Doing more with less may be a business cliché, but it barely begins to cover the test that teams at Penn State Health have faced recently. Begun as a single hospital affiliated with Pennsylvania State University, the system formed in 2014, creating a multihospital system that has been on an acquisition path over the past several years. It now includes four medical centers and two medical groups in central Pennsylvania. An additional hospital is opening in the fall of 2022, employing some 16,800 people, with further expansion in the works.
Supporting rapid growth amid the industry-wide imperative to cut costs has challenged Tracy Williams, vice president of finance, far beyond what’s typical for her role. For instance, an analysis indicated that Penn State Health would have needed to add approximately forty-four full-time back-office employees per hospital without an aggressive standardization and automation program. Instead, the back-office head count—including finance, human resources, and supply chain specialists—per location has remained flat as a result of the system investing in technology.
Like all of her peers, Williams and her team have scrambled to make do with limited resources. “We had to figure out a way to be more efficient by default,” she says. “It’s not like there was a highly organized strategic effort to improve efficiency.”
The Impact of Standardization
A switch to standardized reports has been crucial to Penn State Health’s productivity gains in finance. “We now present a piece of information one way instead of multiple ways,” Williams says. For example, metrics such as financial performance of individual business units or labor distribution statistics appear just once on a standard report for all users. In the past, that information appeared in different places within reports customized for various users.
“We have trained users to come to a single source as opposed to creating a source for each user’s interpretation,” Williams says. She notes that when these changes were first implemented there was some resistance. “But when we show how much work effort is saved, typically they come on board,” Williams says. “People just don’t like change initially.”
Medical System Consolidation
Williams is now in the midst of an ambitious plan to convert sixteen separate electronic medical records solutions to a single system within the next five years. Implementation has begun at one site and will slowly roll out to all Penn State Health facilities. The work can be arduous for IT personnel and requires significant financial and labor investments, including engaging the consulting firm Grant Thornton on the project.
Switching EMR and revenue cycle platforms will challenge users, Williams acknowledges. “The transition can be painful for physicians,” she says. “If they are working in both a clinic and a hospital at different locations, they may have to use two EMR systems in the interim.” That can be clunky and confusing at times. Despite any frustrations they may have, however, providers support the effort—in fact, they will drive its success. They realized that the need for doctors to circulate through multiple care sites makes a standardized system a requirement for efficiency and quality of data, Williams says.
The efforts Willliams has made on behalf of Penn State Health stand out to her colleagues. “Tracy is such an innovative force in healthcare,” say Principal Christopher Baratta and Partner Michael Sorelle of Grant Thornton. “During her time at Penn State Health she has overseen growth and promoted efficiency and excellence. It has been a pleasure to work with her throughout the years.”
Boosting Reimbursement Rates
In addition to simplifying record keeping, standardization will improve the bottom line by better aligning patient care with insurance reimbursement standards. “Reimbursement rates could improve because we will be more likely to hit our quality targets through consistency and data integrity aligned with standardization,” Williams explains.
A new decision support tool with standardized data sets will make a big difference. Previously, expenses associated with patient care were recorded differently at each location. In effect, each location had its own way of compiling statistics such as cost per patient for varying treatments.
“Our goal in the near term is to have more reliable direct data on cost per patient,” Williams says. “Then we can start a conversation with a providers and vendors related to standard products and care practices. Let’s say their patient population is staying in the hospital six days longer for a condition than average. We can say to them: ‘what can we do to help you discharge these patients on time?’”
Migrating to a single EMR system will also enable multiple providers to better coordinate care for each patient. “We want patients to have a seamless experience that will be easier to achieve when using a single system,” she explains.
A Holistic View
Indeed, to reap the benefits of consolidating multiple organizations under one brand, Penn State Health has to become a well-coordinated whole. For example, there are opportunities to improve the way labor is deployed across sites.
“We are doing more to contain costs in real time instead of by hindsight,” Williams says. “In the future, we are going to be able to compare daily indicators marrying them to industry benchmarking.”
Viewing the system as a whole rather than piecemeal, Penn State Health can move personnel from site to site as needed to better match supply with demand. This applies to technicians, physicians, and other professionals. “It’s a more holistic approach to managing people, which is 60 percent of your P&L,” Williams says.
All this work to standardize reports, consolidate systems, and improve efficiency is going to be even more critical over the next few years as Penn State Health continues to grow. “We’ve got a new hospital scheduled to open in October 2022,” Williams says. “And there are more practices hoping to align with Penn State Health.”
The remainder of the decade will likely continue to challenge Williams and other organizational leaders. As healthcare transforms, departments that support clinical work must be agile enough to adjust to new regulatory environments.
“Things seem to change so fast that right after you adapt, you are already behind,” Williams says. She’s ready to keep adapting even faster, though.