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Healthcare Analytics are Not Standard…..Yet

Every hospital in the country is maximizing their use of advanced healthcare analytics to improve operational and financial efficiency.

Wouldn’t it be nice if that statement were completely true? In some aspects, most hospitals use a form of analytics, but many do not use it to the fullest capabilities.

In this economy, hospitals are facing the same pressures as other types of businesses. Healthcare systems have slimmer margins, but the same demand for profitability while battling increasing costs, decreasing revenue streams, and more regulatory requirements. Given this, it is understandable that hospitals are skeptical of advanced analytics.

Despite the recent BI frenzy in healthcare, predictive analytics is still said they are using BI, and the majority said they still learning how to use it” (Terry). While 46% doesn’t seem that small, more than half of those said they are using “analytic modules embedded in their electronic health record/hospital information system,” while “less than a quarter of the BI users had purchased ‘best of breed’ solutions.” This approach may work locally, but hospitals will eventually need to increase efficiency on a larger scale.

As a hospital decision maker you may question the usefulness of advanced healthcare analytics. However, larger institutions that are ahead of the curve have already started pilot programs that can increase savings for hospitals of any size.

Robert Wood Johnson University Hospital in New Brunswick, NJ, has been lauded for its 50 physician pilot program that improved average length of stay (ALOS) by 8% and average cost per case by $276. By using advanced analytics, physicians were able to aggregate existing data to create a web-based user interface that showed them comparative performance data. According to Joshua Bershad, MD, MBA, senior vice president of medical affairs and CMO, “The interface allows physicians to view data – such as how many patients they have in the hospital, what their conditions are and the severity – in a ‘recognizable and searchable’ format”(Merrill).

Another example of recent cost control aided by advanced analytics is Danbury Hospital in Danbury, CT, which was honored for its diagnosis-related group (DRG) cost efficiency project. The project focused on high-volume DRG’s such as congestive heart failure, stroke, pneumonia, psychosis, etc. According to Matthew Miller, MD, chief medical officer at Danbury Hospital, “The hospital saw a $2.9 million charge reduction for these eight areas and reduced overall charge-per-case by 10 percent.” Furthermore, when the hospital looked at medical DRG’s and all related diagnoses, the charge reductions totaled $6 million. Based on the data that it provided, physicians were “able to identify areas where they could reduce variations in care and still improve quality” (Merrill).

The improvements in efficiency at Robert Wood Johnson and Danbury Hospital due to healthcare analytics are clear. To take advantage of these decision-making resources, hospitals need only to understand the costs are well worth the reward. Improving patient care while maintaining profitability is the goal of every hospital and healthcare system. With analytics that deliver real solutions, this is becoming a standard, not just a reality for the healthcare industry.

Merrill, Molly. “Hospitals Recognized for Physician Partnerships.” Healthcare IT News. N.p., 02 June 2011. Web. 01 Oct. 2013. .

Terry, Ken. “InformationWeek: The Business Value of Technology.” Information Week. N.p., 11 Sept. 2013. Web. 01 Oct. 2013. ..

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