Physicians get “Lean” for Efficient Services

Valuations-ChannelModern physicians, especially owners of urgent care centers and ambulatory surgery centers should always be on the lookout for systems that can help them both save money and improve the quality of patient care. One of the methods that has taken root in the medical industry over the recent years is modeled after the Lean system of manufacturing. What is this system? How can it help your centers run efficiently, while improving your customer’s experience and care? Professionals adept in the system of Lean healthcare speak with The Ambulatory M&A Advisor and answer these important questions about “Leaning” healthcare delivery.

Jeffery Liker, professor of industrial and operations engineering at the University of Michigan says the the process of manufacturing-based delivery, or, the Lean process, is summarized by Toyota’s two pillars of the Toyota way, continuous improvement and respect for people.

Liker says that continuous improvement starts with having a clear focus on the challenges you currently face.  Some examples of challenges in the healthcare industry could be maintaining profit while per patient revenue declines, serving more patients without adding staff or equipment, etc.

According to Liker, the second part of continuous improvement is Kaizen.  Kaizen is a systematic, scientific process of improving towards that challenge, Liker says.

Kaizen is a creative process in experimenting with different possible, better ways, until you beat your challenge,” he says.

The third principle is to examine, first-hand, the actual process. Liker says “Lean folks” call this the “gemba,” the place where the actual work is done.

“For example, you are going to improve the radiology department, you go right to the radiology department to observe them.  You’re like a fly on the wall observing what exactly happens.  It’s almost comical watching the actual process because so much of what happens has nothing to do with value added work,” Liker says.

Liker explains that one of the key ideas with the Lean system is to maximize value added work which is the work that the patient cares about.  Liker says that examples of value added work to patients include: being examined, being tested, getting the diagnosis, being treated, getting instructions on their follow-up treatment and what they need to do at home.

That’s all adding value to the patient.  Sitting and waiting in a waiting room, examination room or waiting for the doctor to show up, waiting online to get your prescription…all of those things would be waste from the patient’s point of view,” Liker says.

Dr. Darlene Dumont, DBA, Director of Learning at Lean Enterprise Institute explains that Lean healthcare puts the patient at the center of everything.

“Lean is all about focusing on the customer, in this case, the patient.  We concentrate on what is value-added to patients while removing nonvalue-added activities from processes using the Lean as a continuous improvement methodology. We focus on processes by involving people who are doing the work to solve problems,” says Dumont, who has worked at hospitals and healthcare organizations implementing Lean management systems.  She says engaging people is one of the most important pieces of the puzzle when introducing Lean to your center.

“Solutions are going to come from people who are closest to the work,” Dumont says.  “So you need to engage people at the front lines of the center. The leader’s role becomes one of supporting, coaching and mentoring them as problem solvers. Broken processes are often the cause of problems, frustration and related behaviors.”

She adds that Lean teaches users to ficus on fixing the broken problem rather than blaming others for it.  For example, she says, from the critical perspective of patient flow, perfecting processes that people encounter when they enter the center is equally important as the remainder of the work to be done through discharge.  This means lenders and the front line people have to work together to understand what is working and not working; what activities add value and which ones do not.

Dumont says that eliminating nonvalue-added activities creates an excellent environment for center patients and employees.

“Not only are we going to be making patients safer, but they will potentially have shorter lead times, meaning they will flow through the center more efficiently and with higher quality service.  That has a ripple effect of producing higher reimbursement rates, so that money can be invested in further improvements to patient care,” Dumont says.

When it comes to employee satisfaction, Dumont says that as processes are improved, work becomes easier and more rewarding for employees because they are able to spend more time with patients.

Brian Hayden, president, Xpress Wellness Urgent Care says that although his six centers do not practice Lean or manufactured delivery as a whole, he says he follows methods to try to get a handle on all of the components of running a center efficiently, with as little excess as possible.

“We have limited control over the volume that walks through the door.  What we do have control over is the expense side of the equation.  We use an Urgent Care specific EMR system…it has a dashboard that gives you in the moment statistics of wait times, volumes, and things like that,” Hayden explains.

He adds that the system also has built in analytical tools that allow him to run reports, examine completed claims and understand his reimbursements on the various carriers.

“That helps me from the standpoint of negotiating contracts.  It also allows me to look at my providers’ performance across several key indicators. It helps us look at the norms and focus on the outliers,” Hayden says.

Hayden says he also focuses on pricing of expenses that his business has control over.

“Each of our clinics has office managers that place orders. The price difference on various brands of the same item can add up to being significant over time.  As an example, disinfecting wipes,” Hayden says.  “One office manager may be buying a certain brand and one may be buying another brand.  There is a huge price difference, maybe four or five dollars per case.  What we are able to do is, we’ve built formularies so that if a manager were to order disinfecting wipes, this is the disinfecting wipes that they can select from.”

Hayden says the analytic tools his centers utilizes have helped his centers focus on the portions of the business regarding claims, communication, length of visit, reimbursement rates, monitoring performance within clinics and key indicators as to average wait time.

For more information on implementing a Lean program in your center visit or


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