Hospital Transformation through Z B d B d tiZero Based Budg

Hospital Transformation through
Z B d B d tiZero Based Budgeting
Windsor Regional Hospital
Medical Programs/Departments Orientation Session
June 18 & 19, 2008
g p
AgendaAgenda
Project Background & ObjectivesProject Background &
Objectives
Organizational Transformation Through ZBB
Improving Performance of the Organization
Medical Programs/Departments Workshops/Workbooks
Project Organization
Project Schedule
Questions
2© 2008 Hay Group. All Rights Reserved

BackgroundBackground
U d t d th i i ti t l t ffi d Unprecedented growth in programs,
services, patient volume, staffing and
facilities; now $270 million in revenues and activity
Growth has resulted in operating losses and a working capital
deficit of
i l $55 illiapproximately $55 million
WRH has worked hard to significantly reduce operating costs:
− From 26% higher than expected cost per weighted case five
years ago
− To only 10% above expected cost per weighted case currently
− But, this is still a problem for negotiatio ns with LHIN and
MOHLTC
WRH must continue to transform operations to achieve
efficiency p y
breakthroughs that will provide additional cost reductions
Zero Based Budgeting (ZBB) provides a tool to rethink
approaches to service
delivery to reduce costs
delivery to reduce costs
Zero Based BudgetingZero Based Budgeting
Historically hospital budgets have been set based on
adjustments to the Historically, hospital budgets have been set
based on adjustments to the

budget for the prior year
After several years, budgets don’t necessarily reflect what is
currently needed
if they are based on:if they are based on:
− Past operating characteristics
− Past technologies
− Past inter-departmental interactions/interdepende nciesPast
inter departmental interactions/interdependencies
Year over year adjustments:
− May not reflect changes in processes, practices and need
− May be based more on relative success in negotiations during
budget processes May be based more on relative success in
negotiations during budget processes
rather than on relative need
Building a budget from zero, rather than adjusting last year’s
budget:
− Allows it to reflect current requirements and conditions not
historical anomalies
Allows it to reflect current requirements and conditions, not
historical anomalies
− Provides an opportunity/stimulus to incorporate more current
and best practices
Objectives for Transformation Through ZBBObjectives for
Transformation Through ZBB
1 Re-think methods of providing care1. Re-think methods of

providing care
2. Create more efficient processes; restructure inefficient
processes
3. Eliminate unnecessary activityy y
4. Balance workloads; better balance workload with staffing
5. Improve quality of worklife for employees
6. Reduce costs without compromising effectiveness of
delivering those
services.
7 A l h l ‘E d C 7. At a minimum, result in hospital
operating at ‘Expected Costs per
Weighted Case’
Organizational Transformation
through ZBB
Organizational TransformationOrganizational Transformation
Focus of approach to transformation is to deliver four key
results:
Accelerate realization of vision
− Outstanding Care, No Exceptions!

Improve quality of care and customer services
Improve quality of worklife
Reduce service costs
Key Assumptions For BudgetingKey Assumptions For
Budgeting
P ti t l ( d i i d f ) ill b i t i dPatient volume (measured in
episodes of care) will be maintained:
− No decreases in necessary care
− No increases in elective activity
Patient days will be the same or be reduced:
− More outpatient care in place of inpatient care
− Shorter lengths of stay
Patient mix will be the same
Range of medical services will be the same
W k t t i d f ill b th d dWork content per episode of care
will be the same or reduced
Departmental workload will be the same or reduced
No reductions in salary or wage rates for staff

Improving the Performance of the Improving the Performance of
the
Organization
Zero Based BudgetingZero Based Budgeting
ZBB f b ildi b d t f “b tt ” th th “t d ”ZBB focuses on
building budgets from “bottom up” rather than “top down”
ZBB involves completely rethinking services and requirements
rather than
using incremental changes from prior years
ZBB at WRH will involve rethinking and designing anew the
approaches to
providing and supporting care so as to:
− Minimize unnecessary activity
− Balance workload and staffing
− Maximize efficiency
− Maintain or improve quality
− Minimize costs
New budgets for new approaches to providing and supporting
care
Process for ZBBProcess for ZBB
ZBB workshops will be held in 2 streams:ZBB workshops will

be held in 2 streams:
Medical Programs/Departments
Hospital Functional CentresHospital Functional Centres
ZBB for Medical Programs/DepartmentsZBB for Medical
Programs/Departments
W k ith di l d d i i t ti l d hi f di l Work with medical and
administrative leadership of medical
programs/departments to define anew the hospital’s approach to
providing
an episode of patient care
I i i l i id i i ZBB WRHInitial session to provide an
orientation to ZBB at WRH
A series of 5 workshops with leadership of all medical
programs/departments:
1. Identifying best practices
2. Service delivery models, content of care
3. Workflow, delays, discharge planning
4. Materials content of care and sourcing
5. Review
Following each workshop, representatives of each
program/department will

g p, p p g p
complete a workbook related to workshop content
Medical Programs/Departments Participating in
ZBB WorkshopsZBB Workshops
Emergency Medicine
Family Medicine
Medicine
Oncology
Ob & Gyn
Paediatrics
CCU
ICU
Surgery
NICU
Psychiatry
Rehabilitation Surgery
Anaesthesia
Rehabilitation
Continuing Care
Other Heads of Service / Medical Directors will support
Programs/Departments in completing workbooks and/or will
support Functional Centres in budget development.

ZBB for Functional CentresZBB for Functional Centres
Work with hospital departments to rethink approaches to service
delivery Work with hospital departments to rethink approaches
to service delivery,
service interdependencies, staffing and costs
Start with initial session to provide an orientation to ZBB at
WRH
A series of 7 workshops for 5 groupings of managers:
1. Identifying best practices
2. Considering services offered
3. Considering service delivery models
4. Considering derivation of departmental workload
5. Considering benefit hours, sick time, etc.
6. Considering materials content and sourcing
7. Defining actions to implement zero based budgets
Following each workshop, Department Managers will complete
a workbook
g p, p g p
related to workshop content
Groupings of Functional CentresGroupings of Functional
Centres
Patient Care ServicesPatient Care Services
Therapeutic Services

Diagnostic Services
Support Services
Administrative Services
Medical Programs/Departments g p
Workshops/Workbooks
ZBB Workshops/Workbooks for
Medical Programs/DepartmentsMedical Programs/Departments
ZBB will consider all elements of the hospital’s care processes,
including:p p , g
− Admission decisions
− Most responsible physician models
− Service delivery models
− Process of care
− Content of care
− Materials content of care and sourcing
W k fl − Work flow
− Delays in care
− Discharge planning
Discharge − Discharge
− Post discharge care
− ALC days
New/changed patient care processes will provide new ZBB

estimates of
New/changed patient care processes will provide new ZBB
estimates of
workload for hospital Functional Centres
ZBB for Patient Care Programs/Medical DepartmentsZBB for
Patient Care Programs/Medical Departments
A series of 5 workshops with leadership of all medical
programs/departments:p p p g p
1. Identifying best practices;
2. Service delivery models, content of care
3. Workflow, delays, discharge planning
4. Materials content of care and sourcing
5. Review
Workshops will be led by Hay Group consultants Dr. Isser
Dubinsky and Adam Topp
Following each workshop, representatives of each
program/department will complete
a workbook related to workshop content
Program/department leadership will be supported by hospital
administrative staff
Initial data to support process developed by Hay Group using:
− Discharge Abstract Data/NACRS Data
− Management Information System Data

− Extant literature
Workshop/Workbook 1:
Identifying Best PracticesIdentifying Best Practices
In the first workshop/workbook you will be asked to:In the first
workshop/workbook you will be asked to:
Identify the characteristics of high performing medical
programs/departments that might be emulated by WRH
To assist in this process we will provide you with:
Data comparing the performance of WRH medical programs and
departments with high performing hospitals across Canada
Advice on how to contact and query high performing medical
programs and
departments to identify best practices that have contributed to
their
exemplary levels of performance.
Advice on how to identify examples of best practices from the
medical and
administrative literature that can contribute to improved quality
and
efficiency of patient care
y p

Considering Service Delivery Models & Content of
CareConsidering Service Delivery Models & Content of Care
I thi k h / kb k ill b k d tIn this workshop/workbook you will
be asked to:
Identify best practices in service delivery that reduce resources
used in an
episode of patient care
Determine if care delivery models are optimally using
outpatient care as an
alternative to admission (e.g., considering more use of
outpatient surgery,
more use of day hospital care, use of clinical
observation/decision units rather
than admission for ED patients, rapid follow up
clinics/diagnostics for ED
patients rather than admission, etc.)
Continued on next page
Service Delivery Models & Content of Care ContinuedService
Delivery Models & Content of Care - Continued
Determine if the content of an episode of care at WRH is
optimal:
− What services are required for all patients?
− What services are required only for selected patients?
− Are there services being provided to patients that might be
reduced or

eliminated?
For example, WRH might consider: p g
− Less use of psychology
− More selective use of clinical dietetics, OT, Clinical Nurse
Specialists,
diagnostic services, etc.
− More selective (and more intensive) use of discharge planning
− More use of more discriminating standard care plans
Work Flow; Delays in Care & Discharge PlanningWork Flow;
Delays in Care & Discharge Planning
In this workshop/workbook you will be asked to:p y
Identify best practices in work flow to reduce delays in care &
reduce ALOS
For example, WRH might consider:
St d d d t / di l di ti th t i t d d t th − Standard order
sets/medical directives so that care is not dependent on the
attendance of the physician
− Independent case finding by allied health professionals
A il bilit f ( l t d) di ti i 24/7− Availability of (selected)
diagnostic services 24/7
− Priority (morning) access to diagnostic services by inpatients
− Rapid turnaround of test results for inpatients/ED patients
M i f i b h i i− More active care management of patients by

physicians
− More immediate assignment of MRP
− Weekend and holiday discharges
− Follow up clinics for “unattached” patients
Continued on next page
Work Flow; Delays & Discharge Planning - Continued
Id tif h t d i d l i di h ft l ti f
Work Flow; Delays & Discharge Planning - Continued
Identify approaches to reducing delays in discharge after
completion of an
episode of acute care
For example, WRH might consider:
− Writing discharge orders that would expedite discharge
− Organizing care for ALC patients that would expedite
discharge
− Utilizing a wider variety of post acute care destinations, etc.
Considering Materials Content of Care & SourcingConsidering
Materials Content of Care & Sourcing

In this workshop/workbook you will be asked to:In this
workshop/workbook you will be asked to:
Consider the medical surgical equipment, devices, drugs and
supplies that
are being used at the hospital:
Wh t i ll i d f ti t ? − What is really required for patients?
− Are there opportunities to be more selective in the use of
supplies, drugs,
special diets, devices, etc.?
Are there opportunities to use lower cost medications? − Are
there opportunities to use lower cost medications?
− Are there opportunities for standardization?
− Are there ways to reduce unit costs by consolidating
ordering?
Workshop 5: Review SessionWorkshop 5: Review Session
Hay Group Consultants will summarize: Hay Group Consultants
will summarize:
Actions identified and required to implement the new care
processes
Impact of new processes on patient days and functional centre
workloadsp p p y
You will be asked to:
Confirm initiatives and potential impact

Project Organization
HayGroup Project TeamHayGroup Project Team
Project Director: Mark Hundert
Medical Departments
Dr Isser Dubinsky
Communication
Project Manager: Irene Petersen Gray
Dr. Isser Dubinsky
Adam Topp
Functional Centres:
Alyssa Montmarquette
Workshop/
Workbook Design
Patient Care Services – Irene Petersen Gray,
Adam Topp
Therapeutic Services – Kelly Jennings
g

Paula Kerr
Diagnostic Services – Adam Topp
Support Services – Robert Kimsto
Administration – Robert Kimsto
Administration Robert Kimsto
Project Schedule
Project ScheduleProject Schedule
Week Ending
23-M
ay
30-M
ay
06-Jun
13-Jun
20-Jun
27-Jun

04-Jul
11-Jul
18-Jul
25-Jul
01-A
ug
08-A
ug
15-A
ug
22-A
ug
29-A
ug
05-Sep
12-Sep
19-Sep
25-Sep
O
ngo
ing

Activity
1.0 Project Organization & Planning
2.0 Project Communication
2.1 Initiating Process
2.2 Communications Planning
2.3 Communications Delivery
3.0 Medical Dept. Zero Based Budgeting
3 1 Orientation Session
B
reak W
eek
B
reak
W
eek
3.1 Orientation Session
3.2 ZBB Workshops
3.3 Derive Departmental Workloads
4.0 Dept / Functional Centre ZBB
4.1 Orientation
4.2 ZBB Workshops
4.3 Inter-workshop activities

4.4 Refinement of ZBB
5.0 WRH Zero Based Budgets
5.1Consolidate ZBBs
5.2 Summarize recommendation
5 3 Review & approval
5.3 Review & approval
5.0 Implementation
Medical Programs/Departments
Workshop Dates & TimesWorkshop Dates & Times
Workshop 1: Wed June 25 0700 0900Workshop 1: Wed., June
25 0700-0900
Workshop 2: Thurs., July 10 0700-0900
Workshop 3: Tues., July 15 0700-0900
Workshop 4: Thurs., July 24 0700-0900
Review Workshop: Thurs., July 31 0700-0900
Q esti nsQuestions

Hospital Transformation through Z B d B d tiZero Based Budg

Hospital Transformation through Z B d B d tiZero Based Budg

Recommended

Recommended

More Related Content

More from LizbethQuinonez813

More from LizbethQuinonez813 (20)

Hospital Transformation through Z B d B d tiZero Based Budg