1. The Health Roundtable ABF Success Factors Presenter: Dr Craig Margetts Hospital Code Name: Various Innovation Poster Session HRT1215 – Innovation Awards Sydney 11 th and 12 th Oct 2012 1 4-4c_HRT1215-Session_MARGETTS_TBA_QLD

2. The Health Roundtable KEY PROBLEM  Avoiding the healthcare management pendulum  From Finances and FTEs (about 5 years)  To Quality, Quantity and Qualifications (about 5 years)  How to have both and foster a clinically-driven management approach from the coal-face up?  How to avoid “reporting-up fatigue” from constant additions to reporting requirements  How enhance collaboration between  Clinicians  Clinical Managers  Executive Managers 2

3. The Health Roundtable AIM OF THIS INNOVATION  To implement reporting process designed around:  Clinicians (who did not plan to be accountants)  Department/Division/Facility/Health Service goal alignment  Identifying opportunities to eliminate waste  Providing detailed advice to assist in external target negotiations  Aligning Clinical, Quality and Business goals  As a by-product  Improving clinician understanding of business requirements  Improving business understanding of clinical priorities  Providing long-term financial, quality and business stability 3

4. The Health Roundtable BASELINE DATA  4 organisations with budgetary and clinical-business challenges: Organisation FinancialRevenueCasemixActivityAccess Alfred Group of Hospitals Royal Darwin Hospital Albury Base Hospital Mackay Health Service District 4

5. The Health Roundtable KEY CHANGES IMPLEMENTED  6 Key Strategies (to compliment Quality / Pt Safety Initiatives): Organisation Job Code Budgets Pt / Unit / Division P & L Dep’t Flex Budgets 3-level OPD referrals MonSta Report DetailedA ctivity Budgets HRT bench- marking Alfred Group of Hospitals Royal Darwin Hospital Albury Base Hospital Mackay Health Service District 5

6. The Health Roundtable KEY CHANGES IMPLEMENTED  Job Code Budget development  Detail, Detail, Detail – Signed off by each CC manager in person  By Cost Centre, Job Code, Pay Type and Month  Expressed as FTEs, Hours, $ and %  With routine reporting to match (including staff names)  Patient/Dept/Division P&L (Margin Analysis)  Regular reporting (monthly) to Clinical Divisions regarding  Variable Contribution Margins  Fixed Contribution Margins  Overall Margin  Ownership & Clinical Engagement to100% once information and concepts were understood (data quality improved dramatically) 6

7. The Health Roundtable KEY CHANGES IMPLEMENTED  Departmental Variance Reporting & Analysis  Comprehensive suite of variance analyses:  3- Level OPD referrals  Template in GP software saves time and increases compliance  Default is Bulk-Billing Clinic to a named specialist (level 2)  Opt out to “Public” (level 3)  Opt out to “Chardonay”-Private clinic (level 1) GL Variance Utilisation (Variable) LabourLabour SuppliesSupplies OtherOther PricePrice EfficiencyEfficiency ProductivityProductivity Leave (VSH) OvertimeOvertime RatesRates Activity Variance IP Volume IP Mix Controllable by Dept Mgr Fixed Costs LabourLabour SuppliesSupplies FacilitiesFacilities OtherOther Indirect Costs 7

8. The Health Roundtable KEY CHANGES IMPLEMENTED  Detailed Activity Budget Development  Detail, Detail, Detail – Signed off by each CC manager in person  By:  Department/Division,  Inpatient/Outpatient, Elective/Emergency (IP), New/Repeat (OP),  Triage Category/OPD Referral Category/Waiting List Category  Month  Expressed as Patient/Client numbers, Weighted Seps/OOS  With routine reporting to match (including staff names)  Monthly Statistical (MonSta) Report from each Department  Single monthly report required to management from clinicians  Template to facilitate interpretation of routine reports  Move focus from Problem Identification  Problem Resolution 8

9. The Health Roundtable OUTCOMES  4 organisations with budgetary and clinical-business challenges: Organisation FinancialRevenueCasemixActivityAccess Alfred Group of Hospitals Royal Darwin Hospital Albury Base Hospital Mackay Health Service District 9

10. The Health Roundtable LESSONS LEARNT  Detailed budgeting takes time, but ensures clarity of goals  Financial & FTE  Clinical: Quality, Access, Activity  Reporting BACK to executive is equally as important as providing reports down to managers  All formats must be in lock-step:  Budget Format  Routine Reporting (down) format  Routine Reporting (up) format  Clinical and Organisational Aspirations, Goals and Targets  It takes 10 reporting cycles of BELIEVED information to make a difference… 20 to make lasting change 10