Four questions to ask about healthcare benchmarking

July 28, 2017

Here’s how successful strategy leaders look to industry benchmark data to map out where they want to take their service line, practice or institution.

Benchmarking is necessary in every industry, especially when it comes to strategy and planning. In healthcare, the comparison of a practice’s performance with an external standard is a tool facilitators use to motivate team members to engage in improvement work. It’s important for a group to understand where their performance falls in comparison to others while stimulating healthy competition that helps members of a practice reflect more effectively on their own performance.

When you’re doing a great job executing and driving better outcomes, your scores become a badge of honor for your institution. You can post them for the world to see. Not just that, but let’s remember that benchmarking can affect funding and directly impact your bottom line. Hospitals close if they’re not meeting minimum benchmarks, especially for critical metrics like readmission rates.

Successful strategy leaders look to industry benchmark data to map out where they want to take their service line, practice or institution in the months and years to come. By applying the multitude of data to your strategic plan for success, members of your organization will be more willing to commit to execution and you’ll be able to track your results.

From my work with healthcare strategy leaders on plan execution, I’ve seen thousands of plans and compiled some best practices to aid a healthcare organization in creating a plan using benchmarking data to move measurements in the right direction.

Why is benchmarking important?

We sit in the realm of uncertainty today when it comes to Affordable Care Act (ACA) reform and value-based care, benchmarking is going to become especially imperative for planning. Accountable care organizations (ACOs) that meet quality benchmarks and keep spending for their attributed patients below budget receive half the savings that result, and the rest goes to CMS, which administers the program.

Beginning in 2012, the ACA established the Medicare Shared Savings Program to encourage the development of ACOs, made up of healthcare providers-from primary care physicians and specialists to hospitals and post-acute care facilities. As of 2015, there are more than 400 Shared Savings ACOs serving nearly 7.2 million beneficiaries, or 14% of the Medicare population. In 2013, just 52 of the 220 Shared Savings ACOs met quality-of-care benchmarks and kept spending below budget targets, but that alone generated $700 million in total savings and about $315 million in Shared Savings bonuses.

As more major healthcare legislation works its way through the branches, benchmarking will provide some solid footing and direction for future growth.

Which measures should you focus on?

Every practice is different, but there are some common threads in the way you’ll need to go about choosing the most important measures for your group. To identify the areas of clinical performance you want to assess, ask your team. Involving front-line employees as well as leadership-level employees will help establish a broader picture of success indicators as you compile input.

The areas of clinical performance chosen should then connect to the improvement goals the quality improvement (QI) team has set. Aligning daily tasks with overarching initiatives will induce a stronger feeling of teamwork and motivation to execute.

Lastly, you need to ensure the measurements you choose also sync up with any mandates from the funder. Once all of your measurements are picked with these stakeholders in mind, you can expect a greater level of execution and commitment to your strategic plan.

Common sources for performance measures are the Healthcare Effectiveness Data and Information Set (HEDIS), quality indicators developed by the National Committee for Quality Assurance and criteria selected by health plans.

Where can I find benchmarking data?

There are lots of sources for healthcare industry benchmark data, but one of the first places to check are local quality collaboratives. Community clinic associations are known to host these local efforts, allowing different practices to collect performance data and compare it against each other. Multi-organization QI projects are often tied to community clinic associations where data is gathered about a particular condition, and then the data is similar enough to benchmark across the participating practices.

Other sources to consider include required data reports to Federal agencies and funders, like the Health Resources and Services Administration’s Uniform Data System reports. Those, for instance, are required from all Federally Qualified Health Centers. State and local health and public health agencies are also potential resources for comparison data, as well as the National Committee on Quality Assurance and other national associations.

Becker’s Hospital Review is also a great resource to find up-to-date benchmarking. They include system-level and service-line level data, so you can drill down to see what’s most important to you. Check out their 2017 Benchmarking Report to get started.

Next: What comes after benchmarking research?

 

 

What comes after benchmarking research?

There are four key questions strategy execution leaders ask themselves when going from planning to execution:

  • How are we performing? First, you have to be able to describe what’s happening with your data. In looking at past performance, what is the story the numbers tell? What’s increased and what’s dropped off? How does your current state compare to how you’ve performed before? These questions will help you figure out which measurements to focus on for your next strategic plan.

  • Where can we make the biggest impact? Find where you can get the biggest wins. Once you’ve identified what’s been happening, where are your opportunities for greatest improvement? As your team adapts and grows, which objectives can you approach with more focused energy? Answering these questions will help you prioritize your actions and set your cadence for regular progress check-ins.

  • How do we improve? Set your specific plan of attack. How you can have the most success with your initiatives? Based on past performance effectiveness, what should you do differently to execute with greater success? Beyond the actual actions, be sure to determine who will take the lead on each tactic, and how they will provide regular updates for a big picture of success.

  • How are we doing? Keep monitoring your successes and know what’s at risk. Once your plan is in motion, are you able to get the updates you need when you need them? Can you see KPIs with live data and judge how you’re progressing at any given point? This is the most important part; what good is a plan if you don’t know how you’re executing it?

Benchmarking is not only necessary to successfully create your strategic plan-it sets you up for successful execution. Using benchmarking data helps make your goals more informed, attainable and competitive and when you take the precautions in building your plan to make sure each initiative is aligned to overall objectives, assigned to a single accountable person, visible to all stakeholders, collaborative, interactive and agile, the motivation to execute will follow.

 

 

Joseph Krause, is director of professional services & senior strategy consultant at AchieveIt