IOM re­port says bet­ter use of tech­nol­ogy and other tools can save $750 bil­lion in health­care spend­ing and save 75,000 lives each year

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The tools re­quired to re­make the be­lea­guered U.S. health­care sys­tem into one that’s safe, cost­ef­fec­tive and pa­tient-cen­tered are avail­able right now. So said the In­sti­tute of Medicine in a 382-page, catchall re­port that pro­vided a com­pre­hen­sive road map for such trans­for­ma­tion.

Au­thored by an 18-mem­ber ex­pert com­mit­tee that in­cluded He­len Dar­ling, pres­i­dent of the Wash­ing­ton-based Na­tional Busi­ness Group on Health, and Dr. Gary Ka­plan, chair­man and CEO of Vir­ginia Ma­son Health Sys­tem, Seattle, the Sept. 6 re­port stressed the need to lever­age in­for­ma­tion tech­nol­ogy in­fra­struc­ture, man­age­ment sci­ence, team­work and other strate­gies to bol­ster im­prove­ment ef­forts.

“Missed op­por­tu­ni­ties for bet­ter health­care have real hu­man and eco­nomic im­pacts,” the com­mit­tee said in the re­port. “If the care in ev­ery state were of the qual­ity de­liv­ered by the high­est-per­form­ing state, an es­ti­mated 75,000 fewer deaths would have oc­curred across the coun­try in 2005. Cur­rent waste di­verts re­sources from pro­duc­tive use, re­sult­ing in an es­ti­mated $750 bil­lion loss in 2009.”

The re­port, Best Care at Lower Cost: The Path to Con­tin­u­ously Learn­ing Health Care in

Amer­ica, comes more than a decade af­ter the re­lease of To Err is Hu­man and Cross­ing the

Qual­ity Chasm, com­pan­ion re­ports from the IOM that many say marked a wa­ter­shed mo­ment in the qual­ity and safety move­ment.

But in the years since those two re­ports were re­leased, costs have bal­looned, rates of pre­ventable harm have re­mained high, and ra­cial, eth­nic and ge­o­graphic dis­par­i­ties have per­sisted.

“Med­i­cal care is grow­ing more and more com­plex each day, and the amount of avail­able data and ev­i­dence is grow­ing, too,” said Dr. Mark Smith, pres­i­dent and CEO of the Oak­land-based Cal­i­for­nia Health­Care Foun­da­tion and chair­man of the com­mit­tee that pro­duced the re­port. “But that kind of com­plex­ity— both bio­med­i­cal and or­ga­ni­za­tional—is just not com­pat­i­ble with our cur­rent sys­tem. Our whole ethos is rooted on an ob­so­lete un­der­stand­ing of what we can and need to do.”

Just last month, re­searchers from Johns Hop­kins Univer­sity’s Arm­strong In­sti­tute for Pa­tient Safety and Qual­ity re­leased a study con­clud­ing that more than 40,000 in­ten­sive­care pa­tients die each year with an un­di­ag­nosed con­di­tion that might have caused or con­trib­uted to their deaths. An­other study, pub­lished in the Septem­ber is­sue of the Jour­nal of the Amer­i­can Col­lege of Sur­geons, found that 11.3% of gen­eral surgery pa­tients were read­mit­ted within 30 days of dis­charge.

Mov­ing the nee­dle has proved dif­fi­cult, Smith said, be­cause of a host of ob­sta­cles, in­clud­ing un­even use of avail­able ev­i­dence, poor com­mu­ni­ca­tion among clin­i­cians and pa­tients, and a

lack of fi­nan­cial in­cen­tives for good care.

“New pay­ment mod­els are cru­cial,” Smith said. “In health­care, peo­ple are ba­si­cally paid to ad­mit peo­ple, to do pro­ce­dures and to have of­fice vis­its. We have to get to a sys­tem where pay­ment is based on value and not the num­ber of times the turn­stile is turned.”

Those poorly aligned in­cen­tives pre­vent most CEOs from im­ple­ment­ing proven im­prove­ment strate­gies, ac­cord­ing to Dr. Brent James, chief qual­ity of­fi­cer at In­ter­moun­tain Health­care, Salt Lake City, who also served on the IOM com­mit­tee. “In most cases, you’ll be fi­nan­cially pun­ished,” James said. In­ter­moun­tain lost $9 mil­lion in rev­enue, for in­stance, af­ter a highly suc­cess­ful ini­tia­tive to curb early elec­tive de­liv­er­ies be­fore 39 weeks. “You need to align pay­ment to see this sys­tem tran­si­tion.”

To give some per­spec­tive, the com­mit­tee con­trasted health­care with other con­sumeror­i­ented in­dus­tries. If those in­dus­tries op­er­ated like the health­care sys­tem, the com­mit­tee said in the re­port, air­line pi­lots would de­sign their own pre-flight safety checks and gro­cery stores wouldn’t post their prices.

“If bank­ing were like health­care, au­to­mated teller ma­chine (ATM) transactions would take not sec­onds but per­haps days or even longer as a re­sult of un­avail­able or mis­placed records,” ac­cord­ing to the re­port. “If home build­ing were like health­care, car­pen­ters, elec­tri­cians and plumbers would work with dif­fer­ent blue­prints, with very lit­tle co­or­di­na­tion.”

But Smith said the com­mit­tee’s frame­work for “a learn­ing health­care sys­tem,” de­vel­oped dur­ing the past year and half, can change that.

One com­po­nent em­pha­sized re­peat­edly throughout the re­port is the im­por­tance of sys­tems engi­neer­ing and other man­age­ment strate­gies for redesign­ing flawed pro­cesses. Those can be as sim­ple as a short check­list, or more com­plex ap­proaches—of­ten bor­rowed from other in­dus­tries—such as Lean and Six Sigma.

Such process im­prove­ments can make mea­sur­able ef­fects on qual­ity and can also re­sult in sig­nif­i­cant sav­ings, said Eu­gene Lit­vak, pres­i­dent and CEO of the In­sti­tute for Health­care Op­ti­miza­tion, New­ton, Mass., and a mem­ber of the IOM com­mit­tee.

The In­sti­tute for Health­care Op­ti­miza­tion, which spe­cial­izes in op­er­a­tions man­age­ment— specif­i­cally smooth­ing pa­tient flow—has worked with a long list of well-known health­care or­ga­ni­za­tions, in­clud­ing Johns Hop­kins Medicine, Bal­ti­more, and the Mayo Clinic’s satel­lite in Jacksonville, Fla.

Lit­vak ar­gues that it’s the peaks and val­leys in bed oc­cu­pancy that con­trib­ute to a host of prob­lems, in­clud­ing high read­mis­sion rates, in­creased risk of mor­tal­ity and nurse burnout. And de­spite av­er­age bed oc­cu­pancy rates that hover around 65%, hos­pi­tals are plagued by over­crowded emer­gency de­part­ments and re­lated prob­lems like pre­ma­ture dis­charge, he said.

“We are one-third idle and we’re over­crowded,” Lit­vak said. “Only in health­care could you man­age that. We should have enough beds for ev­ery­one if we use them prop­erly.”

One of the tac­tics Lit­vak and his col­leagues of­ten use is smooth­ing out elec­tive surgery sched­ules so pro­ce­dures are not clus­tered on cer­tain days of the week. Not sur­pris­ingly, that strat­egy has been met with plenty of push­back, he said. But it’s also pro­duced re­sults.

At Cincin­nati Chil­dren’s Hospi­tal Med­i­cal Cen­ter, for in­stance, they were able to in­crease bed oc­cu­pancy rates to 91% from 76%. Ad­di­tion­ally, the hospi­tal saw $100 mil­lion in avoided cap­i­tal costs and an­other $100 mil­lion in ad­di­tional rev­enue fol­low­ing im­ple­men­ta­tion of the in­sti­tute’s rec­om­men­da­tions.

“I think it’s very im­por­tant for pa­tients to know that when they sit for hours in the emer­gency room, it’s not be­cause ev­ery­one got sick at once,” Lit­vak added. “It’s not a short­age of beds; it’s a short­age of knowl­edge and lead­er­ship.”

See COVER STORY on p. 14

He pre­dicted a sea change in the use of process im­prove­ment strate­gies, pro­pelled by new pay­ment mod­els that em­pha­size value. Ac­count­able care or­ga­ni­za­tions, in par­tic­u­lar, he said, will drive or­ga­ni­za­tions to look more closely at how their sys­tems can be ad­justed to make care bet­ter.

Health IT, in­ter­op­er­abil­ity and real-time ac­cess to data are also crit­i­cal el­e­ments of a high-per­form­ing health­care sys­tem, the com­mit­tee said. “Once in place, these sys­tems cre­ate the po­ten­tial for ad­vanced uses of clin­i­cal data to im­prove out­comes,” they said in the re­port. “For in­stance, they al­low providers to an­a­lyze their pa­tient pop­u­la­tions and iden­tify those who may ben­e­fit from pre­ven­tive care or other proac­tive clin­i­cal ser­vices.”

Af­ter years spent lag­ging far be­hind other in­dus­tries when it comes to adoption of IT sys­tems, the stars are be­gin­ning to align, said Dr. Paul Tang, vice pres­i­dent and chief in­no­va­tion and tech­nol­ogy of­fi­cer at the Palo Alto (Calif.) Med­i­cal Foun­da­tion.

HHS’ Na­tional Qual­ity Strat­egy and its Part­ner­ship for Pa­tients ini­tia­tive both ex­plic­itly call for in­creased use of health IT, said Tang, who was also a mem­ber of the IOM com­mit­tee that pro­duced the re­port. Even more sig­nif­i­cant, he says, has been the con­sid­er­able uptick in adoption since the be­gin­ning of the fed­eral gov­ern­ment’s EHR in­cen­tive pro­grams.

“To Err is Hu­man made vis­i­ble the tremen­dous prob­lem we had with med­i­cal er­rors, but back then very few sys­tems had this kind of data in­fra­struc­ture,” Tang said. “We’re in a much dif­fer­ent spot now.”

Like the Pa­tient Care Pro­gram, a $500 mil­lion ini­tia­tive launched Aug. 28 by the Gor­don and Betty Moore Foun­da­tion (Sept. 3, p. 6), this lat­est IOM re­port places a great deal of em­pha­sis on pa­tient and fam­ily en­gage­ment and the need to in­clude them in team-based strate­gies with clin­i­cians.

Arthur Levin, di­rec­tor of the New York-based Cen­ter for Med­i­cal Con­sumers, served on the com­mit­tee that pro­duced To Err is Hu­man and

Cross­ing the Qual­ity Chasm, as well as on the com­mit­tee that au­thored this lat­est re­port.

“There’s no one place that’s do­ing ev­ery­thing right, but we do know what works. There are suc­cesses out there that tell us it can be done.” —Arthur Levin, di­rec­tor of the New York-based

Cen­ter for Med­i­cal Con­sumers

The new re­port is dif­fer­ent from pre­vi­ous ones, he said, be­cause it brings to­gether a range of dis­parate el­e­ments that have been shown to be suc­cess­ful and it puts them in one frame­work.

“There’s no one place that’s do­ing ev­ery­thing right,” Levin said. “But we do know what works. There are suc­cesses out there that tell us it can be done.”

He said that un­der­stand­ing of pa­tient en­gage­ment has evolved dur­ing re­cent years to in­clude learn­ing from pa­tients and their fam­i­lies and pro­vid­ing them with the elec­tronic tools they can use to help man­age their own care. “That’s some­thing that was not widely ac­cepted be­fore,” Levin said.

In the re­port, the com­mit­tee ar­gued that pa­tients need bet­ter in­for­ma­tion about the ben­e­fits and risks as­so­ci­ated with treat­ments, ad­e­quate in­struc­tions dur­ing thorny tran­si­tions of care, and care plans that take their goals and pref­er­ences into ac­count.

In­volve­ment by pa­tients and fam­i­lies has been linked to re­duced pain, im­proved health out­comes and lower uti­liza­tion of ser­vices, they said. And the stakes for en­gag­ing pa­tients are grow­ing with the CMS’ in­clu­sion of pa­tient-ex­pe­ri­ence met­rics in its hospi­tal value-based pur­chas­ing pro­gram.

Pa­tients and their fam­i­lies also can be a valu­able as­set in hospi­tal im­prove­ment ini­tia­tives, the com­mit­tee con­tended.

“Case stud­ies have shown that by work­ing on such coun­cils, pa­tients may par­tic­i­pate in in­sti­tu­tional qual­ity im­prove­ment projects, help re­design ser­vice de­liv­ery pro­cesses, serve on search com­mit­tees for new ex­ec­u­tives, and help de­velop ed­u­ca­tional pro­grams for hospi­tal staff,” they said in the re­port. “They also may aid the hospi­tal in mak­ing its pro­ce­dures more ef­fi­cient and pa­tient-cen­tered and may par­tic­i­pate in rounds, which can lead to new sug­ges­tions for im­prove­ment.”

The slew of changes ad­vo­cated in the re­port—in­creased use of health IT, se­cure in­for­ma­tion ex­change, point-of-care de­ci­sion sup­port, pa­tient en­gage­ment, cul­ture change, sys­tems re-engi­neer­ing—can seem daunt­ing, but the gen­eral tone of the re­port is op­ti­mistic, Smith said.

“There’s such a hunger by other or­ga­ni­za­tions to learn about what the best ones have achieved,” he said, adding that lead­ing sys­tems like Den­ver Health have had to set up tour op­er­a­tions to ac­com­mo­date vis­i­tors. “That’s pro­foundly en­cour­ag­ing.” TAKE­AWAY: Health­care ex­ec­u­tives need to re­view and then op­ti­mize their or­ga­ni­za­tions’ own in­ter­nal sys­tems to bet­ter con­trol costs and im­prove the qual­ity and safety of care.


Dr. Mark Smith, far left, chaired the IOM com­mit­tee that pro­duced the re­port. The cur­rent sys­tem isn’t com­pat­i­ble with the grow­ing com­plex­ity of health­care, he said. He is shown at a news briefing last week on the re­port’s re­lease.

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