How UT Health East Texas Addresses Healthcare’s Waste Problem

October 31, 2022 - The US healthcare system has a waste problem. Recent research published in JAMA confirmed that about a quarter of healthcare spending in the country can be attributed to waste, with wasteful spending totaling up to $935 billion.

Waste is an obvious issue for the US, which already spends significantly more on healthcare versus comparable countries like Germany and Canada. Meanwhile, patient outcomes tend to be worse compared to those countries despite increased spending.

Cutting waste in the healthcare system is a top priority for policymakers, but hospital executives are also taking a crack at a solution.

Hospitals and health systems have their own waste problems. Clinical waste, including failures of care delivery, failures of care coordination, and overtreatment, accounts for almost 16 percent of all US healthcare spending, researchers recently reported in Health Affairs. What’s more, there is widespread variation in the prevalence of clinical waste even within a hospital system itself.

“All hospital administrators know inherently that there is a fair amount of waste in the hospital and in healthcare,” says Tom Cummins, MD, chief medical officer at UT Health East Texas, a 10-hospital system with more than 50 clinics across the state of Texas. “There is an opportunity to trim some unnecessary costs to allow systems to stand on better financial footing.”

While the US healthcare system is straining from all its spending, so are hospitals and health systems. Hospitals are facing one of the worst financial years in recent history as supply chain disruptions, labor shortages, and the ongoing COVID-19 pandemic drastically increase the cost of delivering care. Financial recovery is also barely on the horizon right now, according to health economists.

Hospitals will need to enact cost-cutting measures to stabilize balance sheets, healthcare industry experts agree.

Fortunately, some hospitals and health systems like UT Health East Texas already have some tools in place to cut down on unnecessary costs while still ensuring high-quality care for its patients.

Technology reduces waste, unnecessary costs for all

UT Health East Texas utilizes technology from IllumiCare to alert clinicians at the point of care when a lower-cost option is available or if a treatment may not be necessary.

“The tool sits over the hospital's electronic health record and it nudges providers on opportunities where they could choose between two equally efficacious options for say medications,” Cummins explains. “It shows price comparisons for the two, allowing the doctor to have the opportunity to check or use a lower-priced medication.”

The tool is also a key weapon in the fight against waste in healthcare.

“It also helps identify opportunities to avoid some waste in the hospital by alerting doctors ordering labs, for example,” Cummins says. “They may be ordering them more frequently than are really needed, so the tool helps them understand that they may not need to check that lab every day. It could be checked once a week, every six months, or whatever it might be based on clinical evidence. It then links the clinical evidence for the physician in case he’s not sure he believes what the technology is saying.”

Hospital administrators are not looking to dictate how clinicians provide care, rather they want to give clinicians the opportunity to not only support hospital operations by reducing unnecessary spending but also provide them with the information they need to streamline high-quality care.

Technology allows UT Health East Texas to achieve both of those goals through the tool’s ribbon feature. The ribbon appears within the EHR at the point of service to nudge clinicians, as Cummins points out. Clinicians can accept the nudge and learn more or ignore the ribbon if it is not relevant at that moment and it goes away.

“It’s not particularly onerous or burdensome for the physician to use, but it is an opportunity,” Cummins states. “So from a clinical standpoint, it is a great tool. It can really help point you in the right direction to make some better decisions in real-time.”

The ribbon can, for example, nudge clinicians when patients are nearing the expected length of stay if they have been admitted to the hospital. The nudge can set into motion a care team to prepare patients for their healthcare journey outside of the hospital.

“The provider knows that we should be approaching time for discharge so we can get people out of the hospital setting in a timely fashion,” Cummins says.

The savings on a per-admission or per-case basis may not seem like that much. However, Cummins stresses that even savings of $40 per case can add up to something big when the hospital has 10,000 similar admissions. The clinical and financial benefits can then funnel to the patient.

“People with high-deductible insurance plans, where so much more of it is coming out of their pockets, it will help patients save at that level,” Cummins states.

Lessons learned

Technology is an important resource for hospital administrators, clinicians, and patients. In the case of UT Health East Texas, a technology solution streamlines the process of pulling data from the system’s pharmacy, laboratories, and other areas to consolidate it and deliver it in a way that is useful for clinicians and beneficial for hospital administrators looking to reduce waste and unnecessary costs.

“We’re always looking for automated tools that can help improve efficiency in patient care, supply chain, and other areas,” Cummins says. “All healthcare organizations are looking for anything automated that can help them streamline their operations.”

However, technology is only as good as the data it pulls from and its ability to draw the right user’s eye to it, Cummins adds.

“The electronic health record does—assuming it has good data on cost—have a lot of information about cost per case, cost per admission, even cost by provider,” Cummins explains. “You can see which doctors tend to be more expensive than others, are using more expensive equipment, and prescribe more expensive medications.”

UT Health East Texas is using its cost data to understand if patient care is better or just more expensive because, after all, higher costs do not equate to better outcomes.

“We’re starting to look at whether the costs line up with the outcomes,” Cummins says. “If we’re spending more on certain devices or pieces of equipment, are we getting better patient outcomes from that? We are also starting to question our providers. Why are they making these choices when it may be more efficacious and half the cost to use something else?”

Technology may be delivering meaningful insights to hospital administrators, but it also has to be impactful, Cummins indicates. UT Health East Texas is arming its clinicians with cost and quality insights at the point of care, but those insights must be presented in a way that doesn’t disrupt the flow of patient care.

“If you tell us too often that something needs our attention, then eventually, we start to ignore all of it,” Cummins states.

Technology must be meaningful and impactful to address the healthcare system’s waste problem, especially at the hospital level. After all, policymakers and hospital administrators are not the only ones who want to make patient care better at a more affordable price.

“Most physicians want to do the right thing and help hospitals do well, but they can only do it if they know,” Cummins explains. “Technology solutions can help a physician understand the costs of what they’re choosing to use.”