Performance Management Of Hospitals And The Role Of Consultants

In any organization, including hospital, performance management or rather performance enhancement can be achieved only when problem areas / internal loop-holes are adequately addressed. These problem areas are not always noticed as they are masked under routine tasks. More often than not, these issues are brought to the notice of the hospital manager / hospital administrator, when it has already reached its boiling point and has affected several other related areas as well. In such situations, the role of the hospital administrator is more of a fire-fighter than anything else.

This is just like the frog and the hot water experiment, where, being in the same environment; the frog does not realize the gradual increase in the temperature until it is too late to escape. Similarly, in hospitals, we often keep following the same unbecoming ways that we fail to notice the flaws in. The realization occurs only when it’s too late.

Hence, the role of hospital operations management consultant becomes necessary for managing the performance of hospitals because of the outside perspective that they bring to the table. The role of the hospital manager, no doubt, is to improve performance; however, they find themselves restricted on time and resources. Moreover, many a time, performance can be better evaluated from the outside than being in the system. This results in an un-biased and objective opinion and is also better received by the hospital staff as it is being recommended by an expert. Enlisted below are a few areas where hospital operations management consultant can work alongside a hospital manager leading to improved performance management of a hospital.

Service utilization and occupancy is one of the prime areas of focus for effectively managing the performance of hospitals. Hospital consultants can critically evaluate the productivity and utilization of major services in the hospital and also compare these with industry benchmarks. Since, they are aware of the pulse and the trend of the industry, hospital consultants can draw parallels and inferences based on their experience at different hospitals

Financial Performance Analysis is the core of the business and therefore requires detailed attention. The key indicators of the financial performance of the hospital go beyond numbers and ratios. Hospital consultants dig deeper than these numbers to identify profit centers and cost centers for the hospital. Furthermore, the service-wise revenue distribution and contribution of each department is evaluated, studied and compared with industry benchmarks. Similarly, the distribution of expenses is also compared to optimize it as per industry standards. A hospital operations management consultant also views the financial health of the hospital in relation with the tariffs set by the hospital and their costing. Different revenue-augmenting and cost-containment methods can then be applied to optimize the profitability of the hospital.

Turn-around strategies and business advisory is another area where hospitals engage with consultants. The role of the hospital administrator is to manage day-to-day operations and also help the senior management with strategizing. Strategies for business operations, business development and performance enhancement are required to be as per market needs, industry trends, appetite of the hospital and should be tested for robustness and effectiveness. The hospital consultant can work hand in hand with the hospital management on these.

Stake-holder engagement includes engagement with clinicians, para-medics, administrative and other staff, TPAs, Corporates, patients and the society at large. This stake-holder engagement needs adequate strategizing and implementation in order to bring in the desired results. The involvement of consultants during discussions with top stake-holders results in establishing a more professional and thoughtful setting that is conducive to both parties.

Process optimization and man-power utilization are performance enhancers for hospitals. At times, some of the processes and Standing Operation Procedures are not conducive to the operations of the hospitals and therefore negatively impacts the performance. Similarly, under-staffing, over-staffing and inadequate resource allocations also results in poor performance. Hospital operations management consultants can suitably review the processes and manpower allocation at hospitals with the objective to boast performance.