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Tefen USA Forecasts Top 10 Healthcare Challenges in 2008

Posted on: Tuesday, 13 November 2007, 09:01 CST

NEW YORK, Nov. 13 /PRNewswire/ -- From better management of the Emergency Department to more efficient use of medical equipment, from serving waves of aging baby boomers to more productively scheduling healthcare staff - those are among the top ten healthcare challenges facing hospital administrators in 2008, according to management consulting firm Tefen USA.

"More than ever, hospital administrators will be in the hot seat next year, as they cope with new Medicare reimbursement rules, difficult staffing issues and growing cost control requirements," explained Barry Calogero, President, Tefen USA. "In our day-to-day work alongside our hospital and health system clients, we have a first-hand view of the difficult business issues they face everyday."

According to Calogero and his team of U.S.-based healthcare consultants, here are the top ten operational challenges of 2008 and how the firm expects healthcare administrators to address them:

1. Emergency Department 'State of Emergency'- Chronic overcrowding in Emergency Departments will reach a fever pitch, with wait times hitting unsupportable levels. Administrators will focus renewed attention on relieving chronic overcrowding in the Emergency Department as patient dissatisfaction grows dramatically higher. Among the solutions they will increasingly employ: creating specialized treatment centers for non-urgent patients. 2. Reaching Nursing Critical Mass - To combat chronic shortages of healthcare professionals in nursing, providers will seek innovative ways to schedule their existing personnel to maintain the right staff, at the right level, at the right time. Improving all support systems to free nurses up to allow them greater focus on patient care will be examined in many institutions. 3. Baby Boomers: On the Cusp of an Explosion - As waves of baby boomers enter their sixties, provider organizations will ferociously compete to meet their healthcare needs and prepare for the dramatic increase in demand for healthcare services as a result of the demographics of this aging population. In 2008, many health systems will invest in new facilities expressly designed for baby boomers that sport well appointed private rooms. Budgets for oncology, cardiology and orthopedic departments will grow - all driven by the desire to capture "market share" of the 78 million Americans born between 1946 and 1964. 4. Healthcare Reform Dominates the Debates - The need to reform the healthcare system will heat up dramatically as the country seeks a new leader. Americans without insurance will accelerate to 50 million by the end of 2008 and to over 56 million by 2013. In 2005, healthcare costs in the U.S. were $2 trillion and are expected to grow to $2.9 trillion, a rate twice that of inflation. Issues will include universal coverage, tort reform, drug prices, competition, and healthcare IT. 5. Performance Improvement Initiatives Hit the Mainstream - Maximizing equipment and minimizing waste will become the universal mantra of hospital administrators. While early adopters have leveraged proven Lean Six Sigma principles in recent years, a major wave of adoption of streamlined delivery, ordering and utilization systems will result in the achievement of efficiencies by institutions across the country. 6. Impact of Defensive Medicine Strains All Hospital Resources - Studies have shown that over 90% of all physicians engage in defensive medicine, with 59% often ordering unnecessary procedures and tests. These behaviors are motivated by fear of litigation and conservative medicine. Additional studies have shown a 5-9% reduction in healthcare spending (>$100 billion/year) as a result of reducing physician liability with no quality impacts. As capacity continues to be constrained, many institutions will begin to standardize practice patterns around best professional standards. Tort reform and incentive-based compensation will be explored to enable mandating the use of these best practices. 7. Greater Calls for Transparency - From pricing to performance, all types of hospital data will be scrutinized by CMS, private insurance companies, employer organizations and patients themselves. In 2008, hospital administrators will increasingly be publicly judged. And hospital boards will become far more active in monitoring institutional performance and removing administrators who fail to meet stated goals. 8. Unfettered Rise in Inductions and Cesareans Continue to Stress Inpatient OB Practices - The number of induced births and C-sections will continue to increase in many cases driven by the desire for convenience among both patients and obstetricians and liability issues. For hospital administrators, however, this trend will create challenging daily operational issues resulting from slower patient turnover and limited bed availability. By the end of 2008, with the national cesarean birth rate rising by 4-5% per year, this will result in a cesarean birth rate in 2008 approaching 35%, with some hospitals eclipsing the 50% rate. This increase is driven primarily by scheduled births, defensive medicine, and severe drop in VBAC (vaginal birth after cesarean). Systems will put a heightened effort to improve operational performance as patient satisfaction in OB takes a direct hit from these capacity constraints. 9. "No Pay for Poor Performance" - New rules issued by CMS (Centers for Medicare & Medicaid Services) will begin to be widely felt in 2008, with reimbursements increasingly denied for care associated with "reasonably avoidable" complications. The impact on some financially strained hospital systems will be devastating. To cope with the new rules, hospital executives will increasingly embrace quality management systems, while trying to anticipate "what's next" in terms of other CMS rules aimed at reducing the cost of care. 10. Fixing the Weak Links in Supply Chains - Bloated inventories, hoarding, and outdate/ manual ordering systems continue to impact quality of care and service levels. Typical targets will include Strategic Sourcing, Supply Standardization & Substitution, and Simplified Distribution Processes to free up critical nursing resources and improve performance. Hospitals will give renewed attention to supply chains to reduce cost and improve service levels, as this is the lever that can be pulled requiring the least amount of culture change with the biggest immediate impact.

According to Calogero, all of the above challenges require close attention by hospital administrators. "By using tools traditionally associated with manufacturing, such as Lean and Six Sigma, we work alongside our clients to carefully analyze each situation and to develop an efficient, sustainable solution based on their needs."

About Tefen

Tefen Ltd. is a leading international management consulting firm that specializes in helping organizations achieve performance excellence. Since its founding in 1982, the company has served some of the world's largest and fastest growing businesses, while acquiring a strong reputation as a cost efficient, nimble consulting partner. From strategy through to implementation, Tefen creates value by optimizing the competitiveness, reliability, and agility of its customers. With its hands-on approach philosophy, the firm has achieved tremendous success in delivering quantifiable and value-driven results. Headquartered in Israel and employing over 300 consultants worldwide, Tefen also has offices in Europe and in the United States.

About Tefen USA

Tefen USA is a subsidiary of Tefen, a global management consulting firm founded in 1982. The company focuses on driving performance excellence to achieve improvements in cost, quality, and service delivery. Tefen USA supports a variety of industries and has worked with many Fortune 500 organizations. Tefen partners with clients to build quantified cases for change, setting themselves apart by working with clients from strategy through implementation to achieve sustainable results.

Tefen USA

CONTACT: Yvonne Liu of Tefen USA, +1-646-652-8275, yliu@tefen.com; orMelissa Connerton of CooperKatz & Company, +1-212-455-8001,mconnerton@cooperkatz.com, for Tefen USA

Web site: http://www.tefen.com/

Source: PRNewswire

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