Does your small business' health need a reform?
"Our current healthcare system does not provide an incentive to keep patients healthy. We need to change the financial incentives so that providers are rewarded for quality and keeping their patients healthy" Kaiser Permanente. There are behind-the-scenes aspects of the President's healthcare reform that are reshaping the healthcare industry and have nothing to do with taxes. Having spent many years in this segment, I have seen the tsunami of changes and every small business owner can learn from them. One crucial aspect of the ACA (Affordable Care Act) is that hospitals will be rewarded and penalized based on quality of care or "patient outcomes". Healthcare professionals who want to stay in business must adopt new practices that have meaningful results; high quality of care along with shorter hospital stays, minimal infections or re-admissions among others.
What hospitals have learned, way before ACA, is that they can no longer continue to operate with inefficiencies, waste and no regard to outcomes. They were driving themselves out of business.
Interestingly, what the healthcare industry has finally decided to adopt, has been practiced by successful small businesses for many years: Here are the main points and how they correlate to business:
- PATIENT-OUTCOME = Measurable results i.e. the reason why we're in the hospital must result in a positive outcome. Bear in mind that there has to be a clear definition of what "outcome" means in each case, and objective evidence to support a claim that it has been accomplished. Let's not forget the level of customer satisfaction, improved level of service and customer-experience that influence outcomes as well.
- EDUCATION & TRAINING = Educating patients on disease prevention and better personal health. Training of hospital staff to ensure consistency and quality to minimize errors and waste. Education and training of staff is essential in the business world which ensures consistency of service as well as differentiation.
- PRODUCTIVITY = Operating at maximum efficiency while minimizing waste and increasing profitability. Businesses who are adopt at doing more with less are also highly profitable.
- SMART PURCHASING = Reduce your accounts payable by consolidating and demanding discounts. Use the freed up cash-flow to re-invest in #1, #2 and #3 above. Before you slash your marketing budget, check and audit your purchasing.
- ACCOUNTABILITY = Doctors, nurses and many other healthcare practitioners do not communicate with each other which has been the underlying obstacle to any meaningful change. Holding everyone accountable throughout the medical continuum (everyone who "touches" the patient from her first visit to an internist to total recovery) and paying them accordingly is creating dramatic progress. This is identical in a business environment. Every department in the company plays a role in satisfying customers and ensuring profitability. Strive for accountability and exercise zero-tolerance for finger-pointing.
- PERFORMANCE METRICS = The only way to ensure continuous improvement is to "measure". In hospitals and businesses "how are we doing?" is essential to making corrections when you stray off your goals and for staying ahead. Performance metrics tie into accountability and provide "objective evidence" to that effect. Numbers don't lie.