Mid Coast Health Services

Engagement Summary

Multiple improvement projects in the hospital and healthcare system spanning several years.

Project examples include:

Operating Room Supplies:

A Director of Materials Management wanting to reduce costs in the hospital surgical services department hired Lean Healthcare East Principal Steve Musica to lead a Lean project team. The cross functional team (including a Surgeon, Nurse, Scrub Technician, Sterilization Coordinator, Nursing Director, and Materials Management Buyer) . worked together to review background data and create value stream maps of the ordering, stocking, consuming, and replenishing surgical supplies processes.

Background data showed that 34% of stocked items had no usage in the past year while 31% of the items were stocked at levels higher than the established maximum levels in the system. Cancelled cases were only avoided due to several employees making herculean efforts to keep surgeons in business and overcome the failing process.

The team identified goals for improvement and the root causes of issues. A new process was mapped out to convert the paper based inventory system to an online system, allowing material replenishment and billing to be done more quickly and accurately. The operating rooms began using the new system with full participation and actively decreasing the obsolete and inactive items.

The team reduced inventory by over $100,000 in the first three months, reduced the lead time for replenishment by 24 hours, and also reduced nursing and materials management staffing required for ordering and stocking.

Pharmacy Improvements: 

Lean Healthcare East was asked to help a pharmacy department increase the efficiency of inventory processes to reduce $80,000 annually in expired medicine, improve delivery to inpatient nursing, and improve staff morale.

The department head formed a team that included pharmacy employees of various job functions and a nurse to represent the customer. Lean Healthcare East value stream mapped the processes for filling orders and refilling stock medicine to help the team identify the eight wastes. Lean Healthcare East then led the team on an A3 project to identify root causes for issues and identify the wastes to eliminate.

In solutions implementation, the team adjusted times of delivery to better meet nursing and staffing needs and implemented an improved system for stocking and replenishing drugs. The team focused efforts on the 1% of drugs that resulted in more than 50% of expired product and set a goal of reducing expired product by half, saving at least $40,000 annually. Implementing a two bin (kanban) system for kitted parts simplified replenishment and reduced customer lead time and stock-outs.

The team better learned the entire process of delivering drugs and what their customer really needed, improving morale and teamwork.

Imaging Voice Recognition Improvements:

Lean Healthcare East joined a project team (including staff leaders in Medical Records, Information Technology and Diagnostic Imaging) to advise on implementing voice recognition software to reduce diagnostic imaging transcription costs. Software had been identified by Information Technology staff that forecasted a five year payback on capital costs to purchase and implement the software.

Lean Healthcare East Principal Steve Musica noted that the team was uncertain of the proposed solution, and led the team through an A3 problem solving process. The process began by establishing that the project goal was primarily for cost savings. Mr. Musica had the team examine cost drivers to confirm if the voice recognition software was the proper solution to the root cause(s) of high cost. Through root cause analysis, the team soon realized that the high costs were primarily due to the transcription department’s structure and performance.

A solution was proposed that would outsource transcription to a third party vendor, whose lower fixed costs would reduce overall charged costs. The vendor also had capabilities to move to voice recognition technology and further reduce costs without the need for capital investment by the hospital. Transitioning to a third party vendor was chosen as the solution that best addressed the cause of the high costs and was estimated to save the small hospital over $200,000 annually. Implementation included transitioning hospital transcriptionists to the third party vendor’s team to minimize any negative effects to staff and culture.

Client testimonial

“Steve has facilitated performance improvement teams for departments including Surgical Services, Diagnostic Imaging and the Pharmacy. He has helped us identify wastes and cut costs. He is a teacher and coach that uses a proven process for his projects and stresses that good things will happen when you put the patient first. We have asked Steve to support our performance improvement efforts and Triple Aim initiatives in the coming months. I highly recommend Lean Healthcare East and Steve for healthcare improvement.” – Lois Skillings, President and CEO, Mid Coast Health Services

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