The healthcare sector's rapidly evolving landscape demands an efficiency that transcends mere buzzwords. It requires a robust survival strategy, particularly in specialized fields like ophthalmology.
When I founded Shafer Vision Institute (SVI), I swiftly recognized that every resource, especially fiscal ones, must be leveraged optimally to establish a sustainable practice. This realization became the bedrock of our lean operations approach, a paradigm shift that has significantly bolstered our efficiency and patient care quality.
The essence of lean operations
Lean operations can be defined as “a systematic approach to identifying and eliminating waste through continuous improvement by flowing the product at the pull of the customer in pursuit of perfection.”1 In a medical practice, succinctly put, it is about achieving more with less.
At SVI, lean operations mean streamlining processes to minimize overhead—cutting out the fluff and focusing on what truly adds value to our patients and our practice. This involves eliminating redundancy and embracing cloud-based, interconnected services, optimizing staff roles, and maintaining a lean payroll. It’s a conscientious approach to working smarter, guaranteeing every process and policy propels us toward our core goals.
This approach is sometimes misconstrued as cost-cutting at the expense of quality. However, I want to make it abundantly clear that lean operations are not about undercutting staff or skimping on patient care. It's about equitable remuneration and cultivating a workplace where every individual—from receptionist to physician—feels integral and empowered.
It requires me, as the practice owner, to be integrally involved in all aspects of our operations, affirming that every task, regardless of its nature, is vital.
5 key components of lean operations in an ophthalmology practice
There are five key components that are critical to establishing lean operations: defining value, mapping the value stream, finding flow, implementing the pull principle, and consistent improvement in the pursuit of perfection.2,3 Each plays an integral role in reaching the end goal of a streamlined operation that generates patient satisfaction.
Defining value
The first step is to establish the value of an item or service based on what the consumer is willing to pay for a particular product. This often involves market research to determine precisely what a specific target customer (or, in our case, patient) expects from a product (diagnosis and/or treatment) and its delivery to deem the price acceptable.
Mapping the value stream
In this second step, the aim is to eliminate all extraneous activities that do not contribute to the value established in step one. Therefore any processes that do not enhance the actual product or preferred delivery of it can be considered “waste” and should be eradicated to reduce time and cost. The remaining processes can be referred to as “value-adding” production steps.
Finding flow
This step entails making sure the necessary processes—identified through mapping the value stream—flow seamlessly from one to the next in the most efficient manner by adjusting when, how, and by whom each is performed.
Identifying and implementing the pull
To put the “pull principle” into play, one must first identify how much of a product your customer desires and the time frame in which they expect to receive it. Production is pulled by the customer’s expectations.
By working backward using this metric, only the necessary materials and labor are utilized. Excess inventory and labor are both reduced, as the end goal is to provide the precise quantity required on the earliest date expected.
Committing to consistent improvement
The goal of every organization should be producing and delivering a perfect product—or in the case of ophthalmology, optimal patient care. With the previous four steps in place, it is time to instill this commitment toward consistent improvement in every staff member and every process.
This involves regularly starting back at step one and working through each subsequent step to keep the forward momentum toward perfection.
The 8 principles of lean operations in healthcare
When the above principles are adapted and applied to the healthcare industry, it results in “lean healthcare.”
In lean healthcare, the organization assesses every step in how treatment is provided and engages every member of the team—from physicians, nurses, and technicians to front desk, operations, and administrative staff—to find ways to eliminate waste, reduce costs, and streamline processes all with the ultimate goal of increased patient care and satisfaction.4,5
Figure 1 illustrates the eight principles of lean healthcare.
1. Minimize common mistakes.
As the pay-for-performance (P4P) model is being introduced into healthcare—which financially incentivizes performance—it is becoming even more important to make certain every member of a practice is fully dedicated to minimizing defects in processing, diagnosis, and treatment.
Examples of common mistakes are surgical errors, prescribing problems, misdiagnosis, preventable allergic reactions, and incorrect coding and billing. Mistakes cost time and money in each phase, including the creation of the original defect, righting the wrong, and assessing why it happened.
Therefore, it is paramount to prioritize eradicating mistakes before they happen by having a workflow in place with checks and balances.4,5
2. Whittle down wait time.
Time waiting is time wasted, be it by a patient, a technician, or a physician. To avoid this form of waste, the key is to monitor the average time spent by patients in the waiting room, at the front desk, in examination, and checking out.
In conjunction, monitor staff downtimes and note when one member is consistently waiting on a particular person or project before they can complete the duty at hand. Using the knowledge gained, create a workflow that ensures time is used most efficiently. Reduced wait times are key to patient satisfaction.4,5
3. Eradicate excess inventory.
When a surplus is identified in any area of a practice supplies—be it medical, office, or waiting room—that qualifies as excess inventory and should be decreased. Excess inventory can be a piece of equipment that is gathering dust, a stockpile of a particular medication, or piles of pre-printed forms that will likely never be used.
It can also be a surfeit of data that is no longer relevant. Regardless, to embody a lean mentality, each team member should be vigilantly on the lookout for ways to eradicate excess inventory to mitigate financial loss, storage shortages, and general waste.4,5
4. Perfect the patient flow.
Patient flow encompasses both the movement of actual patients and of supplies/equipment. When either of these things is transported inefficiently, it results in a waste of time and energy.
Exam rooms should be equipped with all of the supplies needed for the patient encounters that occur there, including dyes and drops, diagnostic tools, and imaging machines. In an ophthalmology setting, this could also mean having portable point-of-use technology instead of having to move a patient from room to room for treatment.4,5
5. Avoid overproduction.
In a nutshell, overproduction is creating more than is needed, especially for an individual patient. This waste is most common in hospitals and larger medical facilities, but can affect practices of all sizes. In an ophthalmology office, this could come in the form of ordering medications or diagnostic tests that go unused.4,5
6. Radically reduce over-processing.
Over-processing refers to the act of making patient procedures and care more complex than they should be by adding extra steps, collecting duplicate information, or over-ordering testing.
Examples include performing several—or more complex and expensive—tests when one simple test could accurately assess, having different employees gather and enter the same data, having overqualified individuals perform tasks that could be completed to full satisfaction by another staff member, or prescribing a surgical treatment when a medical alternative is equally efficacious. Ultimately, lean analysis focuses on reducing redundancies.4,5
7. Enhance ergonomics.
By definition of Merriam-Webster dictionary, ergonomics is “an applied science concerned with designing and arranging things people use so that the people and things interact most efficiently and safely.” Motion waste occurs when clinicians and staff must perform more movements, reach further, or take extra steps to accomplish a task.
At its worst, this can lead not only to wasted time, but employee or patient injury. To remedy this, practices must be strategic in their placement of supplies, layout of exam rooms, and design of the overall space. When configuring an office or health center, each employee's workflow should be considered.4,5
8. Harness human potential.
When any of the above forms of waste are at play, it results in an inefficient workplace, which often leads to employee frustration, job dissatisfaction, and undue exhaustion—which diminishes performance.
Ideally, each member of the practice or organization should be able to fulfill their maximum potential, which includes working at their maximum level of licensure, having the opportunity to share their particular level of expertise, and leveraging their talents.4,5
A lean healthcare culture nurtures physicians and staff to fully utilize their unique skill sets to optimize patient care.
Tailoring lean operations to ophthalmology
The unique cadence of an ophthalmology practice, which oscillates between clinical and surgical settings, provides fertile ground for lean principles. On days away from the clinical frontlines, our staff flexes their skills across a spectrum of tasks, from administrative duties to direct patient care and marketing initiatives.
This versatility not only ensures productivity remains high but also creates a dynamic work environment. The practice thrives on the ability of our team to pivot seamlessly between roles, a testament to the value of cross-training.5,6
The tangible benefits of lean operations
Embracing lean principles yields palpable benefits:6
- Financial agility: By trimming the fat, we become more adaptable, able to nimbly respond to the ebb and flow of market demands.
- Employee enrichment: Our team is not pigeonholed into single-function roles. They are multi-skilled, which enhances their career satisfaction and growth.
- Enhanced patient experience: Patients relish the continuity of care as they interact with a cohesive team across their healthcare journey, forging a deeper, more personal connection with the practice.
Utilizing streamlined, integrated services
To underpin the efficiency of our operations, SVI relies on cloud-based, integrated systems. In the past, disjointed practice management (PM) and electronic health record (EHR) systems created a fragmented workflow. We have sidestepped these complications by adopting Modernizing Medicine as a unified platform for practice management, EHR, revenue cycle, payment processing, and reputation management.
Rather than five different disjointed systems, Modernizing Medicine handles all of these functions for us, reducing redundancy and eliminating transcription errors. In effect, revenue cycle management is optimized, and money flows in more quickly. This integration is a cornerstone of our efficiency and a delight to work with.
Overcoming the challenges of lean operations
Expanding the scope of staff responsibilities is not without its hurdles. Employees accustomed to specialized roles may find the broader spectrum daunting. We address this with comprehensive training, mentorship, and a culture that views mistakes as learning opportunities.
It's about fostering resilience and improving our collective performance, rather than pointing fingers when something goes awry.
Implementing lean operations in an ophthalmology practice
It starts with hiring
The journey to lean operations starts with the first team member you bring on board, who must be a standard-bearer for your vision. This cornerstone member plays a pivotal role in mentoring new additions.
Starting with a core group capable of executing essential tasks such as patient intake, communication, and surgical coordination is key. Streamlining services and judicious use of independent contractors simplify HR demands and keep the focus on core competencies. Instead of hiring W2 employees, utilizing independent contractors can keep payroll down.
The advantage of cross-training
Cross-training has been a boon for SVI, enhancing our patient services. It's not uncommon for the same staff member who welcomes a patient to guide them through the entirety of their visit, establishing trust and a unique personal touch that sets our practice apart.
Financial benefits
Though services like Modernizing Medicine come with an initial investment, they pay dividends by shrinking long-term operational costs. This strategic choice directly bolsters our net profits and underpins the cost-effectiveness of lean operations, fostering an environment primed for growth and scaling. To be specific, when starting SVI, I had to make the decision whether I would hire an in-house biller or outsource to Modernizing Medicine.
While the hourly rate for in-house billers on a W2 may vary by state, the mean yearly salary is around $50,000 per year. Additionally, there are associated payroll taxes, benefits, and human resources (HR) hassles associated with full-time equivalents (FTEs). Not to mention the training!
Conversely, with Modernizing Medicine’s billing service, BOOST, I simply pay a percentage of billing collections for an entire team that handles the claim scrubbing, sending out to the Clearinghouse, denials, electronic remittance advice (ERAs), and electronic funds transfer (EFT).
I would have to bill over $1 million in claims to match the salary of a single biller, and by the time a practice is busy enough to be doing that much in collections, it is typically time for a second person. Therefore, utilizing ModMeds’s billing service, I am able to streamline claims while minimizing redundancy and payroll. This is what lean operations are all about!
How to measure success in an ophthalmology practice
We assess the impact of lean operations through the prism of patient and staff satisfaction, the more quantifiable metric of profit margins. The variance between gross and net profits clearly indicates our operational prowess.
Scalability has revealed that a successful practice need not be overly dependent on increasing human resources.
Relevant resources on lean operations in healthcare
- Lean Transformations: When And How To Use Lean Tools And Climb The Four Steps Of Lean Maturity by Thijs Panneman
- Streamlining Health Care Operations: How Lean Logistics Can Transform Organizations by Audie G. Lewis
- The Lean Healthcare Handbook: A Complete Guide to Creating Healthcare Workplaces (Management for Professionals) by Thomas Pyzdek
- Applying Lean in Health and Social Care Services: Improving Quality and the Patient Experience at NHS Highland by Cameron Stark and Gavin Hookway
- Applying Lean Six Sigma in Health Care: A Practical Guide to Performance Improvement by Thomas K. Ross
- Lean Daily Management for Healthcare by Brad White
Conclusion: Building a future-proof practice
In summary, adopting a lean operations framework lays the groundwork for a scalable, patient-focused, and efficient ophthalmology practice. It assures staff contentment and positions us to embrace growth and technological evolution.
Artificial intelligence (AI) and emerging technologies herald a new era of enhanced operational streamlining, ensuring that SVI remains at the forefront of patient-centered ophthalmic care.
Lean operations are the embodiment of our commitment to excellence, efficiency, and growth. This strategic approach is not merely about survival—it's about thriving in the fast-paced, ever-competitive world of healthcare.
