"We realize there is only so far we can go [with labor and supplies] so we are looking at other areas that might be big picture areas as far as utilization, evidence-based medicine, blood utilization, and we're really trying to work with the medical staff to get that alignment around those cost reduction areas," Thibodeaux says.
J. Thomas Jones, president and CEO at West Virginia United Health System in Fairmont, says he and his executive team are looking to their best clinical performers for ways to trim utilization throughout the system.
"What we are concentrating on now is really finding in each of our system's hospitals what produces the best outcomes at a lower cost and how we get buy-in across the system to do it the same way in every system hospital," Jones says.
Michael Rowan, executive vice president and chief operating officer at Englewood, CO-based Catholic Health Initiatives, agrees that physician utilization should be a key area of focus, especially because his organization is moving to risk-based payer contracts in which high utilization of expensive resources could result in financial penalties.
"We're big on trying to get focused on the clinical side... to manage utilization and clinical variability," Rowan says. "We also need to address and prepare ourselves so we don't get into short-term thinking. If we look at a typical patient and how much outpatient diagnostic testing they get, we haven't evolved from thinking of it as revenue to thinking that it is an expense. We've got enough markets and enough contracts out there where those things really are expenses now, and so we have to look at how we make that mindset shift."