How Analytics Could Put A Big Dent In Rising Healthcare Costs

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In 2015, the total healthcare spend in the United States was estimated at $3.2 trillion – or almost 18% of the nation’s gross domestic product. Healthcare costs in the U.S. continue to soar.

There seem to be no easy answers to resolving what many people believe is a growing crisis in this country. But there are a couple of obvious places to start.

Sources cite that as much as 30% of the healthcare spending per person in the U.S. is wasted as a result of factors such as unnecessary services, excess administrative costs, and inefficient care delivery.

For some health systems, like St. Louis-based Mercy, advanced analytics are already helping to eliminate some of that waste and drive down costs.

Eliminating Waste

Mercy is comprised of more than 40 hospitals, hundreds of clinics, and over 40,000 employees. Collectively, these resources serve millions of people each year across four states.

And Mercy wants to continue caring for its patients as efficiently as possible.

“We’re looking at opportunities to reduce some of the waste that exists in healthcare. And we can do that with good data and analytics,” says Sheila Tod, Mercy’s Vice President for Lab Excellence in a recent video. Tod, who is responsible for ensuring excellence at Mercy’s more than 70 lab locations, gives a specific example that is close to home.

“Our vision is to deliver the right test, at the right time, at the right place,” Tod says. “We saved over $800,000 by eliminating some of the point-of-care testing in the emergency room.”

As an industry, the savings potential is enormous. Experts estimate that at least $200 billion is wasted annually on excessive testing and treatment. And the benefits extend beyond the monetary. Over-treatment can actually cause patients needless pain and suffering in some cases.

Boosting Efficiency

“Using real-time data and analytics allows us to identify best practices across our network and spread them to help improve patient efficiency across the entire organization,” says Dr. Fred McQueary, M.D., Mercy’s President of Ambulatory Care & Chief Clinical Officer.

This includes boosting resource efficiency in the critical perioperative services that cover the duration of a patient’s surgical procedures at Mercy.

“Technology in the perioperative arena is very important. We are one of the most technology-driven service lines in the hospital,” adds Betty Jo Rocchio, Vice President of Perioperative Performance Acceleration at Mercy. “We’ve improved our block utilization by 12%, which helps us get patients into the OR in a more efficient manner and get their surgical needs taken care of.”

Analytics is not a new trend at Mercy. In fact, this not-for-profit healthcare organization has been recognized by the American Hospital Association health forum as a “most wired” health system more than a dozen times in recent years.

Today, Mercy relies on a solid IT backbone that includes technology such as  predictive analytics, business intelligence solutions and in-memory computing. The various healthcare service lines collaborate with Mercy Technology Services (MTS) to unleash the power of these analytics solutions.

Not Just a U.S. Phenomenon

The expanding use of intelligence tools in healthcare is certainly not limited to the United States. In fact, it’s been reported that the global market for clinical intelligence software is expected to grow 12.5% between 2017 and 2023.

And why not? The benefits are clear.

“We’ve been able to see some really great savings through efforts driven by data.” says Curtis Dudley, Vice President of Integrated Performance Solutions at Mercy. “But the ultimate benefit to patients around having analytics is that we have better care and lower costs.”

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To watch these videos to learn more about how Mercy is improving patient care and reducing costs.

 

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