Lean Healthcare

The State of Lean Healthcare: Critical Mass is Building

By Jon Miller Published on May 7th, 2005

The development of the awareness and practice of Lean in the healthcare sector has been interesting to watch over the last several years. Although a great number of people who work in healthcare are still in the “unaware” category there are increasing signs that it is developing rapidly.
The main reason why hospitals are not going Lean is still the excuse that “we are different” or that the trainers or consultants in question do not have a healthcare background. This is rapidly changing as resources become available and Lean healthcare slowly moves towards the mainstream.
Three years ago there was practically no one credible (including us) teaching Lean (Toyota Production System) and how it applied effectively to healthcare. Today there is a variety of individuals, organizations and approaches being used to successfully take waste out of healthcare.
The first group consists of Lean manufacturing consultants who have successfully crossed the chasm to teaching hospitals how to become Lean organizations. They bring a consulting background but no healthcare background.
Academic and educational organizations including LEI (Lean Enterprise Institute) and the University of Michigan are teaching courses and providing certification in Lean healthcare. More are sure to follow.
There are former nurses and doctors who have turned consultants and trainers either as a result of work experience in the automotive industry and exposure to Lean or through research in the area of TPS. This has lead to the development of some unique adaptations of TPS tools (waste, value stream maps, A3 reports, process observation) for healthcare that may be particularly suited to healthcare’s unique needs.
We have heard from hospitals on both coasts as well as in the Midwest who are using industrial engineering firms, taking their Lean approach to observing and improving processes within hospitals.
Some progressive hospitals are recruiting Lean Managers or Continuous Improvement Managers from industry, building in the capability to train staff in Lean principles, mapping the primary value streams, and holding kaizen events or other improvement initiatives in-house to drive out waste.
There are major employers, non-profit institutions, and local governments partnering with healthcare providers to improve quality, cost, and safety through not only Lean but behavioral changes on the parts of employers, employees, and healthcare providers. An example is the Puget Sound Health Partnership in King County, Washington. Another is the “Safe & Lean Hospital Project”, a partnership between IBM and the University of Pittsburgh Medical Center to enhance safety and efficiency within healthcare settings.
At the non-profit level, each of the 50 states has what are known as QIOs or Quality Improvement Organizations who are funded in part by CMMS (Center for Medicare & Medicaid Services) and are responsible for improving quality and cost of healthcare services paid for by CMMS and provided by clinics, doctors, etc. Several of these QIOs have been actively seeking out Lean tools such as Value Stream Mapping or leading kaizen activities.
Community colleges have been incorporating Lean into their programs for several years, and there are several significant initiatives, including one in Iowa, related to Lean in hospitals. The non-profit state-level manufacturing support centers (MEP) whose sometimes tenuous funding is a combination of state, federal, and self-generated are also taking a hard look at expanding their definition of “manufacturing” to include healthcare.
More power to everyone! Hospitals are unique businesses with unique challenges for the Lean practitioner. Healthcare is somewhat like death and taxes, and what happens to the cost and quality of healthcare will affect practically everyone at some point in their life.
The total cost of healthcare in 2004 was a staggering $1.7 trillion, about $5,700 per citizen of the U.S. Hospital cost about a third of this, or roughly $500 billion of the total healthcare cost in the U.S. (as of 2004). Critical mass is building, both in terms of growing costs, and the ability of the Lean community to help cut out these costs.
With less than 5,800 registered hospitals in the United States it will be interesting to see how quickly this diverse group of Lean practitioners can bring about meaningful, lasting change to healthcare.

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