from David Burdanews editor and columnist, 4sight Health
Twitter: @davidrburda
Twitter: @ 4sighthealth_

Years ago, in a publishing galaxy far, far away, the healthcare publication I worked for as a reporter required that each news item be read four times. Each story received four “readings”, as we said. The news editor did the first reading, two editors did the second and third readings, and the head of the copying office did the fourth. Only then could the news appear in print. (As I said, it was a long time ago.)

At each step, the story got worse, as the next reading complicated the mistakes made and the issues raised by the previous reading – all of which the reporter had to correct and answer. In many cases, a story will spin full circle and be close to the original version that entered the editing chain. The story will remain almost unchanged in the publication after surviving many attempts to destroy it.

I later learned that the editor of the publication, in violation of company policy, pays overtime to the participating editors on a salary for all the extra time they spend editing news stories. So not only did the versions of the story get worse, but the process added time and production costs. Think of it as our version of medicine for a service fee.

The ridiculous system finally fell apart after one of the copy editors complained to human resources that his check-in under the overtime table was late – a check that HR doesn’t know exists. The next thing you know, every news article got two readings instead of four, the number of mistakes made in news stories dropped, and no one worked late answering stupid questions. Think of this as our version of value-based recovery.

The above retrospective of journalism was prompted by MedPAC’s annual March report to Congress. I finally had time to walk through the 604-page MedPAC report, which you can download here.

On page 98 of the report, there is a compelling chart that compares the performance of “relatively efficient” hospitals with “other” hospitals that are probably not “relatively efficient”. As it turns out, efficiency – like the redesigned editing process in my old post – is associated with better results.

MedPAC identified “relatively efficient” hospitals as those that met the following four criteria in each of the previous three years:

  • Risk-adjusted mortality rates are among the top two-thirds of all hospitals
  • Their risk-adjusted readmission rates were among the top two-thirds of all hospitals
  • Their standardized hospital costs are among the top two-thirds of all hospitals
  • Their risk-adjusted mortality or standardized stay costs are among the top one-third of all hospitals

MedPAC found 292 of them and compared their performance with 1,598 other hospitals. In 2020, these 292 relatively efficient hospitals will enjoy the following compared to other hospitals:

  • Lower mortality rates
  • Lower readmission rate
  • Lower standardized costs for Medicare per stay
  • Higher levels of patient satisfaction
  • Higher Medicare profit margins
  • Higher profit margins for all payers

I know I know. Correlation is not a causal relationship. The 292 relatively efficient hospitals may not perform better because they are effective. Or to be effective no reason lead to better results from clinical, financial and patient experience. But it definitely looks that way, doesn’t it? Just as it was no coincidence, the quality of our news improved as our copy editing process became more efficient.

When the payment is fixed, you come up with a better way to do something. This is as true in healthcare as it is in any other business.

Thanks for reading.

This article was originally published on 4sight Health and is republished here with permission.

When Being More Efficient Produces Better Outcomes

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