At all levels of a hospital or health system, from the board of directors to the nursing units and support departments, good scorecards should be "balanced," meaning that they should include objectives that represent all of the hospital's key stakeholders (e.g., patients, physicians, employees, community, financial stewardship, etc., depending on the particular hospital's situation).
But there are different reasons for that balance.
First, let me say that there will be meetings where parts and pieces of Balanced Scorecards will be reviewed, such as budget reviews, event reviews, and quality governance meetings, but these meetings are not intended to be conversations about the holistic strategy, so these won't necessarily cover the full scope of a truly "balanced" scorecard framework, which is just fine.
Now let me examine the different reasons for balance in scorecards at all levels of the hospital.
The Board Level and CEO Scorecard – All perspectives (i.e. strategic groupings) will be present and the holistic strategy will be represented. This audience views the strategy as it cuts across all the silos of the organization. This scorecard shows how success in objectives for the workforce, internal processes, and external partnerships will translate into better patient experiences and improved quality of care, as well as improved financial performance.
Specialized Businesses – These entities inherit selected objectives from the board-level scorecard, but they are also stand-alone business units and therefore probably have their own holistic strategies. Examples are cardiovascular care centers or cancer care centers. The strategic components cascaded from above might be objectives around strategic growth or patient satisfaction. In addition, they will have a more holistic, balanced strategy represented to accomplish their specific goals.
Core Department Scorecards - They will have objectives in all perspectives, but not for the sake of their own department’s holistic strategy; they exist to support the organization (and its strategy) as a whole. An example might be the Emergency Department or MedSurg. They inherit objectives from the scorecards above them to which they align, and they also inherit objectives from two other sources. One source will be other departments requesting that an objective be placed on the scorecard because it has a cause-and-effect relationship with their ability to perform. Another source will be objectives from within the department that are truly owned, functionally, by them. Put altogether, all the balanced perspectives on the department scorecard are populated with content, but for an entirely different reason than the board-level scorecard (not to review strategy, but to execute it).
Support Department Scorecards – Again, these represent silos within the organization. Examples are Transport, Lab, Finance, and IT. These scorecards will have objectives in all perspectives, but for the same reasons as the core department scorecards, they will not be balanced for the sake of their own holistic strategy, but rather to support the complete corporate or organizational strategy.
As an organization is developing scorecards, getting this sort of broad balance won't happen right away. It will happen through the course of ongoing scorecard business reviews, increased maturity of the framework and the organization's understanding of it, and an ever-widening scorecard deployment.
My Firm's point of view is that to truly "move the needle" on cost and quality, an organization must begin by clearly defining and it. While there is no standard healthcare industry definition of what constitutes "quality," we have found that top healthcare performers adopt a composite of measures that consider:
Clinical Outcomes: Ultimately it is the outcome that matters most. Risk adjusted healthcare quality measures such as inpatient mortality rate, readmission rate, complication rate are commonly accepted indicators of quality outcome success.
Clinical Process: Effective clinical processes are essential to achieving superior healthcare quality outcomes. At a minimum, current publicly reported "core measures" should be considered. Evidence based physician order sets and clinical care plans provide a rich assortment of additional quality process measures.
Patient Experience: Effective communication with caregivers, environment, and customer service are an important part of an effective treatment program. The medicare Hospital Consumer Assessment of Healthcare Providers and Systems is one good source of useful performance data.
Resource Utilization: "Too little" or "too much" care can adversely affect outcomes. Measures such as risk adjusted average length of stay, ICU ALOS, and cost per case are examples of effective resource utilization indicators.
Top performing organizations not only define and measure healthcare quality, they ask the question: "How are we doing? We believe that the best way to answer that question is to compare your results to those of "Top Performers." There are a number of organizations that provide excellent health care industry clinical quality and financial benchmark information. Through benchmarking, organizations are able to identify their strengths and weaknesses, and develop strategies to address and overcome healthcare quality gaps.
Benchmarked performance ratings on individual measures can then be weighted and rolled up to measure overall quality performance for individual conditions (e.g. pneumonia vs. AMI, individual hospitals within a health delivery system, or a system - wide composite score.
Finally, true improvement occurs when "stretch" goals are established by Board of Directors, and hospital management incentives are tuned to the achievement of those goals.
Posted by: Scott Hodson | July 30, 2008 at 11:58 AM