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Business Process Redesign in Health Care IT Types of BPR Project Management Implications Examples from the Field 10/10/20141Group 4: Farabaugh, John, Katzovitz,

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Presentation on theme: "Business Process Redesign in Health Care IT Types of BPR Project Management Implications Examples from the Field 10/10/20141Group 4: Farabaugh, John, Katzovitz,"— Presentation transcript:

1 Business Process Redesign in Health Care IT Types of BPR Project Management Implications Examples from the Field 10/10/20141Group 4: Farabaugh, John, Katzovitz, Lott, Patki, Pearce, Snow Lee Farabaugh, Susan John, Larry Katzovitz, Eric Lott, Ashwini Patki, Jessica Pearce, Josh Snow

2 Group 4: Project Agenda Overview of Business Process Redesign models used in healthcare. Applicability of principles of Business Process redesign related to overall Project Management methodologies. Effectiveness of such models as part of a Healthcare IT initiative. Examples where organizations have used such a model as part of a Healthcare IT initiative. Class exercise and questions.

3 Project Management Methodologies (Traditional) Waterfall Spiral Build and Fix

4 Traditional Methodology Model Identify Deficiencies Define Specific Proposals for Improvement Proposed System is Designed New System is Developed System is Implemented System is Continuously Evaluated and Maintained

5 Traditional Methodologies Characteristics Looked to improve existing systems or implement new systems Task oriented Processed based Step-by-step approach

6 Business Process Redesign Characteristics “Clean Slate” Outcomes oriented Priority based Cyclical approach

7 Business Process Redesign Model Envision New Processes Initiate Change Diagnosis Process Process Redesign Reconstruction Process Monitoring

8 Agile Principles Projects built around self-organized teams Rapid adaptation to changing circumstances Continuous attention to technical design Working product is the measure of progress

9 Health Care Challenges that encourage use of BPR Medical errors and high costs of healthcare Underinsured or uninsured population Increasing number of heterogeneous and older population, Globalization/ medical outsourcing, Maintaining quality for given cost and cost minimization for given quality Shortage of clinical and nursing staff

10 Expectations from BPR models Increase in efficiency Reduce medical and medication errors Health care cost reduction Better access and quality in healthcare Procedure optimization Time effectiveness Customer and health care provider satisfaction

11 Highlighted solutions Automating and monitoring processes in healthcare Redesigning or improving clinical processes where necessary and possible Identifying patient expectations and improving patient care processes for better customer services.

12 BPR – What & Why? Business Process Redesign is a set of activities undertaken to make sustained improvements in the … SPEED (lead time) QUALITY COST OF PROCESS HELPS AN ORGANIZATION STAY COMPETITIVE IN THE MARKETPLACE HELPS AN ORGANIZATION STAY COMPETITIVE IN THE MARKETPLACE

13 BPR – How? HIGH LEVEL ASSESSMENT BUSINESSS MISSION GOALS CUSTOMER NEEDS BUSINESSS MISSION GOALS CUSTOMER NEEDS RESULTS IN NEW PRODUCT REDESIGN (FOR EFFICIENCY & ALIGNMENT OF MUTUAL GOALS) RESULTS IN NEW PRODUCT REDESIGN (FOR EFFICIENCY & ALIGNMENT OF MUTUAL GOALS) STRUCTURED ORDERING OF WORKSTEPS MEASURED IMPROVED (OR) ELIMINATED STRUCTURED ORDERING OF WORKSTEPS MEASURED IMPROVED (OR) ELIMINATED

14 BPR - Methods LEAN SIX SIGMA TOTAL QUALITY MANAGEMENT (TQM) KAIZEN PLAN, DO, STUDY ACT (PDSA) CLINICAL MICROSYSTEM MODEL TALENT PROFILING

15 LEAN – What? RETHINKING & REDESIGN OF BUSINESS PROCESS SHORTENED LEAD TIMES REDUCED PROCESS WASTES IMPROVED CUSTOMER SATISFACTION EFFICIENCY IMPROVEMENTS PROCESS COST REDUCTION REVENUE INCREASE EFFICIENCY IMPROVEMENTS PROCESS COST REDUCTION REVENUE INCREASE

16 LEAN – How? HIGH LEVEL ASSESSMENT WHO ? PRODUCT DELIVERED ?

17 LEAN – How? STEPS THAT HAVE NO VALUE WAITING TIME PROCESS WASTE Improving Processes by eliminating…

18 LEAN – How? (Six Concepts) 1.Value 2.Value Stream 3.Flow 4.Pull 5.Perfection 6.Replication

19 LEAN – What helps? LEAN IMPLEMENTATIONS STRONG MANAGEMENT SUPPORT & SPONSORSHIP COMMUNICATION OF SHARED GOALS

20 LEAN - Conclusion Can be applied to any business process or service industry. Can be used to dramatically reduce lead times – HR recruitment – New product development – Customer development TO GAIN COMPETITIVE ADVANTAGE OVER OTHER COMPANIES

21 Six Sigma (Six sigma was invented by Motorola in the 1980s) Analytical approach to indentify the inefficiencies and inadequacies in the process and provide a step by step solution based on analysis of real time data. Process must have < 3.4 defects per million occurrences (Carrigan, 2006) Statistical calculation that suggests customer needs /satisfaction to meet % or 6-Sigma level. (Caldwell 2006) Focuses on customer satisfaction, process improvement and cost reduction. (Breyfogle, 2003) Uses structured methodology and powerful statistical tools that provide a scientific approach to process improvement and patient safety. (http://www.medscape.com)http://www.medscape.com)

22 Six Sigma Sub methodologies DMAIC: Define, Measure, Analyze, Improve, and Control; (improve existing processes ) DMADV: Define, Measure, Analyze, Design, Verify; (develop new processes or products at Six Sigma quality levels) (http://www.isixsigma.com/sixsigma/six_sigma.a sp)http://www.isixsigma.com/sixsigma/six_sigma.a sp Implementing 6sigma: “Black Belt” = organize of Six Sigma project “Green belt” = implement and monitor the project.

23 Applications of BPR BPR Obstacles 10/10/2014Group 4: Farabaugh, John, Katzovitz, Lott, Patki, Pearce, Snow23

24 What is TQM? Total Quality Management (TQM) is a philosophy that says uniform commitment to quality in all areas of an organization promotes an organizational culture that meets consumers' perceptions of quality. TQM philosophy focuses on teamwork, increasing customer satisfaction, and lowering costs. 10/10/2014Group 4: Farabaugh, John, Katzovitz, Lott, Patki, Pearce, Snow24 The concept of TQM rests largely on five principles: 1. Produce quality work the first time. 2. Focus on the customer. 3. Have a strategic approach to improvement. 4. Improve continuously. 5. Encourage mutual respect and teamwork.

25 TQM Process/Benefits Process begins by listening to customers' wants and needs and then delivering goods and services that fulfill these desires. 10/10/2014Group 4: Farabaugh, John, Katzovitz, Lott, Patki, Pearce, Snow25 An effective TQM program has numerous benefits: Financial benefits (lower costs, higher returns on sales and investment, and the ability to charge higher rather than competitive prices) Improved access to global markets Higher customer retention levels Less time required to develop new innovations Reputation as a quality firm An effective TQM program has numerous benefits: Financial benefits (lower costs, higher returns on sales and investment, and the ability to charge higher rather than competitive prices) Improved access to global markets Higher customer retention levels Less time required to develop new innovations Reputation as a quality firm

26 What is Kaizen? Philosophy/practices focusing on continuous improvement in manufacturing activities, business activities, & life in general. Refers to activities that continually improve all functions of a business, – Manufacturing to management – CEO to assembly line workers Kaizen aims to eliminate waste. 10/10/2014Group 4: Farabaugh, John, Katzovitz, Lott, Patki, Pearce, Snow26

27 Kaizen Cycle The cycle of kaizen activity can be defined as: Standardize an operation Measure the standardized operation Gauge measurements against requirements Innovate to meet requirements and increase productivity Standardize the new, improved operations Continue cycle ad infinitum 10/10/2014Group 4: Farabaugh, John, Katzovitz, Lott, Patki, Pearce, Snow27

28 Kaizen 10/10/2014Group 4: Farabaugh, John, Katzovitz, Lott, Patki, Pearce, Snow28 Elements Teamwork Personal discipline Improved morale Quality circles Suggestions for improvement Results Elimination of waste (muda) and incorporation of efficiency The kaizen five - S framework Seiri - tidiness Seiton - orderliness Seiso - cleanliness Seiketsu - standardized clean-up Shitsuke - discipline Standardization

29 Other BPR Methods PDSA – Plan, Do, Study, Act Clinical Microsystem Model Talent Profiling 10/10/201429Group 4: Farabaugh, John, Katzovitz, Lott, Patki, Pearce, Snow

30 PDSA – Plan, Do, Study, Act Three Questions What are we trying to accomplish? How will we know that a change is an improvement? What changes can we make that will result in improvement? 10/10/2014Group 4: Farabaugh, John, Katzovitz, Lott, Patki, Pearce, Snow30

31 The PDSA Cycle 10/10/2014Group 4: Farabaugh, John, Katzovitz, Lott, Patki, Pearce, Snow31

32 PDSA – UW Rheumatology Office Visit Data Collection Cycle 1 – Standardized Database & Dictation Template Cycle 2 – Disease Activity Scoring Cycle 3 – CPT Visit Coding Level Cycle 4 – Full Implementation 10/10/2014Group 4: Farabaugh, John, Katzovitz, Lott, Patki, Pearce, Snow32

33 PDSA – UW Rheumatology Office Visit Data Collection Improvements More Complete Data 40% Time Savings More Effective Patient/Physician Visit Improved Therapeutic Decision Making Research Study Revenue 10/10/2014Group 4: Farabaugh, John, Katzovitz, Lott, Patki, Pearce, Snow33

34 Clinical Microsystem Method Smallest Replicable Unit Building Blocks to Larger System 5 P’s - Purpose, Patients, Processes, Professionals, and Patterns Improvements – Transformation of Workforce and Culture Hospital Quality = Quality of Microsystem 1 + Quality of Microsystem 2 + Quality of Microsystem 3 and Microsystem (n) 10/10/2014Group 4: Farabaugh, John, Katzovitz, Lott, Patki, Pearce, Snow34

35 Talent Profiling Worker rather than Process Right Person – Right Job Important Characteristics to be Successful 10/10/2014Group 4: Farabaugh, John, Katzovitz, Lott, Patki, Pearce, Snow35

36 Business Process Reengineering and Health Care IT IT often plays a support role in BPR in health care “What has to happen when you design the new process, you find how information technology is going to be used to support that new process, and if you don’t have that technological capability, you’re going to have to go and get it.” (George W. Whetsell) 10/10/2014Group 4: Farabaugh, John, Katzovitz, Lott, Patki, Pearce, Snow36

37 Denver Health (Lean) Pure IT project: patient scheduling application development Project timeline reduced 50%, outside consulting cost reduced 36%. IS had previously sat “on the sidelines” in lean initiatives, but sought to use lean to make the department more efficient Challenge was to fit lean concepts to a longer term IT project. 10/10/2014Group 4: Farabaugh, John, Katzovitz, Lott, Patki, Pearce, Snow37

38 Denver Health (Lean) Rapid Improvement Event (RIE) model was tweaked to fit this specific project – Embedded into project cycle, redefining how project was managed – Custom templates created – Special attention given to lean tools, activity flow, and frequency of RIE events Involvement of end users “Red phone” mentality 10/10/2014Group 4: Farabaugh, John, Katzovitz, Lott, Patki, Pearce, Snow38

39 BayCare Health & Blue Cross Optimize Electronics Claims Processing – Understand Sub-processes in claims processing – Blackbelts held team meetings – Six page swim lane process map Results Reduced processing time Fewer denied claims $500,000 annual savings 10/10/2014Group 4: Farabaugh, John, Katzovitz, Lott, Patki, Pearce, Snow39

40 VA’s VistA QUERI system (TQM) Quality Improvement initiative within the VA, where data from the organization’s nationwide interoperable VistA EMR system is integral to the total process of improving patient outcomes. 10/10/2014Group 4: Farabaugh, John, Katzovitz, Lott, Patki, Pearce, Snow40

41 10/10/2014Group 4: Farabaugh, John, Katzovitz, Lott, Patki, Pearce, Snow41 Hynes, D. M., Perrin, R. A., Rappaport, S., Stevens, J. M., & Demakis, J. G. Informatics Resources to Support Health Care: Quality Improvement in the Veterans Health Administration. Journal of the American Medical Informatics Association. 2(5),

42 Virginia Mason (Lean) IT served as a support role to improve areas identified as cost-centers – Provided feedback to individual clinicians on cost performance – Implementation of CPOE to reduce unnecessary prescriptions and reduce ER visits due to low refill allowances – Implementation of decision support to alert clinicians when tests fall into the “not useful” category 10/10/2014Group 4: Farabaugh, John, Katzovitz, Lott, Patki, Pearce, Snow42

43 BPR Recap Methods – How different from traditional – Variety of methods Application 10/10/2014Group 4: Farabaugh, John, Katzovitz, Lott, Patki, Pearce, Snow43

44 Q&A Questions? 10/10/2014Group 4: Farabaugh, John, Katzovitz, Lott, Patki, Pearce, Snow44

45 Class Exercise 10/10/2014Group 4: Farabaugh, John, Katzovitz, Lott, Patki, Pearce, Snow45

46 Business Process Redesign: Jeopardy 10/10/2014Group 4: Farabaugh, John, Katzovitz, Lott, Patki, Pearce, Snow46 LeanSix-Sigma Total Quality Management (TQM) Kaizen Plan, Do, Study, Act (PDSA) 25 Points 50 Points 100 Points

47 Jeopardy Questions (Modified Version) 10/10/2014Group 4: Farabaugh, John, Katzovitz, Lott, Patki, Pearce, Snow47 LeanSix-Sigma Total Quality Management (TQM) Kaizen Plan, Do, Study, Act (PDSA) Name 1 of the 3 improvements that can be expected with ‘Lean’ The acronym “DMAIC” stands for what? What area of an organization does TQM focus its efforts? What is the aim of Kaizen? Name 1 of the 3 questions that should be asked before implementing PDSA Lean improves processes by eliminating what? (name 2 of the 3) What are the two types of “belts” that can be received if an org. implements six-sigma? The TQM process first begins by what? “Muda” stands for what? The “Do” stage of PDSA involves a number of duties, name 2. Lean can be applied to what business or industry? What organization invented the six- sigma methodology? Name 2 of the 5 benefits that can be expected with TQM? Name 2 of the 5 elements of Kaizen Name 2 elements involved with the “Act” cycle of PDSA?

48 Jeopardy Answers 10/10/2014Group 4: Farabaugh, John, Katzovitz, Lott, Patki, Pearce, Snow48 LeanSix-Sigma Total Quality Management (TQM) Kaizen Plan, Do, Study, Act (PDSA) 1.Shortened lead times 2.Reduction in process waste 3.Improved customer satisfaction DMAIC = Define, Measure, Analyze, Improve, and Control All areas of an organization Eliminate waste 1.What are we trying to accomplish? 2.How will we know that change is an improvement? 3.What changes can we make that will be an improvement? 1.Steps that have no value 2.Process waste 3.Waiting time Black Belt and Green Belt Listening to customers’ wants and needs Elimination of waste and incorporation of efficiency 1.Carry out the plan 2.Document observations 3.Record Data Any process or industry! Motorola 1.Financial Benefits 2.Improved access 3.High customer retention 4.Less time for R&D 5.Improved Reputation 1.Teamwork 2.Personal discipline 3.Improved morale 4.Quality circles 5.Suggestions for improvement 1.Asking “what changes are to be made?” 2.Asking “what is the next cycle?”

49 Bibliography Alexandrou, Marios (2009). Methodologies. Retrieved from Beck, K., Beedle M., Bennekum, A., et al. (2001), The Agile Manifesto. Retrieved from Caldwell, C., Lean-Six Sigma tools for rapid cycle cost reduction, Healthcare Financial Management. Oct 2006, 60 (10) CliffsNotes.com. Total Quality Management (TQM). 24 Nov Retrieved from Corn, J. B., Six Sigma in Health Care, Radiologic Technology. September/October 2009; 81(1): Bergman, R. (1994). Reengineering Healthcare. Hospitals & Health Networks. 5 February, 1994, Breyfogle, F. W., Implementing Six Sigma: Smarter Solutions Using Statistical Methods, 2nd ed. 2003, Wiley, New York, NY. Carrigan M. D., Kujawa D. Six Sigma in health care management and strategy. Health Care Management. 2006;25(2): Caldwell, C., Lean-Six Sigma tools for rapid cycle cost reduction, Healthcare Financial Management. Oct 2006, 60 (10) Davenport, D. and Short, J. The New Industrial Engineering: Information Technology and Business Process Redesign. Retrieved from Guha, S., Kettinger, W., & Teng, T. (1993) “Business Process Reengineering: Building a Comprehensive Methodology”, Information Systems Management, Summer 1993, Vol 10 (3), 13-22

50 Harrington, T. J., Newman, E. D. (2007). Redesigning the care of rheumatic diseases at the practice and system levels. Clinical and Experimental Rheumatology, 25, S55-S63. Improvement Methods. Institute of Healthcare Management. Retrieved from Lanham, B., Maxson-Cooper, P. Is Six Sigma the Answer for Nursing to Reduce Medical Errors...: Implementing Six Sigma in Health Care. MedScape Today. Retrieved from Mahalik, P. Learning to Think Lean: Six Steps with Review Points. Retrieved from McQueen, H. E. (1993). The healthcare CIO’s role in business process redesign. Computers in Healthcare. February, 1993, Mohr, J, Batalden, P., Barach, P. (2004). Intergrating patient safety into the clinical microsystem. Qual Saf Health Care, 13, Plan-Do-Study-Act (PDSA) Cycle (2008). AHRQ Healthcare Innovations Exchange. Retrieved from Schweikhart S. A., Dembe A. E. J Investigative Medicine Sep 2 Shaffer, Vi. (2008). Case Study: Denver Health Leverages ‘Lean’ for a Breakthrough in Enterprise Patient Scheduling Implementation. Gartner Industry Research. 17 December, Six Sigma. Retrieved from Six Sigma - What is Six Sigma? Retrieved from ValueBasedManagement.com. Kaizen Philosophy and Kaizen Method. Retrieved from:


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