Metrics that Matter: Considering Clinical Complexity with Length of Stay More Accurately Indicates Efficiency

We get many questions about the benchmarks of efficiency in hospital operations and throughput. Someone posed these questions in a recent LinkedIn discussion thread:

“What is/are your suggested set of throughput metrics? What is the data expression of throughput?”

I thought the answer was worth repeating here:

The obvious starting metric is acute length of stay, which every hospital measures and can correlate to improved efficiency/capacity/cost control when they reduce it.

We encourage hospitals to use a modified measure as a baseline for efficiency: CMI-adjusted length of stay. Here is a description taken from the executive guidebook Achieving Medicare Breakeven, written by Care Logistics CFO and longtime hospital executive leader Samantha Platzke:

The CMI-Adjusted Combined LOS Ratio is a high level operational efficiency
measure. It is defined as the ratio of the number of days of hospital care that were
utilized to care for patients adjusted for the documented severity of the illnesses. This includes patients admitted for both inpatient and observation care so that the payer prescribed changes in the definition of patient status do not skew the health system’s overall length of stay.

The CMI-Adjusted Combined LOS Ratio demonstrates the overall efficiency of
the hospital’s operating system in providing predictable and reliable patientcentered care. Understanding this ratio enables a health system to begin to identify opportunities for improving patient flow, increasing capacity, improving revenue performance, and reducing case costs. A good reference CMI-Adjusted Combined LOS Ratio is 2.75 or below.

The following table demonstrates the CMI-Adjusted Combined ALOS analysis, broken down as follows for example Hospital A:

  •  Component metrics
  • Level of opportunity for improvement
  • Level of associated cost savings assuming (1) no change in CMI, (2) an
    associated 5% improvement in CMI, and (3) the combined total
    CMI-LOS Formula -2

At a more detailed level, we work with hospitals to define throughput metrics based on targets for eight specific logistical throughput milestones. The hospital measures its time-based efficiency for these milestones, then sets and measures improvements as it implements better throughput processes and technologies. Those become core measures of success in their transformation efforts, reported on scorecards and dashboards in regular leadership and team reviews.

Improving these measures requires a system-wide approach across the entire hospital. Isolated performance improvements in certain departments or services areas won’t reliably and sustainably improve performance from admissions through discharge for all patients.

One thought on “Metrics that Matter: Considering Clinical Complexity with Length of Stay More Accurately Indicates Efficiency

  1. A motivating discussion is worth comment.
    I do believe that you should publish more on this issue, it might not be a taboo matter
    but typically people don’t discuss such issues.
    To the next! Best wishes!!

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