Hospital Outsourcing-broad criteria for decision making

A hospital administrator always faces questions on services outsourcing in a hospital. It is difficult to take the decision as there is no common rule or criteria to identify what to outsource and what not. Currently most common prevailing practices are followed and these are driven by financial concerns. Other important factors come into picture once the service gets outsourced. At that time, it has its own challenges to revisit the decision. for eg. for a hospital decides to outsource pharmacy services on the basis of desired outcome of keeping no stock hence no capex & manpower.  But as a super-speciality hospital it’s running a medical oncology department where most chemotherapy drugs are required. In such case it’s important to maintain a control on stock, look at financial viability for hospital as well as patient and overall patient satisfaction. this can be better achieved if pharmacy is in-house.

There can be multiple criteria to consider while identifying such areas for outsourcing. There is nothing better then mother nature to provide the approach. Let’s consider a very simple colony of honey-bees. Honey bees have well defined system based upon the task to accomplish that ensures survival of the colony i.e. purpose. Members work in groups to fulfil needs of the colony. If we consider Queen as focused and result oriented leader then other members i.e. worker bees and drones are the groups to whom specialized work gets allocated by the leader in a very systemic way. Thousands of Worker Bees assume responsibility for feeding; cleaning, nursing, defending & Drones assume responsibility of mating with queen for colony growth. The distribution of tasks is on the basis of its characteristics. These characterises can be decoded and can be consider as criteria for outsourcing decision making.

Hospital Outsourcing concept

Goal- It’s very important to identify the Goals of the hospital which gives the clarity about the short & long term achievements.  Eg. For the hospital low cost treatment as one of the goal, leaders should isolate all the areas that lead to reduction in the cost thus impacts on the service delivery pricing. These areas can be non-clinical services, consumables or pharmaceutical products. If hospital has a goal to provide high end diagnostic service then all the areas like MRI, CT, and medical equipment procurement should be considered.

Critical Services– it’s important to identify criticality of the area considered for outsourcing. These critical services may be super-speciality associated services as defined by a hospital. Ideally such services are the differentiating factor for a hospital & should be in-house. For a level 1 trauma centre, ambulance service is critical and should be in hospital control. The delivery of such services will directly impact the patient care and satisfaction.

Value of services– in case of bees, drone is important for specific time period but doesn’t add value to other tasks done by worker bees. In a healthcare organization, support services like housekeeping or parking are important services but not a major value addition services to hospital mission. Some services are for specific time periods but are important and can impact operations any time. Equipment maintenance is one such example. Hospital has to keep a team in house or can outsource the maintenance. Up-keeping is the important activity and assurance to minimize sudden downtime.

Future plans– Drone bees are only useful as future assurance.  In the same way Organizations should identify the future plans. It’s important to understand whether they wanted to focus only on the hospital(s) core services or wanted to develop some services as separate business units. To develop separate business units organization should develop the expertise and develop them with in-house. These areas can be clinical areas like dialysis or imaging service and non-clinical as F&B department, Patient Care Services.

Operational Risk– bee colony is limiting their risk of ‘not having their offspring’ by sheltering a group of drones. Operational risk including cost, process, quality impact is the important component to consider while outsourcing. It’s better to have options to fall upon. Eg. IT infrastructure maintenance can be handled by an in-house team but because of the nature of issues and dependency, it’s a good idea to keep a highly skilled team as backup and outsource few selective activities like IT hardware maintenance.

Setup Complexity– in a colony of bees setting up the honeycomb, prepare food, taking care etc. tasks are taken care by the worker bees this is same as complexity linked with initial setup.  In hospital it’s important to identify these complexities like initial cost, operational challenges in setting up the services etc. for example it’s very important to check the setup cost for rehabilitation dept. with operational challenges as its different from focus areas (Ortho or Neuro) for a specialized hospital. It will require larger space with different set of equipment. But on other hand by combining rehabilitative services with the specialities can provide end to end care for the patients.

Skill Set– required skill set and its availability is also a major criterion to be considered while outsourcing. In a super speciality hospital setting up Dental department requires different kind of doctors and skill sets. Hospital branding & campaigning required exclusive skill set which belong to different sector.

Resources– in bees’ colony, the activities require high resource but having low or medium value proposition are taken care by the worker bees. In a same way in hospitals activities require Hugh manpower or consumables but the value addition to our goal is not much but supportive, it can be considered for outsourcing.  e.g. Housekeeping services, security services etc.

Hospital Outsourcing matrix

Quality, Cost & service efficiency are the part of the desirable outcomes and common in above said points but not the only criteria for decision making. These points should be covered while negotiations & preparing SLAs.

Disclaimer: The views expressed in this post are purely the thought of the author and are not meant to be derogatory to any institution or organisation. The author is open to further discussions. Thank you for your patience and tolerance.

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Setting up Hospital Quality System-six simple steps

When I was new to the healthcare management, I used to wonder how to initiate and setup quality system in a new hospital? What to do first and what to do next. As I suggested in my previous article, the setting up quality system should be initiate from the stage of civil planning. While looking for information, I came across an article on ‘Ford Assembly line’ and that gave me an idea to develop my own approach, assuming services as product and various execution stages as assembly docks which will refine and bring services in shape. The first and the most important step is to identify the services provided by the hospital and its focus areas.

For the selected services, organization should identify various processes & activities their flow with interdependent activities. Eg. If a high end trauma unit is the in the scope of services then one has to define process of delivering services, which will leads to resource planning (including neuro, ortho, reconstructive surgery as support services which will be requiring man, machine and material) and in turn will impact the civil drawings to accommodate them. This should be done by a cross functional team including quality champions, administrators, architect & doctors. The flow should be patient friendly and should address universal guidelines provided by national or international regulatory bodies. When the activities & detailed workflows are defined, the next step is to define procedures to perform these processes; rules to follow these procedures; how to follow procedures as work instruction. These are collected as documents known as SOPs, Policies and collectively called as manuals. eg. Process of trauma patient care include one procedure as triaging defined stepwise details in SOP; rules to follow during triaging including zoning, colour codes, responsibility matrix etc. will be covered in policy.

Who will execute these processes & policies? Before implementation Staff Awareness is required.  A detailed plan has to be made for training the staff as soon as they join the organization. While training, the points should be clear that how to do it, rules to follow, what if things went wrong & overall expectation. The comprehensive training programme can be divided in Universal Induction, department induction and continuous refresher training. The training content should be customized according to different categories of staff eg. Nursing, doctors etc. for better results. It should not be just dump of information but in small pieces so that the employee can absorb it. This would be time consuming process. Never forget to check the staff understanding towards these processes.

While the staff getting prepared for implementation, a parallel plan to be prepared on how to communicate and make our patients/visitors aware about our system. Patient’s awareness should be aligned to vision & mission of the top management. Eg if hospital is talking about ethical & transparent clinical practices in the mission statement, it should provide information regarding clinician’s protocols; doctor to patient communication, regular counselling during treatment/surgeries, how we take consent and why it’s important; what are the patient rights; how our feedback system works; what are our codes of conduct for patient care etc. Medium of communication is also very important aspect.

It’s very important to follow the process but it is more important to track whether these have been followed correctly with desirable outcome. That’s why key performance indicators and quality indicators come into picture which quantifies the procedures. These can be defined by identifying processes important to the management. For better understanding & for impact analysis, these can be collected in logical fashion under various dashboards with the aim of creating a decision support system. Identification of these QI & KPI can be during the first step but implementation and tracking would be done while hospital is operational.

Tracking & analysis of QI & KPI is a continuous process. Shortcomings or deviation from the assigned benchmark should be evaluated thoroughly. Root Cause Analysis, internal audits are the tools helping us to identify defects in the process or how the things went wrong. These audits must focus on processes not on an individual. Corrective action can be taken by the front team after consent from superiors but the preventive actions must be executed after through discussion amongst multi-disciplinary team. Preventive action will lead to change in the design of the complete system including SOPs & Policies. This will not only impact the hospital operations but also the finances. eg. If hospital identify the cause of decreasing hand hygiene rates as non-availability of disinfectants & training process, preventive measure may include adding-up more locations for keeping disinfectants which will leads to increase in inventory & cost, training staff repeatedly on usage thus impact on working shifts, changing the training process to increase its impact or policy of inclusion of bedside disinfectant bottle charges in bills etc.

This is a cycle and gets repeated during hospital operations for existing services & processes. Even new processes go through same sequence of synthesis.

Hospital Quality System setup

Disclaimer: The views expressed in this post are purely the thought of the author and are not meant to be derogatory to any institution or organisation. The author is open to further discussions. Thank you for your patience and tolerance.

Primary Healthcare in Rural Areas- A collective approach

As awareness is increasing towards health related issues, entrepreneurs & companies are coming forward with various initiatives for providing healthcare services in urban & rural India. Urban landscape is still satisfactory but rural areas are still void of such services.  These Initiatives vary from use of technology like telemedicine to tackling financial issue through rural insurance with microfinance or public-private partnership to setup health centres and many more. But sometime I wonder that what would be chances of setting up a successful rural healthcare model when the efforts are made in isolation keeping specific areas in mind. Is it feasible to apply it across country without understanding what the rural India wants & what is their needs?

I prefer to see the issue from patient’s perspective as what they require from healthcare delivery system. In my view, basic but affordable treatment at appropriate time by an adequately skilled physician is enough for the most of the rural population. For preventing diseases we should also address issues like basic hygiene, malnutrition & sanitation.

Incidence of non-communicable disease is around 35% in rural areas which contribute almost 68% of total Indian population in 2009. NCD anyways require tertiary care with advance intervention but must be diagnosed in early stage to reduce the adverse impact. Major cause of mortality among rural population is communicable diseases which usually require medical treatment not surgical intervention hence a basic infrastructure with proper medication in sufficient.

Then what are the obstacles for providing primary healthcare to rural India? Do we require magic to get it changed? I see it’s a mix of Infrastructure, Financing, cost of care and administrative policies issues. This is combined with absence of people awareness towards their health needs.

We already have an old infrastructure but needs to be expended so that PHC get setup in every small town having mix of doctors from different discipline of medicine (Allopath, Ayurveda, Homeopathy) to have cross discipline plan of care. These PHC to be covered by BLS equipped ambulances stationed strategically and shared between nearby villages. Cluster of PHCs to be supported by secondary care hospital. These PHC & secondary care hospital can be run by private healthcare providers on a contract basis that will give efficiency and effectiveness to the system. Comprehensive system to be setup for collecting, evaluating & monitoring healthcare performance indicators to be setup for future planning & identifying the effectiveness.

There is a need of various awareness campaigns focusing separately on preventive aspect of communicable diseases & life style alterations to prevent non-communicable disease. A nation-wide network of NGOs, healthcare providers should be built for training and developing local resources.

Policy makers should focus on promoting innovation in field of affordable medical consumable, equipment & technology by creating favourable environment for entrepreneurs & investors. Separate tax structure for the doctor and health care workers working in rural area, Conducive environment for pharmaceutical companies supplying in rural areas, tax exemptions for equipment used in rural areas & promoting new comers in healthcare delivery are some of the measures that may inspire service providers to work in rural areas. Healthcare should be priority in the local government’s agenda.

Promoting & structuring medical tourism is important to strengthen private sector financially and make them to lower indigenous pricing by cross subsidization. State sponsored health insurance coverage including medicines and making health insurance as mandatory. NGOs can initiate and create a pool of volunteers willing to support rural family for their healthcare needs by financing their health insurance.

Controlling the cost of care is the most important aspect for continuing primary healthcare delivery model. Now it’s time to realize the power of indigenous medicines system (AYUSH) which is known to most of the rural India. Focusing on preventive medicine & lifestyle improvements, wide use of technology for communication and information sharing and developing resources in local community for spreading awareness can help us to reduce the cost of care. Inventory management system to be developed & run by the private sector including medicine & consumable.

It doesn’t require Magic to create primary healthcare as right to every citizen. It can be achieved by a collective & systemic approach with full commitment. This has to be a joint effort from policy makers, healthcare industry, NGOs and every individual that can make a difference.

Disclaimer: The views expressed in this post are purely the thought of the author and are not meant to be derogatory to any institution or organisation. The author is open to further discussions. Thank you for your patience and tolerance.

Prelude-Quality for Hospitals

I will go one step back and want to evaluate whether our approach is correct to our quality journey. The most important step towards quality is to have a commitment from the top management and fixing the goal. This should be captured in the documents (policies, protocols & SOPs) in an appropriate manner. The preparation of the document should not be merely for fulfilling the accreditation criteria but should be followed sincerely. The main challenge is to change the mind-set of the hospital staff towards quality system and it’s the time consuming process which needs to be initiated from the first group of employees. Quality systems is not burden or to identify fault but to improvise and provide the best to the patients.

When we talk about manufacturing industries, the emphasis is on spending more time on planning so that the implementation would be with minimum defect. But in hospital setup we never follow this concept. All quality related activities get initiated after completing the hospital building and starting operations.

In today’s scenario the approach is very different. First a hospital starts operations and while working identify issues and these issues are addressed with temporary fix. Such fix gets routine, thus inspires the management to build a system. Remember such system which is inspired by temporary solutions will always fail. When it start impacting other areas and no way-out get identified, the management starts aggressively focusing on quality systems. This process of self-exploration leads to loss of valuable time and thus impacts the hospital services and financials. Admission & discharge process, OPD processes & infection control, Emergency response are such issue which are never a focus while building an infrastructure or even preparing and following SOPs.

The best approach is to incorporate Quality concept at the beginning of the project. We can’t dissociate it from business plan. By amalgamating efficient processes design and quality systems together, we can optimize cost and can build appropriate infrastructure for patients. This requires to be run from top and to be included in the vision.