The cost of delivering healthcare in the US varies dramatically, and not just across different markets or systems. As healthcare leaders strive to improve outcomes and costs, diagnostics and interventions have frequently been their focus from a care pathway perspective. However, the high variability of implant and device utilization also offers significant opportunity.
Faced with the ongoing shift to value-based care, hospital executives are recognizing that inappropriate clinical variation inevitably results in low-quality and high-cost outliers. They’re responding by launching standardization initiatives. In fact, a recent Vizient survey listed reducing clinical variation as the number-one priority for C-suite respondents in 2017.
Focus on High-Impact Areas
It’s important to focus on a few specific high-spend, high-variability areas, to give care variation initiatives the best chance for success. For example, a recent study in Orthopaedic Journal of Sports Medicine identified rotator cuff repairs as one of those areas. The study found a wide variation in total supply cost per case for rotator cuff repair at a single hospital, with the most expensive repair coming in nearly 12 times higher than the least expensive.
It’s this type of focus that leads to measurable results. A study published in JAMA Internal Medicine describes the success of one hospital’s targeted standardization initiative in response to a total joint bundled payment program. By introducing a capped pricing program, the organization decreased implant and supply costs by 34% while improving clinical outcomes.
Find Your Starting Point
Where do you start? The challenges with implant and supply utilization are complex. At Lumere, we recommend:
- Categorizing spend into clinically equivalent groups
- Identifying outliers within specific types of procedures
- Comparing outliers’ performance to their peers backed by relevant clinical evidence
- Agreeing to guidelines for use based on evidence and hardwiring to protocols
- Tracking decisions to actual performance monthly and sharing with decision makers and impacted physicians for course correction
We know clinical categorization and evidenced-based comparisons are not simple tasks, and they rely on interlinking multiple data systems. If you’re an executive worried about reducing clinical variation for 2017, you will need the right combination of data, technology and clinical evidence to drive your efforts.