USING SIX SIGMA FOR PROCESS IMPROVEMENT IN HEALTHCARE

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USING SIX SIGMA FOR PROCESS IMPROVEMENT IN
HEALTHCARE
Is 99 Good Enough?
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Three hospital campuses
380 acute care beds 110 long-term care

• Full range acute tertiary
• Open Heart Surgery
• Cancer Treatment
• Neonatal Intensive Care
• Psychiatric Services
• Home Health
• Emergency Medical Services
• Managed Care
• Primary Care Walk-in Clinics
• OP Rehab Center
• Physician Practices
• Free Clinic
• Long Term Acute Care Hospital
• Health and Wellness Center

Bowling Green
Scottsville
Franklin
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Introduction
In late 1997, President and Chief Executive
Officer of Commonwealth Health Corporation,
(CHC), attended a conference and listened with
interest as General Electrics CEO spoke of his
vision for GE as a World Class Six Sigma company.
This innovative approach to quality and error
reduction was at this point already receiving
high marks for its transformational abilities at
all levels of corporate enterprise. Later
conversations between the two leaders revealed a
shared passion for excellence and commitment to
quality. This initial encounter soon led CHC to
embrace this vision of quality at Commonwealth
Health Corporation.
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CHC VIDEO
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What is Six Sigma?

• Measure of Quality
• Expresses how close a process or service comes
  to meeting its customers expectation.
• Method for Continuous Improvement
• Uses a rigid framework to approach process
  improvement.
• Mindset for Culture Change
• When successful, Six Sigma fundamentally changes
  the culture and operating philosophy of the
  company. It becomes the way to do our job.

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Z or Sigma Level
Sigma Level Defect Rate Defects per
Million 2 30.8 308,537 3
6.7 66,807 4
0.62 6,210 5 0.0233 233 6
0.00034 3.4
By using the Sigma level to express how good a
process is, we are able to compare dissimilar
processes. Example Radiology report turnaround
time is at 2 sigma while an ambulances arrival
on the scene is 4.3 sigma.
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Is 99 Good Enough?
99 Good (3.8 Sigma) 99.99966 Good (6 Sigma)
200,000 wrong drug 68 wrong
prescriptions prescriptions each year each
year 5,000 incorrect surgical 1.7
incorrect surgical operations each week
operations each week 50 newborn babies dropped
One newborn baby dropped at birth each day
every 2 months
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What Makes Six Sigma Different?

• Process is measured using the customers
  specification rather than
• internally established thresholds

• Analysis is data driven

• Improvements are statistically valid

• Improvements are tested and proven

• Processes are controlled

• Project framework is rigid

• Methodology is robust

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Culture change

• Traditional Beliefs
• Quality costs money
• Inspection and rework can capture defects
• Quality of output is enough
• Control the worst case and the average
• 99 defect free is good enough
• Documentation can control quality

• Six Sigma Beliefs
• Poor quality is extremely expensive
• Defects must be prevented
• Quality must be built into the process (Sony TVs)
• Variability is the enemy
• Need to achieve 3.4 defects per million
• Mistake proof to sustain quality

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Strategic Alignment to Driving Results
Leverage Resources
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Organizational Dashboard for Success

• Customer Satisfaction

Measured by Press Ganey Scores

• Quality of Service

Measured by Timeliness (a rolled z score)

• Efficiency

Measured by Operating Margin (cost per unit
produced at departmental level)
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Action Plan

• Customer Service/Satisfaction
• Reduced Wait Times
• Meeting Service Expectations
• Delivered Quality of Care
• Reduced Medical Errors
• Increased Safety
• Use of Appropriate Technology
• At Lower Cost
• Increased Productivity
• Decreased Cost

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Functional Structure
Master Black Belts
PRESIDENT AND CEO
Hospital CEO Sponsor
Press Ganey Score Target
Brown Belts
EVP Sponsor
Champions Sponsors
Timeliness Z Score Target
Green Belts
EVP Sponsor
Cost Efficiency Target
Change Agents
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Project Profile Radiology Staffing Efficiency
Operational Problem Labor Costs Too High in
Radiology
Defect Occurs any Time Staffing Exceeds Labor
Resources Required For Exam Volume
Baseline .3 Sigma DPMM 382,000 Critical X
Staff Schedule

• Improvements
• Staff Used CAP
• Work-out to
• Redesign Schedule
• 14 Positions Eliminated
• 1st Yr. Savings 860,000

Controlled Process 1.15 Sigma DPMM 125,000
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Financial Returns
Radiology Cost Per Procedure
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Senior Managements Involvement

• Created Vision Statement
• Identified CTQs
• Attended CAP/Workout Training
• Attended Greenbelt Training provided by GE
• Shadowed Greenbelt Projects
• Participate in Formal Reviews by Greenbelts
• Driven from top-down

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Key Learnings

• Commitment is Critical
• Ideally From the Top
• Watch for Address the Holdouts
• People Selection
• Best Brightest
• Project Selection
• Tied to Strategic Objectives
• Financial Results Validation
• Challenging, Challenging, Challenging
• Culture Change vs. Quality Tool

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Problem Statement
As employers continue to pass more of the cost to
their employees through larger deductibles,
higher co-pays, lower percentage of
reimbursement, etc., reducing the loss that
results from the patients portion not being paid
becomes increasingly important.
Measuring the length of time involved from point
of service until payment is received on the
self-pay portion of the patients bill on
commercial accounts.
Define
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Scope of Problem
Defect any length of time greater than 104 days
ZST 1.36 DPPM 556,922
Measure
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Root of Problem
Emergency Room charges account for 40 of the
defects.
Analyze
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Root of Problem
Mood Median Test stacked versus subs Mood median
test for stacked Chi-Square 10135.57 DF 4
P 0.000
Individual 95.0 CIs subs Nlt Ngt
Median Q3-Q1 ------------------------------
---- Amt. of 4531 590 1.0 1.0
Coded Bi 3221 1900 3.0 2.0
coded lo 74 5020 20.0 7.0
-) coded ty 1787 3334
7.0 4.0 Primary 3970
1151 2.0 2.0
-----------------------------
-----
6.0 12.0 18.0 Overall median 3.0
There is a statistical difference in the medians
based on location (Emergency Department).
Analyze
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Pilot
POINT OF SERVICE COLLECTIONS INITIATIVE EMERGENCY
DEPARTMENT   Modified ED patient flow processes
to ensure all eligible patients are routed
through a formal checkout after being treated
and discharged by clinicians.   Developed job
description for Financial Counselor position.
Interviewed and hired a Financial Counselor.
Developed training schedule, which started on
March 21st. Went through a very extensive
training schedule including tutorials on
collection techniques and role-playing. Training
with CFM, Hillcrest Credit Agency, Patient
Registration, and Six Sigma representatives.
Hours for the position are Sunday through
Thursday, 100pm through 900pm. Comprehensive
education and dialogue took place prior to
rolling out the new processes to secure buy-in
and compliance from staff.   Developed a new
policy and procedure for post dated checks which
allows us to collect money while ensuring the
post dated checks are not deposited before the
agreed date. This new policy allows for a check
to be written with a payable/deposit date up to 5
days from the time of service.  
Improve
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Pilot
POINT OF SERVICE COLLECTIONS INITIATIVE EMERGENCY
DEPARTMENT   Developed a comprehensive reference
manual for the Financial Counselor.   Developed a
patient education leaflet to distribute to all
patients at time of registration. Murray Raines
reviewed prior to implementation.   Developed
standardized cash collection procedures and
forms.   Developed necessary tools for ongoing
performance analysis. These include sample
scripting, payer matrix, key metrics to be
completed daily, and monthly trend analysis.
Will use the monthly trend analysis to benchmark
progress against goals, highlight shortcomings
and target interventions. Financial Counselor
scripts have been developed specific for self-pay
patients as well as insured patients with
co-pays.  
Improve
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Pilot
POINT OF SERVICE COLLECTIONS INITIATIVE EMERGENCY
DEPARTMENT     The newly designed process
includes the nurse bringing patients to the
checkout desk after treatment. We are currently
working with the nursing staff to increase
compliance of routing patients to the financial
counselor desk. Careful scripting has enhanced
customer interactions. The first full week of
implementation was April 3rd and to date, we have
had no official complaints.
Improve
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Results
Totals Dollars collected during this time frame
1,613
7 Weeks (35 days) Prior to Pilot
9,141
7 Weeks (35 days) During Pilot
Improve
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Results
Chi-Square Test GOOD, BAD Expected counts are
printed below observed counts GOOD
BAD Total 1 22 13 35
(Before Pilot) 28.00 7.00 2
34 1 35 (After Pilot)
28.00 7.00 Total 56 14
70 Chi-Sq 1.286 5.143 1.286
5.143 12.857 DF 1, P-Value 0.000
P value of 0 indicates a statistical difference
in the number of days that money was collected
prior to and after the pilot. The same 7 week
time period was used (35 days).
Improve
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Results
Chi-Square Test Re-Measure Pass, Re-Measure
Fail Expected counts are printed below observed
counts Re-Measu Re-Measu Total 1
37 3304 3341 (BEFORE PILOT)
122.69 3218.31 2 209 3149 3358
(AFTER PILOT) 123.31 3234.69 Total
246 6453 6699 Chi-Sq 59.846 2.281
59.543 2.270 123.941 DF 1,
P-Value 0.000
P value of 0 indicates a statistical difference
in the number of patients that money was
collected from prior to and after the pilot. The
same 7 week time period was used (35 days).
Improve
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Results
Identifying incorrect information given at time
of registration and making corrections
(re-scanning correct insurance card, etc.),
reducing re-work and increasing turn around time
on payment. Continuing to work on clinical
compliance (24 hour mandate should show marked
improvement). With relatively little investment,
the analysis suggests potential increases in POS
annual cash collections in the ED by
approximately 203,712. During this 35 day time
frame, promissory notes amounting to 11,716 have
been signed at POS. No attempts made at POS
previously. Deter future unnecessary visits to
the Emergency Room.
Improve
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Results
Control
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Finalized cost based on a 92.3 reduction in the
rate of defects 1,388,401
Financial Results
Control
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Sustaining Success
Presented findings to stakeholders and corporate
sponsors. Met with Director/Supervisor of ER
registration and turned project over. Reviewed
re-measure dates and procedures for collecting
and monitoring. Developed procedure for
collecting data and updating dashboards.
Provided dashboards and training/instructions
for updating and distribution. Leveraged
learnings in Outpatient setting. Completed
project binder.
Control
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Transfer the Learnings
Based on the success of the Emergency Department
project, we started a similar project in the
Outpatient areas and are currently transferring
those learnings to our Scottsville and Franklin
hospitals for their Emergency Departments and
Outpatient areas. Prior to the project, there
was virtually no point of service collection. We
now collect more that 10,000 in the ED most
months at our Bowling Green location. In the
Outpatient areas, we previously collected about
5,000 in a three-month period. After applying
the same methodology, monthly collections for
outpatients have increased to 50,000 each month.
The Point of Service collection projects are in
the pilot phase preparing for implementation. We
anticipate equally good results in those
locations.
Control
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QUESTIONS?
THANK YOU!
Six Sigma In Healthcare