Patients in an emergency department (ED) waiting room on a Saturday night may disagree, but healthcare professionals know the industry moves at a frenetic pace. That’s why so many television dramas are set in hospitals, with EMTs busting through the ED doors to deliver a patient who’s suffered a life-threatening illness or injury and requires attention — STAT.
Health systems make sure that ED clinicians have the necessary tools to make quick diagnoses and provide the care patients need as soon as possible.
Decisions in the C-suite aren’t made that quickly, but executives still need the right tools to make the best decisions. Unfortunately, that’s where many health systems falter.
To measure the financial performance of a healthcare organization, thousands of data points are required. But a recent survey showed that 15% of organizations don’t use financial benchmarking. Another 41% expressed dissatisfaction with how performance benchmarking guides their decision-making.
Cost transformation ranks as a significant or very significant need among 86% of healthcare executives, especially as consumerism and value-based payments become more prevalent. Nearly two-thirds of healthcare organizations aren’t using consumer-centric data scorecards to manage performance or are using them only on a limited basis.
Additionally, one-half of healthcare executives say their ability to report cost and profitability metrics and trends is limited. In many cases, organizations lack the data, analytics, and tools to drive cost improvement.
Strategic comparisons of performance can help a health system more fully understand the financial state of operations, its performance against itself and other organizations, and how to meet future challenges.
Health system financial executives should take these three tips to heart.
1. Timely data is better data
Timely access to robust comparative data is critical, especially when 95% of healthcare finance leaders feel increased pressure to pinpoint how financial results impact business strategy. But when comparing their organizations to others, most hospitals and health systems use enterprise-level data that’s 9 months to 2 years old — much too outdated to effectively compare performance across the organization. And sometimes, specific peer-level benchmarking data is not available.
This time lag and inability to view competitor data make it impossible to provide context to the numbers by comparing performance internally and against organizations of similar size and type. Data from both internal and external sources should be captured monthly, not just quarterly or annually. Data should compare financial performance across the organization and with peers—by region, state, hospital, department, bed size, and more.
Access to timely, robust comparative data empowers executives to identify improvement opportunities and drive action in as close to real time as possible.
2. Reevaluate the KPIs used to measure success
Determining the most appropriate key performance indicators (KPIs) is a critical first step toward measurable performance improvement. For example, unique patient growth and the average wait time between scheduling and completing an appointment are two common benchmarks of whether a provider is creating a consumer-centric experience. Yet three-quarters don’t assess in-office wait times, a metric that can quickly erode patient satisfaction. Just 14% measure “purchase loyalty,” the share of total healthcare dollars a patient spends with the provider organization.
Understanding your organization’s performance at this level requires focusing on the right metrics at the right time. It also necessitates sharing data across the organization, not just with senior leaders but also with front-line staff who can directly impact results. Receiving relevant data on a regular basis gives staff pride of ownership and the sense that their actions can move the needle on performance.
3. Single-source data platform powers better decisions
Using a single-source data platform for comparative analysis brings consistency across all reports, both internal and external. It also ensures the right information is communicated to the appropriate stakeholders — from the CEO on down — at the right time.
The ideal platform will integrate data from various sources into a single repository for planning, analysis, and reporting. This approach supports real-time decision-making and sustainable improvement.
But an organization that considers its performance alone neglects the tightening competitive landscape. By comparing their performance to similar-sized hospitals or local competing hospitals, organizations can uncover any weaknesses and identify opportunities to optimize financial success while delivering quality care.
While healthcare leaders don’t need to make decisions with the speed of an ED physician, access to timely data intelligence on meaningful KPIs could mean the difference between surviving and thriving in an intensely competitive market. The time is now to ramp up comparative analysis capabilities for next-level performance.