9/4/2018

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LEAN PROCESS IMPROVEMENTTAKING CARE OF BUSINESS

TODAY’S AGENDA

• What and Why Lean Introduction

• Value Added• Revenue Cycle Project Highlights

Customer Perspective and

Results

• 5S• Value Stream Mapping• Standardization

Some Powerful Lean Tools

WHAT IS LEAN

Problem Solving Muscle

A lean culture empowers employees

and focuses on the customer.

Lean is about a culture of continuous quality and process

improvement:

Creating Value

Reducing costs

Improving efficiency

Improving productivity and

Improving quality-higher standards

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FOUR QUESTIONS TO CONSIDER

1. What % of your representative day is spent re-working something someone else started?

2. What percentage of your day is spent doing something someone else has to re-do

3. What percentage of your day is non-value added?The first 3 questions, should not exceed 100%

4. How would your customers rate you in terms of how well you provide for their needs and requirements on a scale of 1-10?

To be value added, the activity needs to meet three criteria:

1. Change form, fit or function

2. Be valued by the customer

3. Done right the first time

Quality/Cost = Value

VALUE ADDED

COMBINING LEAN AND SIX SIGMA

Variation in a process is what customers feel –not the average

Six Sigma measures variation• 6 sigma level – 3.4

DPMO or less than 4 customers/million

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LEAN SIX SIGMA AT WORK

The relentless pursuit of the perfect process through waste elimination…Eliminating all non-value added time, motion and stepsResults driven – significant business impact to move one sigma level

We Spend 75-95% of Our Time Doing Things That Increase Our Costs and Create No Value for the Customer!

8 TYPES OF WASTE“DOWNTIME”

D: Defects

O: Overproduction

W: Waiting

N: Non-utilized resources

T: Transportation

I: Inventory

M: Motion

E: Excessive Processing

REVENUE CYCLE PROJECTS

Getting Results

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LATE CHARGE REDUCTION

Purpose: Reduce Late Charge AWO’s.

Why this Project:

• Needed to ID why

• Trending growth upwards

• Significant financial impact

• First 8 months of the year $3.1 million in late

charges, of which $1.12 million adjusted off

without billing for the services provided.

LATE CHARGE REDUCTION

1121 1123

13291375

1196

1307

1205

1277

1177

1452

1180

995957

661

494

383

294 270320

361

222174

225 219

JAN

FEB

MAR

APR

MAY

JUN

JUL

AUG

SEP

OCT

NOV

DEC

JAN

FEB

MAR

APR

MAY

JUN

JULY

AUGUST

SEPT

OCT

NOV

DEC

2016 2017

Late Technical Charges for Clinics2016‐2017

Achieved $735,000 bottom dollar impact in 2017 alone

REDUCING DUPLICATE PATIENT RECORD GENERATION

Purpose: Ensuring patient identification data integrity to enhance the cleanliness of our master patient index (MPI).

Why this project- The solid principles of accuracy, completeness, and data integrity are the foundation for patient safety in the EHR.

Current State Problem Statement Key Points:

• Error rate - 21.7%, compared to the best practice benchmark of 2%. (National average is 12%).

• Averaging > 400 errors/month that need to be re-worked at an average cost of $50/error ($240,000 annually).

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REDUCING DUPLICATE PATIENT RECORD GENERATION-RESULTS

0.082%

0.045%0.042% 0.041%

0.060%

0.046%

0.029%

0.051%0.053%

0.044%

0.056% 0.055%

0.059%

0.065% 0.065%

0.074%

0.062%

0.053%

0.031%

0.000%

0.010%

0.020%

0.030%

0.040%

0.050%

0.060%

0.070%

0.080%

0.090%

Jan Feb March April May June July August Sept Oct Nov Dec Jan Feb March April May June July

RATE

2017‐2018 YTD

Monthly Trend of M Number Errors

Achieved and sustaining greater than best practice goal of 2% or less.

POINT OF SERVICE (POS)COLLECTIONS

Purpose: Address root cause of patient complaints and improve cash collections

Why this project:

• Customer complaints upon receiving their

bill that does not give credit for the POS payments made.

• Over $600,000 in unapplied dollars secondary to gaps in our POS Collection

process that lead to challenges in knowing what encounter and/ or account to apply the credit to (11,000 encounters )

POS COLLECTIONS- RESULTS

 $‐

 $100,000

 $200,000

 $300,000

 $400,000

 $500,000

 Unknown Unapplied(account level)

 Clinics  (encounter level)

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POS COLLECTIONS - RESULTS

$234,239.00 

$208,898.00 $221,821.00 

$195,121.00 

$346,623.00 

$303,400.00 

Q1 2016 Q2 2016 Q1 2017 Q2 2017 Q1 2018 Q2 2018

POS Collections by Quarter 

Achieved >$200,000 in POS Cash Collections in first 2 quarters of year from previous 2 years

SCRUBBING REPORT ERROR REDUCTION

Purpose: Improve clean claim rate timeliness of payment

Why this project:

• Average number of errors per day - 2,038 and the errors were not being corrected in a timely matter.

• Have achieved and sustained a 72-79% decrease in errors per day.

PRE-AUTHORIZATIONS

Purpose: Reduce the administrative burden and challenges of obtaining pre-authorization

Why this project:

• Increasing number of denials secondary to pre-authorization

• Growing volume of re-working accounts

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PRE –AUTHORIZATION TOOLKIT

General Info•Glossary of commonly used terms•Office contact information•Patient Medical Info – how to export •Pre-Authorization definitions

Payer Info•Evicore•Medicaid•Tricare•Insurance Contact Numbers•Payer Summaries- processes, tips and challenges

Pre-Authorization Manuals•Meditech Authorization process•Next Gen Authorization process•Matrix Care Authorization Process•Senior Services Authorization Form

Care Coordination Authorization Info•Authorization for Surgery Form•Flights•Medical Necessity for Air Medical Transportation•Office Contact info•Tool – IP Only Procedures

Portals – Payer portal info and web addressees

SOME POWERFUL LEAN TOOLS

• 5S

• Value Stream Mapping

• Standardization

SORTSET IN ORDERSHINESTANDARDIZESUSTAIN

5S

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MAKING IT VISUAL

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VALUE STREAM MAPPINGGOING TO THE GEMBA –WALKING THE PROCESS

NEW EMPLOYEE ONBOARDING

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VALUE OF WALKING PROCESSONBOARDING PROCESS

MISSING ORDERS

Service provided, no order?

THE VALUE OF WALKING THE PROCESSMISSING ORDERS

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THE VALUE OF WALKING THE PROCESSMISSING ORDERS

MISSING ORDERS PROJECT RESULTS

Improved to 2.4 Sigma level within 2 months• Baseline Sigma level – 1.9

Prevented Write off of $635,274 (at 40% reimbursement rate = $254,109.60 revenue )

Days to Final Abstract Status by Coding Decreased: • Baseline = 23.97 Days• 3 months post implementation=11.25 Days

Increased cash flow in one time collections by $705,177

ACCOUNTING – MONTHLY CLOSING PROCESS

Saved 29 hours out of current process and reduced 2 days in monthly closing process

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STANDARDIZATIONELIMINATING PROCESS VARIATION

ATTACK VARIATION

Which is the major cause of variation in results?

People Materials

Equipment Work Methods

Results

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TEAM PROJECT

You and your team have to be able to produce a pig upon request to meet customer demand.

It is very important for your customers to have a consistent product that they can rely on when needed.

IN SUMMARY

• LEAN is about a culture of continuous improvement. It is a journey and is a very effective problem solving methodology

• Toolbox tools highlighted:

5S

Value Stream Mapping

Standardization

THANK YOU

LAURA MERCHANT, PT, MBA/HCM, FACHE, CERTIFIED LEAN SIX SIGMA BLACK BELT

PARAGON CONSULTING, LLC, GREAT FALLS, MT.