Uncovering hidden cost-efficiencies with advanced analytics
Karolinska University Hospital decided to develop a highly sophisticated analysis capability and enterprise-class planning and budgeting solution based on IBM® Cognos® TM1®.
“We had been using TM1 in a limited capacity for personnel planning and budgeting for a number of years, and our positive experience with the solution gave us the confidence that it could handle the demanding requirements of a new, integrated data model,” recalls Adrell. “After a successful proof-of-concept exercise, we were convinced that TM1 was well suited as a platform for building our own advanced capabilities for analysis and planning.”
Ruth comments: “At Karolinska University Hospital, we have continued to build on our legacy CPP platform and combine it with new, customized analytics and planning algorithms, driven by the powerful TM1 processing engine. As a result, we are now able to manage very complex and multi-dimensional analyses in near-real time. By assigning procedures to categories such as cancer, surgery or outpatient care, we can see how much each category is actually costing the hospital, and whether it would be more efficient for other providers to handle certain procedures.
“Take emergency appendectomies at our children’s hospital, for example. Using TM1, we can see how many operations we performed this year, how many we performed the previous year, and the costs, personnel and beds associated with those procedures. We can then adjust next year’s forecasted number of appendectomies up and down, and see the impact those changes have on the availability of resources for other procedures at the hospital.”
The team at Karolinska University Hospital is rapidly building a new financial, operational and personnel planning process based on the experience they have gained so far.
“For the most part, we work directly in TM1, which is connected to the data warehouse containing all our financial, personnel and operational data—although we also have the flexibility to import and export data from spreadsheets when we need to,” adds Adrell. “Now that we know the true cost of our care, we can start to build new planning processes. We are currently extending our capabilities by developing our new planning and budgeting using the same logic.”
Delivering outstanding services to a growing population
“Our resources are limited, and we need to be extremely diligent in how we plan, budget and assign our personnel,” Ruth comments. “We serve around 1.7 million patients every year, of which 60 percent come in via the ER and 70 percent will need an X-ray. Even a ten percent increase in ER admissions can have a substantial impact on the rest of the hospital.
“This type of analysis is extremely important given the demographic trends that we’re seeing across Sweden. We increasingly use our tools to analyze and simulate, and TM1 plays an essential part in those tasks.”
By identifying simple-but-costly procedures that could be delivered more effectively by local health centers, Karolinska University Hospital can specialize on its core competences and boost cost-efficiency.
“Specialization will enable us to streamline our operations, which will mean a better experience for our patients,” says Adrell. “We predict that our new way of working will help us to reduce waiting times for treatments and diagnostics, identify economies of scale, and determine the best and most cost-effective treatment options for our patients.
“One good example is new medicines for chronic conditions such as rheumatoid arthritis. Although relatively expensive compared to older classes of drugs, in many cases these new medications enable patients to defer or even avoid the need for surgery. Our TM1 model enables us to factor in the costs of treating conditions with medication versus surgery, and plan our personnel requirements accordingly.”
Ruth concludes: “Effective human resource planning is vital to ensure that we have the right skills in the right place at the right time to treat our patients, and that beds and operating rooms are available when we need them.”