Cost containment is a group effort - clinical outcome system - Vantage Point

Healthcare Financial Management, April, 1996 by William H. Nelson

Healthcare financial managers continually seek ways to manage costs in their organizations. Historically, they have sought to contain costs by concentrating on the individual units of care that patients receive--an x-ray procedure or a day of hospital stay, for example. The goal has been to reduce the amount of resources needed to diagnose or treat patients. While this approach to cost containment is still useful, a better approach to containing cost in the long term is to effectively and efficiently improve clinical outcomes by improving the patient care processes. The idea of improving clinical outcomes as a way to contain and manage costs has become wide-spread in the last five years. An outcomes improvement system that provides answers to questions such as the following can contribute to the welfare of patients and the organizations' bottom line:

* Can the health status of enrolled populations be improved by encouraging preventive measures meant to keep people healthy and, therefore, out of the hospital?

* Can process models be put in place that improve patient care by using hospital resources more efficiently?

* Can postsurgical wound infection rates be reduced by administering antibiotics before surgery?

* Is there a maximum window of effectiveness for antibiotics?

It is difficult, however, to find the best way to implement a clinical outcome system that will provide answers to these questions. One way providers can create a system that will improve clinical outcomes is by engaging in continuous quality improvement processes and techniques. Some organizations that have engaged in such processes report promising results.

One organization, for example, examined postsurgical infection rates--just one aspect of its surgical process. Clinicians discovered that administering antibiotics two hours before certain surgical procedures were performed substantially reduced the rate of postoperative infection. That, in turn, shortened recovery time and reduced patients' lengths of stay, thereby saving the organization time and money.

Some patients become concerned when they are told that they will be discharged from the hospital sooner than they had expected. They may believe that they will not get all the care they need, but such beliefs are unfounded. Patients discharged earlier than they might have been when they underwent similar procedures in the past actually are benefitting from improved clinical outcome systems that have reduced their lengths of stay.

Healthcare organizations must find ways to achieve the objective of improving patient care and containing cost. Relationships between clinicians and nonclinicans are already changing, but dramatic improvement is difficult when there are not enough economic incentives to force or to reward changes. One of the challenges financial managers face, therefore, is determining how to provide significant incentives--both financial and clinical--to motivate healthcare service professionals to work together more effectively. I believe that enterprising people who face competition head on will find ways to provide those incentives, continue to contain costs, and improve the quality of care patients receive.