’t the Catholic Church contribute to you?”
  20. 20. Demonstrate you are running a business • Talk about it • Write about it • Show them the financial reports • Tell them your successes and failures • Talk about the external environment • Health funds • PBS reforms • Pathology and Medical Imaging changes
  21. 21. …just means that we spend money thoughtfully and mindfully.
  22. 22. Clinical Costings – Providing information at Specialty and Individual level • A single specialty, procedural financial data Doctor Total Profit DirectCosts Indirectcosts Total Revenue Separations ALOS Profit / Sep Ave Cost/ sep Ave Rev/ sep Ave Hours ICU Ave OT Mins Profit per OBD A (-236,014) $ 542,466 $ 191,048 $ 497,501 143 1.87 (-1,650) 5,129 3,479 0.03 97 -$881 B (-148,075) $ 284,582 $ 108,409 $ 244,917 62 3.08 (-2,388) 6,339 3,950 0.00 106 -$775 C (-81,086) $ 278,939 $ 110,103 $ 307,957 95 2.16 (-854) 4,095 3,242 0.24 91 -$396 D (-54,262) $ 295,149 $ 96,399 $ 337,287 116 2.12 (-468) 3,375 2,908 0.00 74 -$221 E (-28,594) $ 70,365 $ 14,746 $ 56,517 29 1.17 (-986) 2,935 1,949 0.00 75 -$841 F (-16,936) $ 175,216 $ 45,346 $ 203,626 43 3.00 (-394) 5,129 4,735 0.49 115 -$131 G (-15,686) $ 155,335 $ 60,279 $ 199,929 77 2.05 (-204) 2,800 2,596 0.34 41 -$99 H (-11,527) $ 144,262 $ 38,381 $ 171,117 60 1.85 (-192) 3,044 2,852 0.00 62 -$104 I (-5,776) $ 103,395 $ 41,709 $ 139,329 70 1.76 (-83) 2,073 1,990 0.00 33 -$47 J (-3,140) $ 9,836 $ 2,802 $ 9,498 1 9.00 (-3,140) 12,638 9,498 0.00 260 -$349 K (-2,266) $ 8,675 $ 2,745 $ 9,154 2 1.00 (-1,133) 5,710 4,577 0.00 125 -$1,133 L 666 $ 226,109 $ 78,187 $ 304,964 163 1.36 4 1,867 1,871 0.00 34 $3 M 11,737 $ 319,022 $ 85,360 $ 416,119 127 1.99 92 3,184 3,277 0.20 64 $46 N 18,352 $ 146,763 $ 81,328 $ 246,445 112 1.99 164 2,037 2,200 0.00 31 $82 O 28,825 $ 133,660 $ 59,569 $ 222,056 108 1.44 267 1,789 2,056 0.00 28 $186 P 30,262 $ 331,169 $ 104,380 $ 465,812 133 2.74 228 3,275 3,502 0.00 34 $83 Q 108,008 $ 250,725 $ 122,409 $ 481,143 179 2.08 603 2,085 2,688 0.42 29 $290 R 203,563 $ 830,412 $ 297,014 $ 1,330,993 477 2.22 427 2,364 2,790 0.49 28 $192 Total (-201,948) $ 4,306,082 $ 1,540,214 $ 5,644,363 1997 2.07 (-101) 2,928 2,826 0.21 49 -$49
  23. 23. Incentives – do they work? • Yes! • What’s in it for me? • Tickets, dinners, trips – short term, trivial • Financial sharing arrangements – difficult to administer • Sustained improvements to productivity – meaningful, win-win • Increased theatre efficiency improvement • Unit/division secretarial support • Data manager, IT support • New equipment • HFMA round table – physicians more interested in efficiency gains than direct rewards https://www.ecri.org/Documents/MDPT/Implant%20roundtable.pdf
  24. 24. Pricing Awareness? • 503 respondents • Survey finds few orthopedic surgeons know the costs of the devices they implant. • Implants account for up to 87% of cost of procedure • Three fold variation in prices paid by hospitals • 80% rated knowledge of cost > moderately important • 36% surgeons and 75% residents rated their knowledge as poor or below average • Only 20% able to estimate cost (+/- 20%) correctly Okike K, et al. Health Affairs. 2014;33
  25. 25. Doctors know the trends • Reluctant to change some practices. • Often eager to adopt new (?sexy) innovations • But beware the enthusiastic early adopter
  26. 26. Survey of US Physicians - 2013 • 6/10 say doctors have the greatest influence on medical technology purchasing decisions. • 7/10 believe that physician-led peer review and evidence based guidelines are leading best practices when selecting and purchasing medical technologies. http://www.deloitte.com/view/en_US/us/Insights/centers/center-for-health-solutions/a5ee019120e6d310VgnVCM1000003256f70aRCRD.htm
  27. 27. Common Supply Pitfalls • Underinvestment in Clinician Engagement • Vital to engage clinicians in product and vendor decisions • Choices driven by desire for patient care • Support of leadership committees is crucial • Not consolidating vendors • Utilisation/volume savings • Efficient inventory management • Poor contract compliance • Implement and monitor Rizzo E. Hospital Review 2013. The supply chain’s role in making or breaking hosptials’ margins, competitive edge.
  28. 28. Price transparency for medical devices • Physicians often unaware (unconcerned) about absolute product price. • Choices based on familiarity, brand, relationships, history, performance. • Pricing often “blurry” • Potentially divergent objectives; hospitals vs physicians • Manufactures exploit this divergence • Loyalty, promotion, education, support • Transparent pricing required for meaningful discussions Pauly M, Burns L. Health Affairs 2008. Price transparency for medical devices
  29. 29. Price transparency • Sellers market power! • Patents, non-uniform pricing, complex contracts • Preferences often not re-visited over long periods • Target doctors individually • Hospitals’ purchasing power? • Driven by doctors – surrogate buyer • Volume variation between hospitals • Ambiguous price information • Difficult to source cost data from others • Cost of price/product comparison and change
  30. 30. Greater Standardisation • Reduce waste • Reduce inventory • Reduce work • Reduce risk • Reduce unit price
  31. 31. Value Based Purchasing • Payment method that rewards quality of care through payment incentives and transparency, broadly a function of quality, efficiency, safety, and cost. • Measurement should be able to answer the question, “Is care safe, timely, efficient, effective, equitable, and patient-centered?” • Each of these six elements is critical http://www.nbch.org/Value-based-Purchasing-A-Definition
  32. 32. Greater standardisation • Why do we stock every brand and every type of orthopaedic cement? • Why do we have 5 brands of TED stockings?
  33. 33. Involve doctors in decision making • By groups or elected representatives • Avoid self appointed opinion leaders • Let them evaluate but not negotiate with vendors • Get them to ask the rep’s about cost and pricing • Involve them in meetings with vendors • Show them business cases and invite comments • Tell them the price differentials in the offers • not absolute price which may be confidential • Ask them to prioritise CAPEX requests
  34. 34. Match clinicians to the issue to be considered • Avoid one or two “Clinician Representatives” providing token representation on Equipment Committee • Only ask doctors about decisions related to their specialty • Don’t waste more of their time than is necessary • Schedule meetings out of hours • Beware unilateral strong advocates
  35. 35. Not all advice is evidence based
  36. 36. A case study • Surgeons had a variety of available harmonic energy devices with individual preferences • Two options for open surgery • One rotates 360 degrees • One rotates 270 degrees • Price differential approx $200 per unit • Price made known to surgeons • Option put to only purchase cheaper unit • Surgeons agree
  37. 37. Energy devices continued • Another new energy device appears on market • Significantly cheaper still • Surgeons evaluate • Some specialties find it acceptable • One specialty rejects • None prefer • All but one specialty agrees to switch • After one year – original company notes decline in sales – matches price.
  38. 38. Laparoscopic trocars • High volume • Multiple providers • Little difference in functionality • Proposition to consolidate • Consultation re preferred device • Consensus achieved • Major savings due to volume discount
  39. 39. Rebatable items • Wide choice in pacemakers & defibrillators • No preferred provider • Frequent change in clinician preference • Implications for patient safety – tracking of devices • Offers made to major companies to provide proposal to become preferred supplier • Clinicians advised which company to prefer – if devices therapeutically equivalent • Major consolidation to one provider • Cardiac data manager funded from savings
  40. 40. Current example: Sterile fluids • 1 Litre 0.9% saline • Company A - $ X • Company B - $ 0.38 X • Similar savings on other preparations • Trivial? • Savings >$510,000/per annum • Beware quick change • Trial with key stakeholders – anaesthetists, PACU nurses • Allow company A to price match
  41. 41. Engagement doesn’t always save money • Laparoscopic equipment tender • 5 vendors trialled • 2 rejected by clinicians • Vendor A preferred but substantially more expensive than close second choice vendor B • Clinicians elect for vendor B as relatively ambivalent when shown price difference • Fibreoptic endoscopy tender • 2 major suppliers • Vendor A significantly more expensive • Universal user preference for Vendor A • Vendor A chosen despite cost in view of clinician preference
  42. 42. Clinical Governance • “A framework through which organizations are accountable for continuously improving the quality of their services and safeguarding high standards of care by creating an environment in which excellence in clinical care will flourish.” • Evidence based standards of care • Monitoring performance • Implementing change NHS Executive 1998
  43. 43. Governance Clinical & Corporate • “..if management if about running a business, then governance is about seeing that it is run properly.” • Growing (general and legal) awareness that there is corporate responsibility for adverse events and poor outcomes. • The connection between the board and the “front line” is effectively clinical governance. Australian Nursing Journal, May 2000
  44. 44. Cabrini Structure
  45. 45. Cabrini Structure One of three Board Committees Corporate Governance Clinical Governance
  46. 46. Ultimately it’s about the patient
  47. 47. Future opportunities • Improved costings • RFID tagging of consumables • RFID tracking of patients – assists with measurement of time in OR etc • Appointment of clinical leaders • Seek evidence based decisions • Encourage clinician attendance at management meetings eg. cardiac, perioperative, maternity • Not just specialty group meetings. • Insight into broader issues.
  48. 48. Conclusion • Clinician engagement is feasible • Make finances transparent • Work to align organisational and individual goals • Make them accountable to their peers for decisions • Involve clinicians from the outset • Always stress that changes must not be at expense of quality and safety
  49. 49. Thank you. Questions? A/Prof Val Usatoff MBBS(Hons), MHSM, FRACS, FACHSM Deputy Medical Director, Cabrini Hospital, Melbourne
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