Senior Vice President,
In most hospitals, clinical processes encompass only 10-30% of the total processes. Non-clinical or back office processes make up the balance. Within this area lies an opportunity to dramatically decrease costs and increase efficiency through the adoption of alternative business models. Genpact’s Smart Enterprise Processes (SEPSM) is a unique methodology that enhances the efficiency of a hospital and enables it to deliver safe and high quality healthcare.
Genpact’s key hospital Clients
While the first two waves of improvements in the healthcare industry were led by technology and pharmaceutical development, the third wave has largely been focused on using technology to manage and use information. Healthcare providers have embraced these changes, albeit slower than in most industries, but are yet to realise the full potential of the ‘Process’ dimension which can account for up to 70% of all hospital activities.
The processes deployed by healthcare providers have undergone very few changes as they remain relatively untouched by the tools and techniques, successfully used in other industries to drive efficiency and effectiveness. However, healthcare has different levels of complexities and non-deterministic flows which make process optimisation tougher.
In most hospitals, clinical processes encompass only 10-30% of the total processes. Non-clinical or back office processes make up the balance. Within this area lies an opportunity to dramatically decrease costs and increase efficiency through the adoption of alternative business models. The hospitals are unable to leverage their full potential and true value – the “Hidden Hospital” – which can be unlocked by applying the correct tools and methods to their individual processes.
Genpact, a global leader in business process and technology management, has introduced a new, proprietary methodology called Smart Enterprise Processes (SEPSM). This methodology enables continuous improvements in specific business processes across different industries by leveraging multiple tools like Lean, Six Sigma, IT, accumulated pool of knowledge and benchmarks. It makes the improvement process very deterministic instead of a discovery exercise.
The industry needs an alternative business model, which can positively impact financial and operational issues. Genpact leverages its proprietary scientific methodology, SEPSM, with a focus on improving processes between departments across three workflows: patient flow, supplies flow and cash flow.
Visit-to-Cash (V2C) SEP covers the entire cycle from the time a patient visits for a treatment to a hospital ultimately receiving the payment. V2C processes include:
Challenges faced by hospitals
The Indian healthcare system faces some significant challenges:
- Insufficient capacity
Hospitals are experiencing severe capacity constraints which affect service quality, physician and patient satisfaction. The problems range from the lack of available beds, to Emergency Room (ER) overcrowding, to an increasing nursing shortage and delays in patient care. These problems constrain a hospital’s ability to develop new patient services and enhance revenue streams.
- Sub-optimal operational performance
Hospitals focus on improving departmental level efficiencies in delivering quality patient care. This siloed approach leads to multiple hand offs, inefficient use of infrastructure and can have potential patient safety issues.
- In-effective cost and material management
Issues such as overstocking and high stock of expiring and unused medicines, multiple points of storage and inability to track actual consumption add to a hospital’s challenges.
- Sustaining performance
The lack of standard measurement systems to track performance of hospitals also impacts efficiency levels. Even in the best run hospitals, data and metrics are used only to diagnose past issues and not to predict and proactively tackle potential issues related to patient experience and safety.
Typically hospitals address the above challenges by:
- Building new hospitals and expanding existing infrastructure
- Deploying more resources – physicians, nursing staff, equipments and technology
- Increasing inventory levels of medical and non-medical supplies
- Providing relevant medical training and financial incentives
These solutions are capital intensive, possibly one time solutions and not always easily implemented.
The current challenges demand nothing less than a fundamental rethinking of hospital operations to improve outcome, increase capacity and meet the growing demand of users. The industry needs an alternative business model, which can positively impact financial and operational issues.
Unlocking the Hidden Hospital
Genpact leverages its proprietary scientific methodology, Smart Enterprise Processes (SEPSM), along with proven Six-Sigma and Lean practices to deconstruct end-to-end hospital processes into three horizontal workflows (Fig 1)- with a focus on improving processes between departments:
- Patient flow
- Supplies flow
- Cash flow
This horizontal end-to-end approach improves business outcomes by optimising these flows across hospital departments utilising a combination of delivery platforms. This enables a hospital to consistently deliver safe and high-quality healthcare.
Applying SEPSM in hospitals:
- Delivers P&L identifiable impact using a tested and non-intrusive
- diagnostic and delivery mechanism leading to increased revenue and margins and improved working capital
- Identifies and builds a roadmap for a best-in-class organisation by linking granular level processes to critical business outcomes
- Provides measureable improvements in a short time span by simple yet scientific tools and methods
- Standardises processes and procedures leading to significant improvements in the areas of care quality, cost-effectiveness and patient satisfaction
Some examples of how processes can be improved across the V2C cycle (Fig 2) include:
- Stitch-to-Cut cycle times impacting surgical suite availability can be improved by 4-6% in 90 days by improving the patient flow process
- Patient walk times can be reduced by 20% by optimising process flow and ergonomics
- Pharma and non-pharma stock levels can be reduced within the first 90 days to prevent overstocking without impacting care-giving processes
- Overall supply costs can be further optimised by 8-12% by moving from physician preference items to standardised supplies
- Expiration of medication and obsolescence of supplies contribute 1-3% of operating costs of wards and can be reduced by 30% in 90 days
- Potential exists to improve First Time Right in Billing by up-to25-30% by fixing avoidable and manageable root causes
- Payer denials can be significantly reduced by fixing upstream processes like patient referral systems
Genpact has been implementingSEPSM methodology in the Indian healthcare industry with considerable success (Fig 3). The focus is on driving process effectiveness across departments by measuring leakages at each level of the end-to-end workflow and applying best-in-class benchmarks and practices.
SEPSM has proven to be an effective tool in developing and implementing a continuous improvement blueprint of hospitals’ key processes.
The Road Ahead
As the healthcare sector reinvents itself, it is clear that survival will now depend on not doing more of the same, but viewing challenges differently and applying newer paradigms to how hospitals are structured to deliver care. Hospitals will have to move from departmental ‘silos’ to ‘value flows’ and process thinking is going to be the most important lever for hospital CEOs. SEPSM has proven to be an effective tool in developing and implementing a continuous improvement blueprint of hospitals’ key processes. This allows hospitals to focus on clinical excellence, while being able to get maximum efficiency from support functions. It shifts the focus from managing in silos to managing processes that can be resilient and delivers sustained results.
SEPSM Delivers Business Impact