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1. What type of organizations should CMC use as benchmarks?
CMC should use its two major competitors Johnson Medical Center (JMC) and Lutheran Medical center as the benchmarks. JMC is a 430 bed tertiary care facility that has approximately 1920 full time equivalents (FTEs) and this approximately 5.2 FTEs per adjusted occupied bed. JMC should be used as a benchmark because it has been able to successfully reduce FTEs as well as flatten its structure and improve its operations. These are some of the things that CMC wishes to correct and therefore, using JMC as a benchmark in order to prove will not only improve its competitive edge in the market but also make it more efficient.
The outpatient revenues for the JMC have grown and the profit margins have been able to exceed 5 percent as compared to the previous three years. Therefore, for this reason JMC can be described as a very strong competitor and consequently using it as a benchmark will be absolutely important for the management if they are willing to take the company forward. LMC is the other company that CMC needs to use as the benchmark. LMC despite being smaller in services and having bed occupancy of around 310 beds. The hospital is highly regarded and enjoys an occupancy rate of around 75 percent. CMC needs to be strong in obstetrics and therefore, they should borrow a leaf from LMC which is known to be strong when it comes to obstetrics, pediatrics, ambulatory care and general medicine. For this reason, CMC should be able to look up to what LMC is doing and therefore, they will be able to attract well insured patients from the affluent suburban areas as LMC is doing.
2. Who should be involved in developing the Center's bench marking strategy, and what point do you get them involved?
The first person that should be used in developing the center’s bench marking strategy is the Chief Financial Officer, this is because this is the person that understands the Hospital’s financial problems and how they can be efficiently alleviated. For example, the Chief financial officer has identified some of the factors that he believes are a major problem in the Hospital, they include the fact that there exists three unions as well as a lot of money being pumped into other CMC subsidiary company.
The Chief Financial officer should be present at the start to the finish of making the benchmark strategy for the company. The Governing board which consists of 27 members should also be included. The physician and chief of staff should be given priority and there is also a need to include several doctors in order to have the feel of the situation at the ground. These persons including the governing board should be included in the initial stages of planning. The CEO should most importantly be included in the design of the strategy and try to convince the board members about the importance of the board members of changing several things. There is a need to reduce the friction and tension that is created by the two boards. These conflicts need to be decreased if the strategy is to be implemented; therefore, there is a need for the two groups to be introduced at different stages.
This will ensure that the friction is decreased and that the strategy is able to be designed without hitches. The parent company board should be introduced later in the design of the strategy as they have a tendency to feel that they own the company and consequently micromanage the Center’s routine operations. Several members of the medical staff should also be included in the design stage because they represent the interests of the entire medical staff and consequently they have information in regards to what should be done and how the ground looks like. Further, it will also be important for them to be included because at CMC historically, they have been viewed as a difficult group when it comes to co-operating with the board as well as administration. Therefore, the design of the strategy process will give the two a chance to ensure that they move forward and find common ground for the Medical center which will help it move forward towards better healthcare and increased profits.
3. How will you know whether the CMC plan to increase healthcare value is a success?
One will know whether the CMC plan to increase healthcare value is a success by measuring what happens to the whole person across space and time. The hospital will have to present a more complete picture of the patient’s health beyond the snapshot that they are current receiving. Therefore, rather than CMC capturing data when the patients are sick and being treated, the hospital will have to give out longitudinal measure which encompasses the general after health of the patient and a wellness programs. Further, the number of patients that reach full wellness will also be taken into account when it comes to the measuring of value.
For example, with knee replacements, measuring value would therefore, entail in determining whether the patient walk better six months after the operation. Measuring Asthma can be dubbed successful if the patient is able to successfully sleep through out the night, lastly depression medications can be described to be successful if the patients are monitored closely and they are found to return to their careers and participate in their family life again.
The current system that is used in healthcare and in CMC is inaccurate as it often tracks which doctors perform, the medications physicians prescribe as well as the therapies that the clinicians recommend. However, it is imperative to understand that switching to value based system can be said to be a chicken and egg problem and therefore, CMC should be able to ensure that technology works to catch up with the intent. The current system is generally based on the measures of outcome, and therefore, everybody works hard to ensure that they increase the volume. However, in order to measure CMC increased health value, there is a need to create a data infrastructure which does not move quickly in terms of payment and looks keenly into the after-sale services of different treatments. Therefore, looking at data of whether the patients will be able to perform six months or one year after the surgery will be important in measuring health care value.
4. What do you see as the future of bench marking and value improvement at CMC?
The future bench marking at CMC is bright, if the company takes the right steps it will be able to move on from the local hospitals and benchmark with even larger companies that have bed occupancy that range into 1000s. This is because there is potential given the goodwill that the center has from the local populace. Further, another thing of importance is the increasing population in the area, this cannot be underestimated as increased population translates into increased customers for the center. Therefore, by increasing its bench marking capabilities it will be able to understand effectively and efficiently how things are done and what is the best way when it comes to ensuring that the company is able to move forward as it grows in size as well as profits.
Value improvement has a future in CMC, the center will most likely in the future be able to incorporate technology in value improvement. The center has been able to create some cornerstone task which will be translated into digital platforms. The center in the future will involve a healthcare system that implements technology and automating paper process. In the future therefore, the Center is expected to have a strong commitment towards measuring value and the creation of elaborate data infrastructure in order to permit the kind of value.
Institute of Medicine (U.S.)., Yong, P. L., Olsen, L. A., & McGinnis, J. M. (2010). Value in health care: Accounting for cost, quality, safety, outcomes, and innovation : workshop summary. Washington, D.C: National Academies Press.
Improving Value in Health Care: Measuring Quality. (2010). Paris: OECD.
Ross, D. M., & University of Central Florida. (2008). Healthcare transitions and the aging population: A framework to measure the value of rapid rehabilitation.
Bower, A. G., RAND Health., Rand Corporation., Cerner Corporation., General Electric Company., Hewlett-Packard Company., Johnson & Johnson., ... Xerox Corporation. (2006). The diffusion and value of healthcare information technology. Santa Monica, CA: Rand Corp.
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