Factory lessons put to use at Seattle Children's hospital

Two years ago, the supply system at Seattle Children's hospital was so unreliable that Susanne Matthews, a nurse in the intensive-care unit, would stockpile stuff — catheters in the closet, surgical dressings in patients' dresser drawers and clamps in the nurse's office. And she wasn't the only one.

"Nurses get very anxious when we can't get our hands on the tools we need for our patients," Matthews says, "so we grabbed them when we saw them, and stashed them away." This, in turn, made the shortages more acute.

On a busy day last month in the ICU, it took Matthews just a few seconds to find the specialized tubing she needed to deliver medicine to an infant recovering from heart surgery. The tubing was nearby, in a fully stocked rack, thanks to a supply system instituted by the hospital early last year using practices typically found in manufacturing or retailing, not health care.

There are two bins of each item; when one bin is empty, the second is pulled forward. Empty bins go to the central supply office and the bar codes are scanned to generate a new order.

The hospital storeroom is now half its original size, and fewer supplies are discarded for exceeding their expiration dates.

The system is just one example of how Seattle Children's says it has improved patient care, and its bottom line, by using practices made famous by Toyota and others. The goals of the approach, known as kaizen, are to reduce waste and to increase value for customers through continuous small improvements.

Manufacturers, particularly in the auto and aerospace industries, have been using these methods many years. And while a sick child isn't a Camry, Seattle Children's has found that checklists, standardization and nonstop brainstorming with front-line staff and customers can pay off.

"It turns out the highest-quality care also is the most cost-effective because we make fewer mistakes and create better outcomes," says Patrick Hagan, the hospital's president.

The program, called "continuous performance improvement," or CPI, examines every aspect of patients' stays at the hospital, from the time they arrive until they are discharged, to see what could work better.

Cost savings

Last year, amid rising health-care expenses nationally, CPI helped cut Seattle Children's costs per patient by 3.7 percent, for a total savings of $23 million, Hagan says. And as patient demand has grown in the last six years, he estimates the hospital avoided spending $180 million on capital projects by using its facilities more efficiently. It served 38,000 patients last year, up from 27,000 in 2004, without expansion or more beds.

Similar methods are now in place at other hospitals and health systems, including Beth Israel Deaconess Medical Center in Boston, Park Nicollet Health Services in Minneapolis and Virginia Mason Medical Center, also in Seattle.

So many others have sought advice that Seattle Children's put together a two-day workshop, presenting it to more than 200 medical workers and health-care leaders from the United States and Europe.

"Some people think they have to choose between quality of care and saving money," said Dr. David Chand, who attended the training and now uses CPI methods at Akron Children's Hospital in Ohio. "CPI improves both patient outcomes and the hospital's bottom line."

To increase the number of surgeries the hospital could perform, Chand's team spent about $20,000 overhauling the process to sterilize instruments, avoiding a $3.5 million expenditure to expand that department. More efficient scheduling in the MRI department reduced the average waiting time for nonemergency MRIs from 25 days to 1 or 2.

All medical centers, especially larger ones, would have significant return on investment by using techniques like CPI, says Eugene Litvak, chief executive of the Institute for Healthcare Optimization and an adjunct professor at the Harvard School of Public Health.

"The health-care industry could be on the verge of an efficiency revolution, because it is currently so far behind in applying operations-management methodologies," Litvak says.

Not everyone believes factory-floor methods belong in a hospital ward.

Nellie Munn, a registered nurse at the Minneapolis campus of Children's Hospitals and Clinics of Minnesota, thinks many of the changes at her hospital are inappropriate. She says in an effort to reduce waste, consultants observed her and her colleagues to try to determine the amount of time each of their tasks should take.

But procedure times can't always be standardized, she says. For example, some children need to be calmed before IVs are inserted into their arms, or parents may need more information.

"The essence of nursing," she says, "is much more than a sum of the parts you can observe and write down on a wall full of sticky notes."

On June 10, Munn helped lead a one-day strike by the Minnesota Nurses Association against six local health-care corporations, including her employer, partly in protest of lower staffing levels her union thinks have resulted from hospitals' "lean" methods.

"We felt the cuts created an unsafe environment for patients," she said. The nurses' contract was settled July 1, with no increase in staff levels.

Brian Lucas, a spokesman for Children's Hospitals and Clinics of Minnesota, says the lean efforts have reduced unnecessary tasks and not lowered nurse-to-patient ratios. "To the contrary," he said, "they have allowed nurses to spend more time delivering care to patients."

Techniques such as CPI may indeed be hard for many hospitals to put into effect, says Mark Graban, a senior fellow at the Lean Enterprise Institute, a nonprofit research, education and publishing company.

The process takes much time and requires a culture shift that many hospitals may not be able to accommodate or sustain. "If the leadership tries to force new ways of doing things, the staff may chafe under the successive changes," he says.

Not making a car

And George Lebovitz, a management professor at Boston University, says there are limits to performance-improvement methods in hospitals. "Human health is much more variable and complex than making a car," he said, "so even if you do everything 'right,' you can still have a bad outcome."

Physical layouts can also interfere with changes that hospitals want to make, such as reducing the distance a chemotherapy patient has to walk. And the techniques can fall short of their potential if they are used in just one area of a hospital because a patient typically moves through many different departments.

At Seattle Children's, Dr. John Waldhausen, the division chief of pediatric general and thoracic surgery, acknowledges he and other doctors weren't initially enthusiastic about CPI because they thought it would take some decisions about patient care out of their hands.

Over time, he changed his mind, and he is now a vocal advocate of CPI. "When you look closely, CPI is the same scientific method we learned in medical school, including hypotheses, data collection and analysis," he says. "It is not opinion and conjecture — it is data-driven."

Ten years ago, Seattle Children's set a goal to become the top hospital of its type in the country. It hired Joan Wellman & Associates, a consulting firm in Seattle, to help it get there. Wellman, who had worked with Boeing on its lean-manufacturing processes, suggested the hospital apply similar principles.

Hagan says he became enthusiastic about lean manufacturing and CPI after doing research and visiting local manufacturers. He directed the hospital staff to examine the "flow" of medicines, patients and information in the same way plant managers study the flow of parts through a factory.

In a typical workshop at Seattle Children's, a group of doctors, nurses, administrators and representatives of patients' families set aside a 40-hour week to work through CPI methods. They plot each "event" a patient might encounter — such as filling out forms, interacting with certain staff members, having to walk various distances or having to wait for assistance — and brainstorm about how each could be improved, or even eliminated.

Program rollout

The hospital staff has been rolling out the program in stages over the last decade. "We have probably made over 1,000 small changes, and frankly it never ends," Hagan says.

In his CPI training, Dr. Bryan H. King, director of the department of psychiatry and behavioral medicine, was one of the first Seattle Children's staff members to visit Japanese manufacturers. He learned that "waste" could be viewed as any action that didn't add value to the customer.

Turning to his psychiatric inpatient unit, he and his team worked to pinpoint the goal of each child's stay and to communicate daily with families. They also made other changes, for example, starting to arrange outpatient resources as soon as children enter the unit, rather than waiting until they are ready to leave.

These kinds of changes increased families' satisfaction ratings and helped cut the average hospital stay from 20 days to 10. The unit can now accommodate 650 children a year instead of 400.

Changes celebrated

Changes like these are celebrated by the hospital administration. "Their support fosters the idea that everyone can make positive changes to their departments," King said.

Standardization is also a CPI cornerstone. Last year, 10 surgeons at Seattle Children's performed appendectomies, and each doctor wanted the instrument cart set up differently. The surgeons and other medical staff members used CPI to come up with a cart they all could use, reducing instrument-preparation errors as well as inventory costs.

Dr. Lynn D. Martin, director of the anesthesiology and pain-medicine department, says changes previously were instituted only when existing systems failed. Using CPI, teams can now make changes any time they think they can improve a process. When the operating-room team saw a tonsillectomy procedure involved filling out 21 separate forms, it sat down with the print vendor to remove duplications — and cut the number to 11.

The staff doesn't have to wait for the perfect solution, Martin says, just a better one, because they can "keep making improvements year after year."

Using CPI, the hospital has reduced the waiting time for many surgeries from three months to less than one. Recently, the bottleneck was not the surgeons' time, but a lack of available inpatient beds for recovery.

Examining the hospital's census, administrators saw that there were empty beds on weekends. They realized by scheduling more surgeries on Fridays, patients could recover over the weekend. The change also benefited parents and patients who would miss fewer work and school days.

Logjam broken

Lack of space in the recovery room was another logjam, and the hospital planned a $500,000 renovation to enlarge it. But a CPI team saw that if a child's parents went to a common waiting room during surgery, instead of an individual recovery room, more surgeries could be scheduled.

Parents were given beepers to alert them when their child would arrive in the recovery room — and maps and colored lines on the walls helped point the way.

In the hospital's largest CPI project yet, Lisa Brandenberg, the chief administrative officer, used the method to design a new $70 million clinic and surgical facility in Bellevue.

Medical buildings often have standard benchmarks — basing the number of examination rooms, for example, on the expected volume of patients.

Brandenberg and her team instead used CPI to map out common paths that patients, staff members, supplies and information would flow through. They worked in an empty office building, using cardboard mock-ups of surgical sites, recovery rooms, anesthesia areas and waiting rooms. Fifty staff members then play-acted various scenarios to test the design's effectiveness.

The final design reduces walking distances and waiting times for patients by grouping related facilities together and creating rooms that can be used for more than one purpose.

The hospital was able to shave 30,000 square feet and $20 million off the new building, which opened in July.