Despite the fact that the input, throughput, and output of healthcare processes is people, not machinery, re-engineering efforts can be successful in healthcare. The functional areas most amenable to BPR are the non-clinical areas, such as Billing, Supply Management, etc. The functions associated with these areas are similar across other industries, and reference models from other industries are often valuable. In clinical areas, some procedures or practices may take longer to evaluate, and there may be much more resistance to change. Reference models—and the analysis tools that support them—enable creative solutions to be tested and validated prior to implementation.

In the US, the Department of Defense (DoD) has taken the lead in applying BPR principles to multiple process improvement projects in healthcare. A vast support network exists within the DoD to drive BPR initiatives as a way of meeting the challenges of managed care, base closings and downsizing. Private sector healthcare entities face similar pressures, but do not have the advantage of a network of providers acting in concert. Effective reengineering in private sector healthcare is possible, and desirable, if a systematic and standardized (across departments) approach is used.

Recognizing the need for a universal starting point for process improvements, Wizdom Systems, Inc. developed the Healthcare Enterprise Reference Model. The Healthcare Enterprise Reference Model was developed over five years through numerous healthcare consulting and process reengineering projects. It is the synthesis of many smaller models detailing specific pieces, or groups, of healthcare functions. The Healthcare Enterprise Reference Model has been validated by various healthcare practitioners and academicians.

Wizdom Systems, Inc. uses a systematic approach to information gathering called Minerva^TM. Minerva is a four-pronged approach to BPR project management that encompasses strategic assessment, analysis of the "AS-IS", creation and analysis of the "TO-BE", and implementation of process improvements. Minerva ensures that all critical information is obtained and prioritized; and that all ensuing models have internal reliability.

The Healthcare Enterprise Reference Model is considered a starting point for documenting an existing healthcare enterprise in an "AS-IS" model and can be used to design the organization to meet its needs. The model provides the foundation to rationalize continuously in the true sense of the word and encourages new ways of thinking about healthcare delivery. It will act as a starting point for benchmarking activities and provide a template for process improvements. The model will help companies emphasize opportunities not problems, and it provides a proven template that can be used by companies who wish to plan business process optimization to meet the healthcare challenges of the future.

Sustained viability requires an assessment, analysis, diagnosis, and treatment of activities and functions that support the delivery of patient care. Once current processes are understood and have been redesigned to eliminate redundancies and non-value-added activities, areas for long-term process improvement become apparent. In addition, the activities, resources, and essential capabilities of the organization will be defined and improved.

It is the task of the healthcare manager to ensure that the firm achieves and maintains a position on the frontier of best practices and to push the frontier by continuous business process improvement.

Improving operational effectiveness may take many forms:

The goal of process improvement in healthcare is to maintain quality while reducing costs and improving access. The degree to which a healthcare organization is meeting this goal has traditionally been measured as follows:

Timeliness of services. What are the wait times for internal and external customers? For instance, does a patient have to wait longer than normal for a non-urgent appointment with a provider? Does the provider have to wait longer than normal for a test result? Is the hospital waiting longer than normal for third-party reimbursement? When measuring timeliness, 'normal' may be defined as times set by internal and external regulations, i.e., hospital policies that limit wait times for certain procedures such as those designated STAT or ASAP. Average and desirable times may be defined during benchmarking activities, or by customer perception.

Quality –The ultimate goal of healthcare processes is to maintain or improve the health of patients or populations. Quality care has been defined and regulated externally by such entities as the Joint Commission on Accreditation of Healthcare Organizations (JCAHO), and the National Committee for Quality Assurance (NCQA). Healthcare enterprises have used internal quality monitoring, such as CQI and TQM, to meet their self-imposed quality guidelines.

Capacity (Access) - is the maximum amount of output generated by a process. It affects the revenue side of long-term profitability by determining how many customers can be served.

Flexibility – a flexible process has a relatively low cost for changing resources used or outputs produced. On the revenue side, the ability to adjust output cheaply or quickly may enable a firm to increase customer satisfaction or to serve additional customers.

Each attribute has quantifiable values or properties.

Activity-based costing (ABC) links tasks to actual resource costs. ABC identifies value-added and non-value-added activities and encourages decision making about consolidation or elimination of activities. A non-value-added activity is one that uses resources but adds nothing to the end product (health care) from the perspective of the client. ABC identifies the most costly processes, which may or may not confirm existing opinions. Value judgements will be made on the cost-benefit ratio of each activity, and predictions can be made. The reader will note that ABC looks only at costs, not at reimbursements, but comparisons are easily made, and change decisions are factually supported.

 Timeline analysis: Time-line analysis should be a part of every BPR project. It is a precursor to process flow models and yields valuable information about the often hidden costs (time equals money) associated with delivering healthcare. The time is takes to perform an activity (the run time), such as 'Process Referral,' is only the tip of the iceberg. Adding the time it takes to do such things as wait for authorization, clarify an incomplete referral, or reenter data (cycle time) may significantly increase the cost of a seemingly straightforward activity.

Time-line analysis allows for comparisons between expected or optimal duration with actual duration. It is usually the case that eliminating down time or wait time will significantly reduce the amount of time, and thus the amount of money, it takes to perform an activity. Intangible but very important improvements in patient satisfaction are another benefit to time-line analysis and improvement. Why is time-line analysis so important? Linking time to activities identifies problem areas such as long cycle times or inappropriate task sequencing.

Process Flow Charting: Analyzing workflow allows managers to define exact points in the process at which bottlenecks occur. Defining decision points and identifying looping and redundant processes yields an extra dimension to process understanding.