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Shortsighted financial decisions damage patient experience

January 14th, 2014

by Anthony Cirillo

I have spent a lot of time in hospitals recently as my sister was diagnosed with an aggressive lung cancer.

One observation that should be of no surprise - you wait and you wait and you wait. That has been the experience of care for her in two different hospitals in the Melbourne, Fla., area over the holidays. Waiting--an extra hour beyond when your pain medications are due. Waiting--more than an hour after your respiratory treatment was due.

Make no mistake. The staff is apologetic and overworked. Without saying it in words, they know delays impact care, outcomes and ultimately patient experience. And they are quick to volunteer the reason why--understaffing.

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At the very point when you need care most, there is understaffing. It is the same woeful cry in long-term care.

Sitting here as a healthcare consumer and caregiver for my sister and mother, it's hard to believe the industry cannot provide a better nurse-to-patient ratio, especially since the nursing shortage has abated. Of course, administrators will cite financial pressures--at a time when margins are growing and CEO salaries are through the roof and under scrutiny. I don't have to work in the industry to see this. I see the end result--my sister in pain.

Penny wise. Pound-foolish. I am seeing more and more healthcare decisions made solely as a shortsighted financial consideration.

Only recently we lost a bid for patient experience work. Did we cost more? Yes. Did we offer incredible value for the cost? Yes. We even had a major clinical leader in patient experience as a partner.

Yet, the decision-makers were more concerned about putting us into a matrix to boil down the decision by the leadership team to a financial one. They even went as far as telling us our proposal, and those of our competition, would be read by only two of the 16 decision-making members.

Exasperating and shortsighted, and here's why.

Attention to patient experience has rewards beyond HCAHPS scores and the finances associated with it. For example, Press Ganey recently released information showing a direct correlation between better experience scores and fewer readmissions. That impacts $280 million in readmission payments.

Pearson and Porath, in their book, "The Cost of Bad Behavior: How Incivility Is Damaging Your Business and What to Do About It," report the impact of negative behaviors and poor communication among team members to one organization with 10,000 employees is $71,000,000.

Patient experience indirectly drives profits. J.D. Power reports hospitals scoring in the top quartile in satisfaction had more than two times the margin of those at the bottom. Another study of 51 hospitals found that approximately 30 percent of the variance in hospital profitability can be attributed to patient perceptions of the quality of care.

As a colleague of mine told me, hospitals want quick and cheap fixes to improve their scores and the reality is cultural change takes time and money and hardwiring of tactics.

I'm reminded of a great scene in the movie "Christmas Vacation" when Clark's boss explained to his wife why he did not give financial bonuses that year. He said what looked good on paper was not so good when you see how it affects the "little people."

Sitting here as a little person, and often a helpless one at that, I wish in this New Year that administrators would look beyond the initial financial implications of their decisions and instead consider that what might cost you more initially will reap incredible benefits down the line, not only financially but also in brand value and word of mouth. After all, as I said in Hospital Impact last month the experience of care is the marketing.

Anthony Cirillo, FACHE, ABC, is president of Fast Forward Consulting, which specializes in experience management and strategic marketing for healthcare facilities. He also is the expert guide in Assisted Living for About.com.

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