While reimbursement in the DME industry has been hit pretty hard in the last few years, business in general over the entire world is being forced into analyzing their processes to ensure that they are operating at optimal efficiencies to deal with the loss of revenue.
For most businesses the single largest expense is personnel. It is also one of the first places businesses will look to cut costs when revenue is reduced. For DME, layoffs can be disastrous. Lack of appropriate personnel can impact the quality of the customer service and billing. Any negative impact to the quality or quantity of work being done in the billing department will translate to higher DSO.
Lean processing does not necessarily translate to less employees. It does translate to more efficient employees and will enable businesses to weed out the weaker employees who are a drain on profitability.
Most business processes are not Lean. About 20 percent of the activities contribute 80 percent of the waste in the process, according to Michael L. George, author of the book Lean Six Sigma. Implementing lean processing will also eliminate non-value-added activities from the process.
“Lean” refers to the ability to do more work with fewer resources. “Workflow” refers to the way in which work (tasks and documents) flow through an organization from one person to the next. In an assembly line or factory environment, workflow is tightly controlled as part of the manufacturing process. Work arrives in well-defined units and is passed from one individual to the next in a very predictable manner.
This is not the case in the DME world.
A new order can come in via a walk in, phone call from a referral source, fax or other methods. Once the order is in, the flow of work and processes needed to complete an order will differ based on the product and the payor. The requirements are different for a Medicare Oxygen order vs. a Medicaid wheelchair. The ability to be lean is directly related to creating efficient workflow processes and controlling those processes.
The steps to create a lean workflow process are:
1. Define the processes in your organization. An example of a “process” is an order. The process begins when the order is received and ends when the item has been received by the customer and billing commences. The billing process then begins and ends when all payments are received.
2. Select one or more processes to be evaluated.
3. Document the process flow. This can be done in flowchart format or a simple step by step document of all the actions needed to complete the process. You may need to start with what's in people's heads and piled on their desks, and overflowing from their in-boxes.
4. Define departments or people responsible for the process.
5. Define quantifiable performance metrics – i.e. length of time allotted to a process.
In many organizations steps were added to a process due to a necessity at the time. For example: Spread sheets may have been created to track information that is now a byproduct of the billing software. Documents may have been created in duplicate form and filed, a process that is no longer necessary due to the ease of reprinting documents as needed. In many cases these steps remain part of the process simply because “this is the way we have always done it”. The above steps of defining the workflow will be the equivalent of auditing the process. While evaluating the process take the time to eliminate non-value-added and non-essential steps in the process. Track the paper throughout the process and determine how many times a document is handled and by how many people. Statistics show that managing the processes can speed up the steps to complete a task by 10 to 20% allowing for more work to be done by the same staff members.
In order to gain maximum efficiencies from your lean workflow processes, you will need tools to track and monitor each step of every process. Automated workflow software is a tool that enables management to manage all tasks within the organization, ensure that no tasks slip through the cracks and provide tools to control costs of processes necessary to run the business. Automated workflow software also provides the tools for both users and management to be able to see at a glance the status of each task and eliminates the possibility of bottlenecks that cost businesses efficiency at best and customers and referrals at worst.
The breathing room provided to us by the delay in competitive bidding is the perfect time to take a step back and analyze and create efficient organizations that can sustain the difficult times ahead. §