Introduction and Overview
Healthcare organizations must continuously develop new ideas and concepts to promote efficiency and cost effectiveness at all levels of operations. This is achieved through the creation of new process methods which may require additional employees but will create an even greater return on investment in the future. These efforts are critical in shaping healthcare operations in a favorable manner. The focus of this business proposal will support the development of a process method which is designed to reduce surgical errors, improve efficiency, and expand the quality of patient care in perioperative settings. The Surgical Time Out (STO) will be considered as a means of improving outcomes, reducing errors, and enhancing revenue capabilities for healthcare organizations which seek to optimize their surgical operations. This method will be implemented in the surgical suite so that errors are reduced and any incidents involving wrong patient or wrong procedure no longer exist.
The proposed process method will be designed to expand revenue capabilities within healthcare organizations. To be specific, the perioperative environment is in need of continuous innovation and support to reduce errors and to promote efficiency in the surgical unit. This is best accomplished by using various assessment methods to clearly identify patients, the procedures that they will receive, and that they are ready for surgery. As part of this evaluation, post-surgical complications must also be considered and must reflect cost effective techniques at the time of the procedure and during follow up, including any patient education that is required during this process. These standards meet the criteria of STO service and are endorsed by a number of relevant organizations, including the Occupational Safety and Health Administration and the Association of Perioperative Registered Nurses (Alpeter, Luckhardt, Lewis, Harken, and Polk Jr., 2007). In addition, this process method is likely to increase the potential for income generation during the post-surgical process and should be evaluated according to its costs versus its benefits in providing optimal surgical care and treatment to patients to avoid complications. A prior study using STO methods indicated that there were a number of clinical benefits to this practice, which led to a cost savings of approximately $900 per patient during hospitalization (Backster, Teo, Swift, Polk Jr., and Harken, 2007). This figure demonstrates that it is important to develop a method that will reduce expenses for each surgical patient and that will also improve cost effectiveness over time (Backster et.al, 2007).
The proposed revenue stream for an STO implementation is summarized in the following hypothetical financial statement:
|Total Budget||STO Methods||Clinical Information System Integration||Excess Funds Acquired from Donors|
|Salaries and Wages||$675,000||4,129||$163,589||$22,984|
|Employees pension plan||$246,952||$15,983||$2,600||$249,531|
|Taxes for payroll||$135,000||$826||$32,718||$0|
Cost per Unit
Based upon the financial statement, the integration of STO methods into the perioperative suite at a cost of $54,452. This cost will include salaries and wages, travel, supplies, telephone costs, and other expenses which will contribute to the integration of these methods into daily practice settings. It is important for the hospital to evaluate these costs of setting up the perioperative suite with STO methods and to determine if the benefits of this method will outweigh the costs of setting the method up and in maintaining it for long-term use. This is an important opportunity to evaluate the current conditions of the perioperative suite and to determine which areas require enhancements so that the cost of high quality care is not compromised and patients are not placed at unnecessary risk due to errors that could have been prevented if this method was in place. It is known that the average cost for an abdominal surgery is approximately $5,000; therefore, if STO methods were in place at a given organization, there is a greater likelihood that this cost would double to approximately $10,000 since there would be significant room for error in conducting these surgeries (Altpeter et.al, 2007). With the latter example, the additional costs would be attributed to anesthesia care providers and other related costs (Altpeter et.al, 2007).
Charge/Price per Unit
For each unit that is equipped with STO methods, it is important to recognize that some of the costs of implementation overlap across different surgical units, including implementation costs. These costs are incurred and are applicable to all implementations of the STO method at an organization. However, since each surgical suite will be equipped with the STO method, each unit will have a budget of its own, which will include supplies, salaries and wages, benefits, travel, equipment maintenance, and telephone charges, amongst others. The annual budget for each surgical suite will be consistent across all suites and will accommodate the STO implementation and ongoing upkeep of this method. This budget will account for all costs which are associated with the STO implementation and continued operation.
Historically, the Centers for Medicare and Medicaid Services (CMS) do not reimburse hospitals for any costs that are associated with Wrong Site, Wrong Procedure, and Wrong Patient mishaps (AHRQ, 2012). Under these conditions, the hospital cannot obtain reimbursement when the doctor and/or clinical staff is at fault in performing the wrong surgery on the wrong patient (AHRQ, 2012). To be specific, the CMS states the following position regarding wrong patient, wrong surgery: “The Centers for Medicare and Medicaid Services (CMS) has determined that when a practitioner erroneously performs a particular surgical or other invasive procedure that was intended for a different patient on a Medicare beneficiary who does not need that procedure, Medicare will not cover that particular surgical or other invasive procedure because it is not a reasonable and necessary treatment for the Medicare beneficiary’s medical condition” (CMS, 2009). There is a reasonable expectation by the CMS that physicians and clinical staff members will attempt to eliminate as many errors as possible and that if these errors occur, reimbursement will not take place (CMS, 2009). However, when reimbursement is appropriate, the correct code must be provided and should be documented accordingly to submit to the appropriate insurance provider. The government or other insurance provider dictates which expenses are reimbursable and which ones are not according to a set of reimbursement codes, each of which reflects a different procedure, technique or method. Documentation must be provided to request reimbursements at all times (CMS, 2009). Based upon these observations, it is important for surgical teams to demonstrate precise accuracy as best as possible with the intent to eliminate errors so that all reimbursement requests are appropriate and will be approved by the CMS as requested. The CMS and many other nationally recognized organizations take these mishaps very seriously and do not believe that any costs that are attributed to the failure of a surgeon or other staff member to correctly identify a patient or to perform the correct surgical procedure should be reimbursed for these costly and sometimes lethal mistakes.
With the implementation of the STO method, there will be an additional cost in salaries, wages, and benefits for the surgical unit. The majority of these costs will be associated with the following position groups: 1) Surgeons; 2) Surgical Nurses; 3) Anesthetists; and 4) Cleaning/Housekeeping Services. The proposed STO method implementation should consider each of these positions because they play a role in the perioperative suite across different stages. These efforts will combine to accommodate the overall delivery and implementation of the STO method in the perioperative suite and will account for the additional costs associated with implementation in each unit. Fringe benefit costs will also be budgeted to accompany salary costs. In addition, the recruitment of a consultant will be included to provide the knowledge and expertise that is required to implement the system and to train employees who work in the perioperative suite on a regular basis.
The cost of supplies associated with this implementation effort are also budgeted and will enable the team to purchase any and all supplies that are necessary to accomplish the desired objectives in a timely manner. These supplies will be used to improve and maintain STO implementation once it is achieved. Supply costs are required because the full implementation of the program is based upon a series of steps, many of which require additional supplies so that the STO method is successful. Furthermore, supplies will be budgeted on an annual basis to accommodate the needs of the perioperative suite and the STO method at all times for the foreseeable future.
The implementation of a “surgical time out” process for reducing the incidence of surgical errors is a critical component of optimizing surgical environments. It is important for all surgical staff members to support this initiative because it will create new opportunities for enhanced quality of care over the long term. These principles are critical to the success of the surgical experience and for the wellbeing of all patients. It is possible that some surgeons and nursing staff members might not be in full support of this endeavor at its inception; however, it is likely that after training on the new system and method has begun, employees will recognize its value and significance in supporting the growth of the surgical enterprise and in achieving optimal quality of care for all patients. However, it is necessary for the organization to strongly consider the implementation of this practice as a means of achieving optimal patient care and treatment in the surgical setting. The proposed budgetary requirements serve as a guide in making a decision that will effectively impact the organization and its patients in a positive manner on a consistent basis. After the period of implementation has passed, the benefits of the program will outweigh the costs and will lead to successful outcomes in the form of minimizing errors and eliminating wrong patient scenarios from the surgical suite. Therefore, this effort requires a strong level of dedication and commitment from all surgical employees so that implementation is as smooth and as error-free as possible.
Agency for Healthcare Research & Quality (2012). Patient safety primers. Retrieved from http://psnet.ahrq.gov/primer.aspx?primerID=18
Altpeter, T. Luckhardt, K. Lewis, J. Harken, A., & Polk Jr, C. (2007). Expanded Surgical Time Out: A Key to Real-Time Data Collection and Quality Improvement. American College of Surgeons. Elsevier Inc.
Backster, A. Teo, A. Swift, M. Polk, C Jr., & Harken, H. (2007). Transforming the surgical “time-out” into a comprehensive “preparatory pause.” J Card Surg. 22(5):410-6.
Centers for Medicare & Medicaid Services (2009). Decision memo for surgery on the wrong patient (CAG-00403N). Retrieved from http://www.cms.gov/medicare-coverage-database/details/nca-decision-memo.aspx?NCAId=221&ver=17&NcaName=Surgery+on+the+Wrong+Patient&bc=BEAAAAAAEAAA&&fromdb=true