How Six Sigma and Project Management are Improving Healthcare

Over the past few decades, healthcare providers have faced enormous challenges. Competition increased and additional regulations were implemented; survival meant adopting a business model that emphasized cutting costs while simultaneously improving the quality of care. In addition, inefficiencies and waste in the healthcare industry proved difficult to overcome.

To tackle these challenges and institute more sustainable business practices, leading healthcare providers embraced the principles and tools of Six Sigma and Project Management. When led by trained professionals, healthcare providers are proving they can reduce the industry’s characteristic variables while increasing efficiency, reining in spending, cutting waste and improving the quality of patient care.

Success Stories: Six Sigma in Healthcare

From improving floor layouts to reducing delays in health insurance claims, Six Sigma has improved operations for healthcare providers, insurance companies and pharmaceutical firms:

• • Virginia Mason Medical Center in Seattle runs a 336-bed hospital, as well as primary and specialty care clinics and has used the principles of Six Sigma to improve operations since 2002. Successes include reducing unnecessary imaging, such as MRIs, significant increases in patient satisfaction, and better patient care through the use of visual cues that minimize verbal communication and associated errors.

• • North Shore University Hospital in New York instituted a Six Sigma project to reduce wait times in its emergency department. With three competing hospitals close by, the staff was under pressure to reduce variables and decrease the time from patient arrival to discharge, which averaged more than three hours. Using Six Sigma, wait times decreased by 37% and deviation by 50%. Prior to the project, the emergency team thought that staff shortages caused excessive wait times. However, they learned that the process was the real problem. Staff and patient experiences subsequently improved.

• • Merck, a pharmaceutical company, embraced continuous improvement to overcome challenges, such as raising its line-item fill rate for top-selling products. Although the goal of one plant was to fill 1.4 million vials per week, actual fill rates ranged from 700 to 1.2 million. By instituting the problem-solving methods of continuous improvement, each of the issues that prevented the goal from being achieved was solved, and 1.4 million became the standard.

Project Management and Business Process Management in Healthcare

Healthcare is becoming increasingly complex and competitive, but when the principles of Project Management and Business Process Management (BPM) are implemented, providers can do a better job delivering quality care to patients.

For example, Sparrow Hospital in Lansing, Michigan, applied Project Management principles to disease-specific care (DSC) practices, including pediatric and adult asthma, and chronic obstructive pulmonary disease (COPD). The goal was to improve patient care by requiring fewer and/or shorter hospital visits, fewer tests, and less medication. In four years, the project yielded margins and savings of more than $2 million. Hospital stays for each area decreased, and the readmission rate was reduced to less than 1%.

Coordinating the number of processes inherent in delivering healthcare, while managing the amount of information produced, requires targeted Business Process Management. BPM technology can automate many standard processes, like patient enrollment and insurance claim appeals. Massachusetts health insurance provider Fallon Community Health Plan adopted BPM technology to ensure compliance with state and federal healthcare regulations – and was the first healthcare insurance exchange in the state ready to go live when the Affordable Care Act launched in October 2013. The company relies on BPM to implement new automated processes while remaining flexible enough to update them as regulations warrant.

Making Smarter Decisions with Reliable Tools

When hospitals, pharmaceutical firms, insurance companies, and healthcare providers implement the flexible tools of Six Sigma, Project Management and Business Process Management they can improve efficiencies, reduce costs and boost patient care. Healthcare is a challenging and growing industry, with opportunities for trained professionals who can employ these proven methodologies.