Case in Brief: Henry Ford Medical Group provider employed medical group affiliated with Henry Ford Health System, based in Detroit, Michigan

Transcription

1 Henry Ford Medical Group: Moving to Top of License and Productivity Case in Brief: Henry Ford Medical Group 1300-provider employed medical group affiliated with Henry Ford Health System, based in Detroit, Michigan System facing extreme financial pressure in challenging reimbursement market Focused on efficiency, new ways to grow revenue 1

2 Many Sources of Financial Pressure (nationally) Unfavorable payer mix Price-sensitive consumers Aging population Forgone revenue through lower utilization; reduced costs benefit patient And pressures faced locally by HFMG: Lower productivity from Epic implementation Ultra-competitive market Poor macro-economic conditions Average commercial contract rate as a percentage of Medicare: HFMG: 115% 2

3 Our work with Navigant was the first step of many that we will take towards building the new way that health care is delivered. We cannot afford to continue providing health care in the way we are now. 6 3

4 We attempted to create radical value for our customers through exceptional convenience and trusted quality. 7 In the next year, our goal is to make significant and specific operational changes that will get us to a stable financial state, so that we best position ourselves to pioneer the future. 4

5 Specifically, we will: - Have different job duties by role - Have different staffing models - Be in different locations - Incentivize different things KEY MESSAGES Four (4) areas for Operational Improvement» There were four (4) major opportunities that could create a $30M - $50M improvement in performance: Enhancing clinical models and reengineering workflow and right-sizing will save over $18.1M Overhead reduction opportunities related to medical surgical supplies, administrative services and billing and collection services can be achieved without compromising patient service and save $16.3M. By realigning physicians and staff, redistributing patient volume and merging limited sites, a real estate/service consolidation opportunity of $6.3M can be achieved. Physician productivity improvement of $17.4M (Net of accompanying increased physician compensation) can be achieved through improved patient access, aligned compensation incentives, and a coordinated focus on growth and operational efficiency *Note: these findings are exclusive of revenue cycle opportunities Page 10 5

6 HARVESTING THE FINANCIAL OPPORTUNITY To meet its strategic objectives, an aggressive approach to workflow re-design, overhead reduction, administrative leadership, and organizational productivity must be adopted» The opportunities for significant improvement are available to HFMG (indicated in the chart at right)» The practice should pursue a three tiered strategy that will yield the financial improvement contemplated below: Phase I: Reengineer current operations Phase II: Stabilize infrastructure, workflow processes, staffing levels, and systems Phase III: Reinvest in strategic growth opportunities Performance Improvement Overview (in $MM) Conservative Aggressive Workforce (Labor) Physician Productivity (Physician Compensation) (16.30) (16.30) Overhead (non-labor) Site/Service Consolidation Implementation Risk (25.00) (25.00) Total Opportunity Note: Revenue Cycle is not included in this analysis Page 11 WORKFORCE ANALYSIS AND OPPORTUNITIES Roles and responsibilities are misaligned resulting in inefficient utilization of general administrative staff and RNs. Resolving this imbalance could save the group $18M.» Navigant analyzed the workforce using four different metrics: FTEs per 10,000 WRVUs, FTE s per physician, FTE s per provider and as a percentage of Net Medical Revenue» In order to realign and maximize efficiency HFMG will need to; Evaluate roles and responsibilities of administrative and clinical positions HFMG Paid FTEs Per 10,000 wrvus Market 50th Paid FTEs %tile Paid per 10,000 FTEs per wrvus 10,000 wrvus Net FTE Impact Median Savings Opportunity Business Staff General Administration (358.37) $ 20,066,741 Medical Receptionists $ (9,685,101) Clinical Staff Registered Nurses (208.22) $ 14,470,586 Medical Assistants $ (6,729,275) Total Opportunity $ 18,122,951 Re-assess the duties of the administrative and clinical support staff to ensure that staff is working at the top of licensure Effectively implement KPI s to monitor staff utilization on a daily/hourly basis to re-allocate staff when provider and patient volumes fluctuate Page 12 6

7 Completed detailed RN/MA benchmarking review Completed workflow optimization pilots in two key specialties (Cardiology and Plastic Surgery) Created operations playbook which included: Roles and responsibilities for clinic staff MA job descriptions Clinical workflow improvement opportunities Epic tips and tricks Reference articles regarding the MA Clinical Model Results and key takeaways from Workflow Pilots Work closely with HFMG implementation team to ensure appropriate handoffs 13 WORKFORCE - CLINICAL WORKFLOW ANALYSIS Many of the observed clinical workflows do not enable providers and clinical support staff to work at the top of their licensure creating inefficiencies and frustration» There is a lack of clarity of roles and responsibilities Span of management control is not clear Inconsistent communication exists between leadership, product line administrators and clinic locations» Reporting metrics are underutilized by front line mangers and need to be further developed and integrated in daily team work processes» Optimal workflow procedures, processes and protocols have not been executed Silo behavior observed between clinic operations» Epic Implementation- Amplified Workflow Deficiencies Reporting metrics are unavailable to the front line mangers or are unreliable or under-developed 14 7

8 PHYSICIAN WORKFORCE REMEDIATION AT MEDIAN If HFMG cannot increase productivity, then physician workforce may need to be reduced to a competitive level based on current patient volume and workflow. This reduction, if necessary, would generate between $12.5-$15.1M.» If HFMG is not able to increase its productivity, then it should consider remediation of its physician workforce to meet the demand of its patient population Based on the 2012 CFTE designation and current productivity, HFMG has an opportunity to realign physician workforce by decreasing to CFTEs. This would result in a cost savings between $12.5M and $15.1M Site observations indicate low patient volumes, empty clinics, and underutilized space, supporting the demand concerns. Page 15 Management Span of Control Period: Annual data ending Q Source: ActionOI, NCI Analysis 25th Percentile 40th Percentile 50th Percentile Compare Group Average Clinic Management % Span of Control Management % Span of Control Management % Span of Control Management % Cardiology 2.7% 1:18 5.6% 1:8 7.3% 1:9 7.5% 1:12 Dermatology 3.5% 1:17 5.1% 1:10 5.7% 1:7 7.7% 1:10 Endocrinology 3.5% 1:10 5.2% 1:11 7.0% 1:11 5.5% 1:13 ENT 2.6% 1:54 5.7% 1:14 6.8% 1:14 6.3% 1:12 Family Practice 2.3% 1:13 5.2% 1:11 6.7% 1:12 6.9% 1:14 General Surgery 2.3% 1:33 4.2% 1:15 6.2% 1:12 7.9% 1:13 General Medicine 1.7% 1:23 4.8% 1:11 6.3% 1:11 7.0% 1:13 Gastroenterology 2.0% 1:12 5.3% 1:5 5.7% 1:6 6.9% 1:8 Hem/Onc 1.9% 1:23 4.0% 1:12 4.6% 1:12 5.8% 1:18 Neurophysiology 2.8% 1:11 5.6% 1:10 6.8% 1:13 8.1% 1:12 OB/GYN 3.9% 1:8 6.7% 1:8 8.0% 1:10 8.0% 1:11 Orthopedics 2.6% 1:18 4.1% 1:13 5.7% 1:10 8.3% 1:11 Pain Management 0.0% N/A 0.0% N/A 0.0% N/A 10.4% 1:9 Plastic Surgery 0.4% 1:36 9.1% 1:9 12.2% 1:6 10.7% 1:6 Rheumatology 0.7% 1:55 3.0% 1:12 5.4% 1:6 9.0% 1:10 Urology 2.8% 1:33 3.7% 1:9 5.1% 1:10 5.0% 1:12 Woman's Health 0.0% N/A 0.0% N/A 2.4% 1:37 5.3% 1:15 Notes: management includes Supervisor, Manager, Director, Executive Director levels. Span of Control Definition: ratio between management to total staff in FTEs. Span of Control 8

9 FACILITY PLANNING AND SITE CONSOLIDATION HFMG has a opportunity to lower its overheard Cost through site consolidation and achieve at least a $6M savings. (Timing of leases remains a barrier)» Based on benchmarking per sq.ft., lease status and proximity to other offices, for patient absorption, there are site consolidation opportunities which need to be fully vetted. Page 17 Page 18 9

10 Project Opportunity Performance Improvement Overview (in $MM) Conservative Aggressive Workforce (Labor) Physician Productivity (Physician Compensation) (16.30) (16.30) Overhead (non-labor) Site/Service Consolidation Implementation Risk (25.00) (25.00) Total Opportunity Project Outcomes Vetted & Not Vetted but Performance Improvement Overview (in $MM) Recommended Recommended Workforce (Labor) Physician Productivity Physician Remediation Overhead (non-labor) Site/Service Consolidation Total Opportunity PATHWAY TOWARD IMPLEMENTATION Without a focused implementation team, HFMG will not realize the $30M - $50M in opportunity» *Phase I: Reengineer current operations and workflow to achieve targets Re-engineer core processes to optimize Epic implementation and capitalize upon: People Process Organization Technology» Phase II: Standardize infrastructure, processes, staffing levels, and systems Realign staffing to improve efficiency in the practices Create transparency across the organization to maximize accountability and integration» Phase III: Reinvest in strategic growth opportunities Re-design physician compensation plan Create partnerships with health system business units Promote access and patient satisfaction *Phases may overlap Page 20 10