1. Existing Commitments Surgical Improvement Project Team 5 Meeting Lisa Brandenburg, C.O.O. Ed Walker, M.D., Medical Director May 3, 2005

2. 2 UWMC Strategic Planning UWMC’s program planning over the last 4-5 years has focused on promoting growth of the services lines Therefore, existing UWMC commitments relate largely to supporting the growth & development of the service lines

3. 3 UWMC Strategic Planning Examples – commitments to support the growth in Transplant, Regional Heart Center (includes CV Surgery), Orthopedics through recruitment of new surgeons, Oncology, Oto & Neurosurgery through the recruitment of new surgeons

4. 4 Current Service Lines at UWMC Cardiovascular (UWRHC) Oncology - includes the SCCA Orthopaedics and Sports Medicine Organ Failure and Transplant Otolaryngology Neurosurgery Criteria: High-volume and/or High-charge Services; Program Profitability; Program Readiness

5. 5 UWMC Departments SERVICE LINES CANCER PATIENT CARDIAC PATIENT Operating RoomShort Stay UnitsRadiologyInpatient Units Lab/Path Services Data tracking Business systems External market information Outpatient Clinics

6. 6 Structure of Service Lines at UWMC Organizational Priority  Service lines heart of Quality Improvement activities  Structure used as collaborative physician and Medical Center vehicle to manage growth Service Line Administrator and Physician Partner Committee Structure; Team Membership  Strives for multidisciplinary representation along the continuum  Works together to develop annual goals and implement strategies  Designated support resources (CDS, Q1, etc.)

7. 7 Are All Hospitals Growing?

8. 8

9. 9 Is All Growth Good for the Bottom Line? Profitability data isn’t perfect at the encounter level: Reimbursement is estimated based on actual payments and spread across like populations. Direct costs are allocated based on gross charges in specific areas. Indirect costs are allocated based on gross charges and are spread according to assumed utilization. The costs of the finance department are spread across all encounters. Department support for a program such as Oncology is spread across all oncology encounters. All of these graphs on the following slides generally need about 100 footnotes each.

10. 10 Service Lines/Areas – Per Patient Day unprofitable/large unprofitable/small profitable/large profitable/small Service lines and areas are defined by APR-DRGs, DRGs and departments and reflect IP and OP operations. Encounter assignment is hierarchical beginning with service lines and then by service areas. As such, General Medicine and Surgery exclude encounters that are assigned to Oncology, Transplant, Heart Center, Ortho and Oto. Why Support Service Line Growth?

11. 11 Essential Services profitable/large profitable/small unprofitable/large unprofitable/small

12. 12 Payor Profitability – IP and OP

13. 13 Payor Profitability – IP

14. 14 Payor Profitability – OP

15. 15 Implementation Issues Transplant – how do you accommodate urgent/emergent cases, how do you support 2 rooms at the same time Cardiac Surgery – same issue w/ urgent/emergent cases Ortho – how do you support standardization while bringing in new faculty All surgical services – how do we plan for time in the OR for new surgeons when they may not have full case loads to start

16. 16 What have we learned? Can’t predict every issue that will surface as we try to grow various programs, but we could do better New business planning process developed by UWMC Finance will seek to evaluate impact on related services such as Anesthesia, Radiology, Pathology, Lab, etc. and related departments

17. 17