Where many different processes are combined within the same system, they interfere with each other, creating bottlenecks and multiplying the costs of coordination.
Standardization and the rigorous use of care pathways are critical methods for controlling the utilization of high-cost tests and medicines and reducing unnecessary variation. Indian providers have found that keeping costs lower through standardization allows them to rapidly expand access and generate adequate profit. Standardization facilitates a smooth flow of patients, reducing costs from errors, staff down time, delays for patients and the amount of inventory that needs to be carried. This is easier where there is a focus on a narrow range of patient types, activities, procedures or diagnostic groups.
While economies of scale are difficult to find in healthcare, there do seem to be very significant diseconomies of complexity. Where many different processes are combined within the same system, they interfere with each other, creating bottlenecks and multiplying the costs of coordination. This is one reason why focus is a helpful strategy. Where this is not possible, it is a good idea to protect programmable activities like elective surgery by separating them from more complex areas of work, such as emergency or specialist care.
Care pathways are an effective tool to ensure care is delivered in the right place, at the right time and to the right standard. The appropriate use of advanced directives and plans for the end of life (to avoid futile treatment), and the use of predictive models to trigger anticipatory care (for example to identify patients at risk of readmission), can contribute to containing the cost per person in any health system. A key use here is to establish a set of expected actions for each day of inpatient stay to be actively managed with escalation plans if things go wrong. Plans and pathways are also useful in patient education, peer support and the role of support workers – all important aspects of low-cost systems.
Our case studies from India place a great deal of emphasis on standardization of building design, room layouts, treatment pathways, equipment, prescribing and a number of areas where physicians have usually expected much more autonomy. LifeSpring hospitals in India maintain standardized management protocol for more than 90 procedures to maintain consistency in treatment quality. There are scheduled training sessions focusing on customer relationships and care for all employees. Protocol adherence is measured across hospitals to monitor compliance with over 100 processes. This indicator has shown a steady increase indicating consistency in compliance and adherence to quality.
Many systems have sought economies of scale which have often proved elusive. Our research suggests it may be more profitable to pursue ‘economies of flow’ – moving away from batching and queuing to a focus on removing blockages and constraints. This can reduce waste, the need to deal with defective processes and remove non-value adding steps. There are some design principles to help here:
The literature and our case studies all conclude that a focus on improvement underpinned by a methodology, including lean, is essential and important to ensure this is understood and used by frontline staff.