Pulmonary Associates Dramatically Increases Efficiency with Value Stream Mapping

Albert A. Rizzo, M.D., and Heinz J. Dommert, MBA, MS

Technology, depending on how it is used, is often credited with the success or failure of aspects of managing a physician’s practice. Although there is no doubt that technology plays an important role, each process in an office operation – billing, scheduling, handling phone calls, responding to consultations, etc – must be sound.

All too often the perception is that technology and processes are mutually exclusive. In order for technology to be utilized at peak performance the underlying process must be designed to match that technology. As part of the move into the world of electronic medical records, a whole new practice management system was recently implemented at Pulmonary Associates. As a result, the billing process that had been in place for years was faced with adapting to a new practice management system. The result was a new high-tech system being utilized in the tried and true old ways of doing things.

At about the same time, the Medical Society of Delaware Insurance Service (MSDIS) sponsored a seminar – provided by Delaware Manufacturing Extension Partnership (DEMEP) – for physician practice managers on “Lean for Healthcare Organizations.” Our practice managers at Pulmonary Associates were familiar with the concept of “Lean” as it related to efficiencies put in place in the automotive industry and decided it may have some merit in our situation.

In order to streamline the long-standing billing process with the new practice management system, Pulmonary Associates took advantage of the seminar and followed up with DEMEP to put Lean practices to work in the office. Under the direction of DEMEP, we decided to proceed with a Value Stream Mapping event to kick off the Lean journey.

The Value Stream Map resulted in the following efficiencies in the billing process (Actual results):

  • 26% decrease in the number of steps in the posting and billing process
  • 62% decrease in elapsed time (total time) from initial patient contact to collection for services
  • 315% increase in first time quality of submissions
  • Dramatic reduction in rework time for the billing and posting staff

OK, so what is a Value Stream Map?

A Value Stream Map provides a detailed picture of all processes in a Value Stream. It allows an organization to develop a clear vision of what it means to be Lean. In our case, Value Stream Mapping was a three-day event with the first half of day one being classroom education on Lean concepts, helping us to understand and identify the potential wastes within a process, and how to apply Lean tools to these processes. After the training, current state and future state maps can be generated. The result of the Value Stream Mapping exercises and subsequent review then act as a road map or plan for the organization’s improvement.

Pulmonary Associates decided we would benefit most by mapping our billing process. This begins with the time an initial appointment is scheduled until the bill is resolved and closed out We gathered a team to participate in the project. The team consisted of some physicians, staff (clerical, billing, medical assistant, medical records), office management staff, and our business manager and accountant. After the initial training, the mapping work began.

For the Current State Map, the team captured all the steps that occur within the entire process. They were shocked to see that it required 42 different steps from scheduling an appointment through closing out the paper work. For each step critical data was compiled; for instance, cycle time (how long it took to perform each step), total time (before moving to next step), first time quality, etc.

Once the data was added to the Current State Map, real analysis could begin. Waste was identified at each step and countermeasures were defined to reduce or eliminate that waste. The information from the Current State Map was used to define the Future State Map, which now represented the process with the waste removed. Once the waste was identified, new methods were put in place to eliminate them. Each team member brought expertise that proved invaluable to improving the process every step of the way. Everyone seemed to enjoy finding ways to eliminate pet peeves that made the job less pleasant. An action plan was created in consultation with the physician-owners and time lines for each improvement task were put into place. The key to success is the willingness of management to implement the defined action plan to achieve the Future State Map and realize the projected benefits. As you can see from the above statistics, the results were significant.

– This article appears with the permission of the Medical Society of Delaware.