Why the Health Care Industry is Taking a Hard Look at How People Work

Sponsored by West Monroe Partners

A convergence of forces from regulation to consumer advocacy to cost controls is transforming the face of health care. Existing players and new entrants are disrupting traditional delivery models and driving change in how health care organizations provide services. A prime example is Amazons recently announced collaboration with Berkshire Hathaway and JP Morgan Chase to change health care for employee groups.

Additionally, these forces are driving a consolidation of players a trend very much evident in Seattle through transactions such as Kaiser Permanentes acquisition of Group Health and the recent announcement of merger talks between Providence St. Joseph Health and Ascension Health. Even organizations that choose to remain independent are engaging in new types of collaboration to build presence and economies of scale.

A key piece of the equation is ensuring your workforce is enabled to be as effective as possible. Inefficient health care operations not only increases costs, it effects employee engagement, patient experience and perception of value. It also makes it harder for organizations to pivot their operations to capitalize on new opportunities.

To compete effectively in a changing market, health care organizations will need to better understand and then refine the way their people work. This type of analysis has been key to transformation in other industries, such as retail and financial services. Now, health care organizations are beginning to realize the importance of measuring and managing work to ensure their highly-skilled workforce are positioned to create value.

Why the renewed focus on the way people work?

Rapid industry change and continued pressure on premiums necessitate a more detailed quantitative understanding of the organization and its operations. Several trends make it all the more critical to focus in on the work people do.

While industry consolidation has enabled economies of scale, the rush to combine often produces organizations that have ill-defined, redundant, or sub-optimal roles that have not been sufficiently updated or upgraded for the new structure. Activities and actions often get lost in the shuffle of consolidation and may now be hiding in some surprising places for example, tasks that prevent people in senior level roles from contributing maximum value or activities that are automated in one location but performed manually in others.

While the industry is consolidating, health care job growth continues to outpace many other sectors and projections indicate that will continue. According to the Bureau of Labor Statistics, health care industries and their associated occupations are expected to account for a large share of new U.S. jobs projected through 2026. In its 2017 Employment Projections report, the Washington State Employment Security Department cited health services and social assistance as one of the states largest expected growth sectors between 2015 and 2025.

The accelerating use of technology to digitize and automate operations for example, mobile apps that enable patient self-service or robotic process automation tools that replace certain human tasks is also increasing the mandate to analyze health care roles. While technology has improved efficiency, increased access to data, and brought other benefits to health care delivery, too much technology added to a process or role (application sprawl) can actually have an adverse impact on efficiency if not managed well.

Additionally, organizations often dont give sufficient attention to people and process changes when using new technology to automate a process, affecting their ability to realize the full benefits of automation. Understanding activities at a greater level of detail can yield quick wins and low-cost opportunities to improve and standardize processes.

Finally, increasing complexity in the health care market makes it harder to assess pricing and profitability. In order to produce accurate assessments, an organization will need to conduct comprehensive analysis of specific activities to understand the true cost of delivering services.

Without better insight about how people spend their time, it will be difficult for health care organizations to position themselves to react quickly, decisively, and with solid quantitative grounding to make strategic moves and counter-measures against disruptive influences.

Quantifying work

Quantifying work typically involves the following steps:

1. Identify the activities/processes completed by specific roles.

2. Consider the organizations goals and determine which of the above activities add value or differentiate the organization and which dont.

3. Measure the activities on which people spend time and how much time they spend performing those activities. There are several ways to do this, including direct observation or self-tracking mechanisms.

4. Use data from the measurement exercise(s) to quantify the cost of specific activities and determine the extent to which an activity does or does not add value.

5. Evaluate ways to minimize non-value-added activities and allow more time for value-added activities that employees could be doing. This usually involves improving processes by automating, centralizing, streamlining or standardizing activities.

Call centers often measure and analyze the types of calls received and use that insight to improve operations and optimize agent roles based on their skills. In a health care context, this might result in re-directing low-value contacts (Am I covered? or What is the nearest doctor/hospital I can visit?) to self-service channels so that representatives are freed to assist patients/members with the most complex health issues and help them find the best care for the lowest cost. One way to extend this type of analysis might be to analyze calls received by doctors offices and develop a strategy for shifting certain types of contacts to the call center or self-service channel.

Few health care organizations, however, have systems that track work performed outside of their call centers, providing little insight to no insight about how others in the organization spend their time. In particular, higher-cost and more senior roles such as actuaries and analysts are also often the lowest-visibility roles. Yet these roles often represent significant opportunities to eliminate inefficiency and increase productive work. For example, because many organizations data resides in siloed systems, actuaries or analysts often spend an inordinate amount of time collecting, standardizing, and cleaning data in order to use it to perform their jobs.

Studying time spent on data preparation can help pinpoint automation solutions that will free actuaries or analysts to spend their time using insights drawn from the data to improve care models or adjust risk models so that the organization can target patients most in need of help, ultimately reducing cost of care.

Vital insight for operating in a changing market

Regulation, disruption, and economic uncertainty will all have a strong bearing on health care market dynamics over the coming year and years. Organizations that can model scenarios accurately, plan effectively, and identify and react to strategic opportunities in a timely manner will be those best positioned to navigate and succeed in an evolving marketplace.

We have seen health care organizations realize significant benefits from better understanding the work people do, particularly at more senior levels of the enterprise. With this insight, management teams can relieve administrative burdens and utilize senior resources more effectively. Not only does this improve productivity and enable strategic goals; it also typically increases job satisfaction, which in turn brings the benefits that come with an engaged workforce, such as improved retention and better customer service. This analysis also enables management teams to quantify the true cost of products and services more accurately today, an increasingly critical prerequisite to pivoting operations and keeping pace with changing health care delivery models.

Vishal Yadav (above) is a senior manager in West Monroe Partners Healthcare & Life Sciences practice, based in Seattle, Washington. Contact Vishal at [email protected]

Alex Wyatt (above) is a Senior Manager in West Monroe Partners Workforce Optimization practice, based in Seattle, Washington. Contact Alex at [email protected].