8 kinds of waste driving healthcare costs

There's a tremendous amount of waste occurring in the healthcare industry. In order to address that waste, organizations are moving to lean management because it exposes what and where these wastes are and rethinks the way work is done via value streams.

Most providers are set up by departments, or vertical silos. In the case of manufacturing, it's products that traverse these departments, from receiving an order to collecting the money for it. In healthcare, what traverses departments are the patients.

Tracking patients horizontally through a healthcare value stream changes the way you think about what's value-added and what's not said Marc Hafer, author of the book Simpler Healthcare and CEO of Simpler, a firm globally dedicated to lean application, techniques and transformation in healthcare. "When you reconstruct patient flow through an experience at a clinic and you think horizontally... that's when you see all the waste there really is," he said.

Hafer shared with Healthcare Finance News the eight different types of waste that inhibit patient flow, add cost, increase poor quality and infection and decrease patient and clinician satisfaction. "When you remove waste, all these things change for the better," remarked Hafer. "The value-added stream method is fundamental for patient flow in healthcare organizations."

1. Transportation

Transportation is entirely non-value-added. "It contributes nothing to patient care. It adds to delays and increases likelihood there will be defects and dissatisfaction," Hafer said. Transportation includes moving patients from one department to the next, shifting supplies and equipment and moving instruments from sterile processing areas to the OR and back again – and even when patients travel to and from the actual hospital itself.

2. Inventory

Inventory can include pharmaceuticals, supplies, and patients, too, if you consider a waiting room in a hospital. The replenishment system should be based on use as opposed to some forecast. "Only what's needed when it's needed is a good approach with inventory," Hafer said.

3. Unnecessary motions

Reaching, bending, twisting, turning. These motions are all ergonomic issues abundant within healthcare. Clinicians are injured because processes like transporting a patient from wheelchairs to beds aren't designed ergonomically. Staff takes time off for rehabilitation when unnecessary motions incapacitate them, which can result in a loss of productivity and enhance overall costs.

4. Waiting