Complex adaptive strategy to produce capacity-driven financial improvement.

Area of Science:

• Healthcare Management
• Operations Research
• Systems Science

Background:

• Hospitals globally face capacity management challenges, impacting admissions and increasing emergency department (ED) diversions.
• A specific acute care hospital experienced budget shortfalls due to capacity constraints, negatively affecting patient flow and financial performance.

Purpose of the Study:

• To demonstrate an efficiency model for managing hospital capacity and addressing financial underperformance.
• To test the hypothesis that reducing inpatient length of stay would improve patient access and financial outcomes.

Main Methods:

• Implemented a turnaround strategy focused on reducing inpatient length of stay within a 60-day timeframe.
• Utilized an efficiency model based on the complex adaptive systems approach of "swarmware".

Main Results:

• Achieved a decrease in length of stay by 0.1 days below budget within 60 days.
• Reduced emergency department diversions from 110 hours to 20 hours monthly within 60 days.
• Eliminated Transfer Center denials within 19 days, increasing patient acceptance.

Conclusions:

• The swarmware approach successfully created additional bed capacity, accommodating community demand and stabilizing market share.
• The efficiency model is generalizable to healthcare organizations of all sizes facing capacity issues.
• Lessons learned can assist healthcare leaders in optimizing hospital operations and patient flow.