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Rooting Out Waste in Health Care by Taking Cue From Toyota Assembly Lines

January 1, 2013 at 12:00 AM EST
When the Virginia Mason Medical Center in Seattle was losing money for the first time in its history, CEO Dr. Gary Kaplan turned to an unlikely place for help: giant automaker Toyota. Health correspondent Betty Ann Bowser reports on the hospital's success in lowering costs and improving health outcomes.
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JEFFREY BROWN: And now a question you might not have pondered before: What can a medical center learn from an auto manufacturer?

NewsHour health correspondent Betty Ann Bowser has the answer.

BETTY ANN BOWSER: Sixty-three-year-old Robert Sherrell had no idea lower back pain could hurt so much.

ROBERT SHERRELL, patient: I was like, wow, what is that? And it was tremendously weakening and just took me right down.

BETTY ANN BOWSER: Sherrell is among the 80 percent of all Americans who will have a bad back some time in their lives. And when that happens, many patients undergo an MRI, an expensive imaging test.

But nine leading doctor specialty groups recently said MRIs are often a waste of money and medically unnecessary. Doctors here at the VirginiaMasonMedicalCenter in Seattle take that to heart. They use special software at the lower back pain clinic that rejects any order for an MRI, unless a long list of criteria has been met.

DR. ROBERT MECKLENBURG, VirginiaMasonMedicalCenter: If there is no evidence-based indication, the test cannot be ordered.

BETTY ANN BOWSER: Virginia Mason’s Dr. Robert Mecklenburg says in just three years, they have eliminated unnecessary procedures and saved money.

DR. ROBERT MECKLENBURG: We have seen well over 10,000 patients in this clinic, and their return to work is twice as fast as the old style of back pain care that we delivered before. The patient satisfaction is much, much higher. The cost of delivering the care is much less.

BETTY ANN BOWSER: The software is part of the medical center’s war on waste that started more than 10 years ago. At the time, the center was losing money, and Dr. Gary Kaplan had just been named CEO.

DR. GARY KAPLAN, VirginiaMasonMedicalCenter: Waste is all of those things which add no value for the customer. It’s embarrassing, frankly, but we find, in most processes, 70 percent to 95 percent of the time that’s spent adds no value to the customer.

The waste of waiting, the waste of movement, the waste of over-processing, the waste of excessive inventory, all waste that add no value.

BETTY ANN BOWSER: Kaplan learned that lesson from studying the philosophy behind the world-famous Toyota production system.

It’s based on the idea that, if waste is rooted out along the assembly line, the result is better cars and lower costs. Some of what Toyota does may sound like common sense. But when a little of it is applied here and there, it can add up to big savings.

That can mean anything from returning patient phone calls faster to moving supplies to where the patients actually are.

The prestigious Institute of Medicine recently zeroed in on waste. It said $750 billion is wasted every year in the American health care system. It also recommended more teamwork among doctors and nurses, saying that would make care more efficient.

At the Kirkland Clinic in suburban Seattle, teamwork is a mantra. That’s why Rhonda Ciuchta goes there for health care.

RHONDA CIUCHTA, patient: I just go straight to the check-in. They give me a card. You go straight to your room, and within a couple of minutes, a care nurse comes into the room and checks your weight, checks your height, blood pressure. And she calls the doctor in, and we just update and talk about what’s going on.

BETTY ANN BOWSER: And Ciuchta doesn’t waste a lot of time waiting to see the doctor, because Kirkland doesn’t have waiting rooms.

DR. ROBERT MECKLENBURG: It’s just an embarrassing reminder of how inefficient we are in health care delivery. It’s just a shame to see waiting rooms. And we devote huge amounts of money to fancy waiting rooms.

BETTY ANN BOWSER: Virginia Mason is slowly getting rid of waiting rooms at all its facilities. It’s been able to do this by taking calls for appointments as they come in, instead of letting them back up at the end of the day.

All of this has meant the staff has had to change some very basic ways it thinks about the delivery of health care. Here at Kirkland, it’s the medical assistants, or M.A.s, who control the work flow.

DR. RICHARD FURLONG, Virginia Mason Kirkland Clinic: So, this is the flow station, and this is the place where the provider and the M.A. work together as a dyad. The M.A., we call flow manager now, and the flow manager is directing us about what we should be doing.

BETTY ANN BOWSER: Like a traffic cop?

DR. RICHARD FURLONG: Like a traffic cop.

BETTY ANN BOWSER: Dr. Richard Furlong is medical director of the Kirkland Clinic.

DR. RICHARD FURLONG: The physician takes directions from the M.A. And that’s a change for providers to accept direction from an M.A. The work is spread across the team.

And we are no longer the center of the universe. The patient is, and the team is what is delivering the care. Frankly, I think it was even hard for the M.A.s at first, but we broke that down. Now, frankly, I think if you watch them, they actually enjoy bossing us around.

BETTY ANN BOWSER: Kaplan and his staff first got the idea for doing these sorts of changes when they started visiting Toyota in Japan back in 2002. They were convinced that some of big carmaker’s philosophy would work in Seattle, but it was a hard sell to the staff of 5,000.

DR. GARY KAPLAN: I would say in the beginning we maybe had 10 percent early adopters, you know, really champions of this work. And then there were 10 percent that I — sometimes say, over my dead body, you know, I’m not going there, and then 80 percent in the middle.

BETTY ANN BOWSER: What the doctors didn’t like was something that happens all the time on the assembly line.

DR. GARY KAPLAN: It’s really fascinating. They make 1,000 cars a day in the factory. There’s 350 workers. And if the worker doesn’t have what he needs to do his job or sees something that he’s concerned about, he can pull the cord and stop the entire factory. It kind of was mind-blowing.

BETTY ANN BOWSER: Today, that is more than just an idea. At Virginia Mason, every employee is expected to report any serious concern they may have. It’s helped reduce liability costs by 60 percent since 2004. It’s also led to better patient care.

The hospital’s nursing staff has been part of the change. Charleen Tachibana is senior vice president and hospital administrator.

CHARLEEN TACHIBANA, VirginiaMasonMedicalCenter: We really started looking at where nurses were spending their time, and we found that they weren’t spending it with patients.

BETTY ANN BOWSER: In fact, they were spending too much time collecting supplies and drugs ordered for patients by the staff. So supplies were removed from a central storage room and put into hospital rooms, bedside.

CHARLEEN TACHIBANA: Through a variety of changes, we wound up taking about our nurses time from 35 percent in direct contact with patients to upwards of 90 percent of their time in contact with patients.

BETTY ANN BOWSER: But there have been bumps in the road. Some traditional health care thinkers say the medical center is practicing a one-size-fits-all form of medicine. But Kaplan and his staff remain committed.

DR. GARY KAPLAN: The case for change is compelling. The resistance to change and the anchoring in the status quo is still very strong. And so that’s our objective here. We talk at Virginia Mason about transforming health care. And some might say, well, it’s delusions of grandeur. And, really, all we really want to do is show what’s possible.

BETTY ANN BOWSER: A number of hospitals are now experimenting with Toyota production system principles. Meanwhile, Virginia Mason was recently named hospital of the decade by a respected health care rating organization.

JEFFREY BROWN: What’s to blame for rising health care costs? We break down seven factors that drive up spending. And what could we buy with the billions of dollars wasted? Our infographic offers some examples. Plus, you can see a comparison of U.S. spending on health care compared to other nations. All that is online.