Real World Rescue

Could Improving Hospital Efficiency Solve the Healthcare Crisis?

Wednesday, February 10th, 2010

No issue looms larger in the US today than healthcare reform. Costs are rising at an enormous rate, so plenty of people are completely without insurance. Most of the personal bankruptcies filed in this country come from people who have been hit with a catastrophic illness and subsequently could not pay their medical bills. Some of these people had insurance, too.

We all know that inefficiency leads to high costs, which begs the question;
“Could we solve the crisis by improving efficiency?” Well, it seems the answer is yes…….and no.

Inefficiency and lack of cooperation between hospitals is a big problem. The largest expenditures hospitals make are on up and coming technology. Over time, this technology may save money, because it may shorten the time to reach a diagnosis or it may make treatments easier. But, in the short run, it costs lots of money. And, in an effort to make money, every hospital wants every new piece of equipment – we’re paying for that in increased fees for procedures.

If hospitals were more cooperative and developed niche markets for themselves, costs would be lowered. A major city likely has three or four major hospitals. If these hospitals agreed for each of them to focus new technology only in selected areas, all could save money. And, all could retain patients, too. Any lost by not having the newest equipment in one area would be regained by having the best equipment in another.

There are easy efficiency fixes that could save millions in other areas, too. Going paperless is a big one. Hospitals that use electronic charting and electronic prescription order entry save big. They reduce the amount of paper they buy and the amount of chart and paper storage they need. They also reduce the amount of garbage they generate. They save time by making reading and updating charts, along with writing prescriptions faster and easier for doctors and nurses. This allows the staff to attend to more patients in a day.

But the biggest win in going paperless is the huge reduction in the number of patient errors. No longer are people required to interpret someone’s handwriting, which can lead to many errors. Patient errors cause medical complications, longer hospital stays and more hospital readmissions. They also cause malpractice suits. All of these things are extremely costly for hospitals – and of course, very bad for patients, too.

Now, I don’t mean to imply that more efficient hospitals could completely solve the healthcare crisis. We also have a fundamental problem with managed care insurance, in that it allows doctors and hospitals to charge exorbitant amounts for procedures, because, after all, it’s just insurance that’s paying, not the patient. While efficiency and cost savings at the hospital level could help reduce the need to charge such high fees, a total restructuring of how insurance works is required to solve the crisis.

We still have a long way to go to solve our healthcare crisis. But, one thing’s certain. If hospitals want to be competitive as things change, implementing some of these efficiency measures can help them survive the coming storms.

Mary E. Ward writes about how to get an mha online.

Tags: Catastrophic Illness, Cooperation, Diagnosis, Doctors And Nurses, Electronic Prescription, Expenditures, Garbage, Going Paperless, Healthcare Crisis, Healthcare Reform, Hospital Efficiency, Hospitals, Inefficiency, Lots Of Money, Medical Bills, New Technology, Niche Markets, Paper Storage, Personal Bankruptcies, Prescriptions
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