Gold Standard Management low cost best value practices toolset

Low Cost Toolset

Many hospitals pursued a mistaken strategy of layoffs and cost cutting in recent years which damaged organizational culture and destroyed morale, yet failed to get at the underlying problem of inefficient systems. The Low Cost Toolset works in concert with High Quality in an interrelated approach. Major cost can only be removed by getting at underlying systems, but a sound approach also looks for the nickel and dime savings and institutionalizing an efficiency mindset. Experience has shown that several million dollars can be obtained in the first year with no loss of jobs. This change manual organizes the work to be done under various Initiatives (in bold) and the specific Tasks they require (bulleted). Sample Task. Full Toolset available in Member Downloads .

Toolset Manual Contents

LC.0 Change Module Assignments

MAC Administration Instructions
Executive Introduction
Module Leader Instructions
Initiative Team Instructions
LC.1 Preparation for Session IV and Changes Addressed at the Management Training
LC.1.2 Change Elements Introduced By MHI At TUL Session
LC.1.3 Process Incoming Manager Suggestions From TUL Session
LC.1.4 "What I Want To See In A Proposal" By The CEO
LC.1.5 Develop Low Cost Tactical Plan
LC.1.6 Conduct People Climate Audit In Preparation For CI
LC.1.7 Staff Swapping
LC.2 Low Cost Initiatives for People Productivity
LC.2.1 Develop People Productivity
LC.2.2 Add Tools As Primary Strategy To Make People Time
LC.2.3 Review Of Decision Times
LC.2.4 Power Up Down Times
LC.2.5 Develop Light Duty Return-To-Work Program
LC.2.6 Out-Source Sideline Operations
LC.2.7 Education/Conference Audit
LC.2.8 Evaluate Information Services
LC.2.9 Review On-The-Job Training Processes
LC.2.10 Review Reasons For Associate Overtime
LC.2.11 Evaluate Patient Preparation Protocols
LC.2.12 Standardize Common Patient Care Administrative Processes
LC.2.13 Standardize Common Administrative Clerical Processes
LC.3 Low Cost Initiatives for Financial Processes
LC.3.1 Install New Policy: All Service Contracts Require A Full Rebidding Process
LC.3.2 Manage Private Pay Customers
LC.3.3 Maximize Cash Flow Management
LC.3.4 Evaluate Accounts Payable Schedule
LC.3.5 Maximize Speed Of Service To Billing Cycle
LC.3.6 Eliminate Lost Charges
LC.3.7 Review The Timing Of Budget Reports
LC.3.8 Evaluate Furniture/Equipment Storage
LC.3.9 Evaluation Of Paid Medical Directors
LC.3.10 Review The Cost Management Of Marketing Needs
LC.3.11 Review Organizational Marketing Costs
LC.3.12 Review Budget Variance Reporting Practices—Standardize
LC.3.13 Evaluate Policy/Practices Of Providing Associates With Lab Coats, Kleenex, Coffee & Other Creature Comforts
LC.3.14 Review Precertification Process To Capture Revenues
LC.3.15 Review Medical Documentation For Reimbursement
LC.4 Low cost Initiatives for Operating Processes
LC.4.1 Identify Service Lines
LC.4.2 Redesign Executive Structure To Reflect Horizontally
Flexible Organization
LC.4.3 Standardize Supplies; Reduce Number Of Suppliers
LC.4.4 Redesign Organization Structure To Streamline Communications
LC.4.5 Eliminate No/Low Value-Added Services
LC.4.6 Paper Systems Condensing
LC.4.7 Revisit Pay Evaluation Practices
LC.4.8 Locate and Reduce Areas Of Waste—Cost Containment Audit
LC.4.9 Natural Resources Management Audit
LC.4.10 Patient Transportation Analysis
LC.4.11 Review Toxic Waste Management Process/Costs
LC.4.12 Review and Revise Catering Requests And Guidelines
LC.4.13 Review Purchasing Process
LC.4.14 Review The Life Span And Repair Tendencies Of Durable Medical Equipment
LC.4.15 Conduct Cost Analysis Of Internal Staff vs Purchased Services For All External Services Used
LC.4.16 Consider Substituting Reusable Materials For Disposable Materials
LC.4.17 Review The Policy/Practice On Free Meals In The Cafeteria
LC.4.18 Review The Procedures & Protocols For Recycling Expensive Materials and Supplies
LC.4.19 Evaluate Hospital Mailings And Costs
LC.4.20 Manage The Costs of Printing/Duplication
LC.4.21 Personal Use of Facility Services
LC.4.22 Develop A Process For Handling A Large Number Of Referrals At One Time To Avoid Customer Delay And Frustration
LC.5 Low Cost Initiatives for Managing Innovation
LC.5.1 Manage Innovation
LC.5.2 Resourcing & Rewarding Innovation
LC.5.3 Measure & Set Goals For Innovation
LC.5.4 Install The Idea Engine
LC.5.5 Develop Reward & Recognition For Low Cost Improvement
LC.5.6 Standardize Common Patient Care Administrative Processes
LC.6 Begin Physician Focus of Low Cost Initiatives
LC.6.1 Physician Utilization of Care Maps/Clinical Protocols
LC.6.2 Evaluate the Use of Economic Credentialing for Physicians
LC.6.3 Review Services Provided To Physicians & Cost/Benefit Analysis of The Services
LC.6.4 Evaluate Contents Of New Hire/Associate Physical Exam For Appropriateness & Cost Effectiveness
LC.6.5 Evaluate Possibilities Of Standing Physician Orders For High Need, High Patient Load/Traffic Areas

Sample Task

TASK LC.2.3 REVIEW OF DECISION TIMES

Priority: A
Timing: Session III
Teamleader: Module Leader
Recommended Approach: DIG
Other Assignees: None
Interactions With Others: None

Work To Do: Identify where there are unacceptable delays in decision-making and approvals both within each manager’s individual departmental operations, and within chains of authority, communication, approval processes, and within councils and committee structures. There are no “sacred cows” in this Task. Look at committees and task forces, board meetings, normal line approvals for all functions including financial, clerical, and general operational and administrative functions.

Chart out the time frames for approvals of all decision-making types within each department, from department to department, and from department to executives, and from executives to administration. The goal is to reduce decision-making times by 50% at a minimum. Analyze why decision making takes so much time, and create ways to bust time barriers. Common reasons for lengthy decision-making include:

The decision-maker is not available for some period of time and thus cannot address the question/decision.
The decision requires the input of many people and it takes a goodly length of time before all parties have a common time available to address the question.

The speed with which decisions are processed directly affects the speed with which the organization can operate. Cut out “waiting times,” reduce the number of people that must be involved in the decision-making. Utilize a more rapid communication process, i.e. e-mail, v-mail, etc. and establish standard operating timeframes for decision-making. The goal should be to address any and all decisions within three to five business days with the majority of decisions being handled within a standard of 36 hours. The collective time involved within a slow decision-making process does not insure a better decision, it only assures slower organizational performance.

Set time deadlines, e.g., executives have seven days to approve a DIG recommendation which typically is formulated under a standard 30 day time allottment.

Revamp each system and/or process where time delays are occurring, aim for a minimum 50% reduction in time or more. Think in creative New American Hospital terms. When experiencing barriers to change and improvement, take the issue to the operating vice president for resolution and support.




		Low Cost Toolset Many hospitals pursued a mistaken strategy of layoffs and cost cutting in recent years which damaged organizational culture and destroyed morale, yet failed to get at the underlying problem of inefficient systems. The Low Cost Toolset works in concert with High Quality in an interrelated approach. Major cost can only be removed by getting at underlying systems, but a sound approach also looks for the nickel and dime savings and institutionalizing an efficiency mindset. Experience has shown that several million dollars can be obtained in the first year with no loss of jobs. This change manual organizes the work to be done under various Initiatives (in bold) and the specific Tasks they require (bulleted). Sample Task. Full Toolset available in Member Downloads . Toolset Manual Contents LC.0 Change Module Assignments MAC Administration Instructions Executive Introduction Module Leader Instructions Initiative Team Instructions LC.1 Preparation for Session IV and Changes Addressed at the Management Training LC.1.2 Change Elements Introduced By MHI At TUL Session LC.1.3 Process Incoming Manager Suggestions From TUL Session LC.1.4 "What I Want To See In A Proposal" By The CEO LC.1.5 Develop Low Cost Tactical Plan LC.1.6 Conduct People Climate Audit In Preparation For CI LC.1.7 Staff Swapping LC.2 Low Cost Initiatives for People Productivity LC.2.1 Develop People Productivity LC.2.2 Add Tools As Primary Strategy To Make People Time LC.2.3 Review Of Decision Times LC.2.4 Power Up Down Times LC.2.5 Develop Light Duty Return-To-Work Program LC.2.6 Out-Source Sideline Operations LC.2.7 Education/Conference Audit LC.2.8 Evaluate Information Services LC.2.9 Review On-The-Job Training Processes LC.2.10 Review Reasons For Associate Overtime LC.2.11 Evaluate Patient Preparation Protocols LC.2.12 Standardize Common Patient Care Administrative Processes LC.2.13 Standardize Common Administrative Clerical Processes LC.3 Low Cost Initiatives for Financial Processes LC.3.1 Install New Policy: All Service Contracts Require A Full Rebidding Process LC.3.2 Manage Private Pay Customers LC.3.3 Maximize Cash Flow Management LC.3.4 Evaluate Accounts Payable Schedule LC.3.5 Maximize Speed Of Service To Billing Cycle LC.3.6 Eliminate Lost Charges LC.3.7 Review The Timing Of Budget Reports LC.3.8 Evaluate Furniture/Equipment Storage LC.3.9 Evaluation Of Paid Medical Directors LC.3.10 Review The Cost Management Of Marketing Needs LC.3.11 Review Organizational Marketing Costs LC.3.12 Review Budget Variance Reporting Practices—Standardize LC.3.13 Evaluate Policy/Practices Of Providing Associates With Lab Coats, Kleenex, Coffee & Other Creature Comforts LC.3.14 Review Precertification Process To Capture Revenues LC.3.15 Review Medical Documentation For Reimbursement LC.4 Low cost Initiatives for Operating Processes LC.4.1 Identify Service Lines LC.4.2 Redesign Executive Structure To Reflect Horizontally Flexible Organization LC.4.3 Standardize Supplies; Reduce Number Of Suppliers LC.4.4 Redesign Organization Structure To Streamline Communications LC.4.5 Eliminate No/Low Value-Added Services LC.4.6 Paper Systems Condensing LC.4.7 Revisit Pay Evaluation Practices LC.4.8 Locate and Reduce Areas Of Waste—Cost Containment Audit LC.4.9 Natural Resources Management Audit LC.4.10 Patient Transportation Analysis LC.4.11 Review Toxic Waste Management Process/Costs LC.4.12 Review and Revise Catering Requests And Guidelines LC.4.13 Review Purchasing Process LC.4.14 Review The Life Span And Repair Tendencies Of Durable Medical Equipment LC.4.15 Conduct Cost Analysis Of Internal Staff vs Purchased Services For All External Services Used LC.4.16 Consider Substituting Reusable Materials For Disposable Materials LC.4.17 Review The Policy/Practice On Free Meals In The Cafeteria LC.4.18 Review The Procedures & Protocols For Recycling Expensive Materials and Supplies LC.4.19 Evaluate Hospital Mailings And Costs LC.4.20 Manage The Costs of Printing/Duplication LC.4.21 Personal Use of Facility Services LC.4.22 Develop A Process For Handling A Large Number Of Referrals At One Time To Avoid Customer Delay And Frustration LC.5 Low Cost Initiatives for Managing Innovation LC.5.1 Manage Innovation LC.5.2 Resourcing & Rewarding Innovation LC.5.3 Measure & Set Goals For Innovation LC.5.4 Install The Idea Engine LC.5.5 Develop Reward & Recognition For Low Cost Improvement LC.5.6 Standardize Common Patient Care Administrative Processes LC.6 Begin Physician Focus of Low Cost Initiatives LC.6.1 Physician Utilization of Care Maps/Clinical Protocols LC.6.2 Evaluate the Use of Economic Credentialing for Physicians LC.6.3 Review Services Provided To Physicians & Cost/Benefit Analysis of The Services LC.6.4 Evaluate Contents Of New Hire/Associate Physical Exam For Appropriateness & Cost Effectiveness LC.6.5 Evaluate Possibilities Of Standing Physician Orders For High Need, High Patient Load/Traffic Areas Sample Task TASK LC.2.3 REVIEW OF DECISION TIMES Priority: A Timing: Session III Teamleader: Module Leader Recommended Approach: DIG Other Assignees: None Interactions With Others: None Work To Do: Identify where there are unacceptable delays in decision-making and approvals both within each manager’s individual departmental operations, and within chains of authority, communication, approval processes, and within councils and committee structures. There are no “sacred cows” in this Task. Look at committees and task forces, board meetings, normal line approvals for all functions including financial, clerical, and general operational and administrative functions. Chart out the time frames for approvals of all decision-making types within each department, from department to department, and from department to executives, and from executives to administration. The goal is to reduce decision-making times by 50% at a minimum. Analyze why decision making takes so much time, and create ways to bust time barriers. Common reasons for lengthy decision-making include: The decision-maker is not available for some period of time and thus cannot address the question/decision. The decision requires the input of many people and it takes a goodly length of time before all parties have a common time available to address the question. The speed with which decisions are processed directly affects the speed with which the organization can operate. Cut out “waiting times,” reduce the number of people that must be involved in the decision-making. Utilize a more rapid communication process, i.e. e-mail, v-mail, etc. and establish standard operating timeframes for decision-making. The goal should be to address any and all decisions within three to five business days with the majority of decisions being handled within a standard of 36 hours. The collective time involved within a slow decision-making process does not insure a better decision, it only assures slower organizational performance. Set time deadlines, e.g., executives have seven days to approve a DIG recommendation which typically is formulated under a standard 30 day time allottment. Revamp each system and/or process where time delays are occurring, aim for a minimum 50% reduction in time or more. Think in creative New American Hospital terms. When experiencing barriers to change and improvement, take the issue to the operating vice president for resolution and support.
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