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Keywords

financial performance, hospital performance improvement, Lean management, patient satisfaction, performance assessment, quality of care

 

Authors

  1. Rundall, Thomas G.
  2. Shortell, Stephen M.
  3. Blodgett, Janet C.
  4. Henke, Rachel Mosher
  5. Foster, David

Abstract

Background: Despite being adopted by a large number of hospitals, the relationship between Lean management and hospital performance is mixed and not well understood.

 

Purpose: We examined the relationships between Lean and hospital financial performance, patient outcomes, and patient satisfaction in a large national sample of hospitals, controlling for relevant organizational and market factors.

 

Methodology/Approach: A mixed effects linear regression analysis was performed to assess the relationships between adoption of Lean and 10 measures of hospital performance using data from 1,152 hospitals that responded to the 2017 National Survey of Lean/Transformational Performance Improvement in Hospitals. Hospital performance, organizational, and market data over the period 2011-2015 come from the 2015 American Hospital Association Annual Hospital Survey and the respective annual Centers for Medicare & Medicaid Services (CMS) Medicare Cost Report, CMS Hospital Compare, CMS MEDPAR, and the CMS Hospital Service Area File.

 

Results: Lean adoption was significantly associated at alpha < .05, with lower Medicare spending per beneficiary (b = -.005, p = .027). None of the other nine associations were statistically significant, although eight of them were in the predicted direction.

 

Conclusion: Lean adoption is not associated with most measures of hospital performance. It is likely Lean implementation varies greatly across hospitals. Future research should examine the relationships among the various dimensions of Lean implementation and performance.

 

Practice Implications: If Lean management is to contribute to hospital performance improvement, leaders must be highly cognizant of what "adoption of Lean" actually means in their hospital. Although limited, single-unit Lean initiatives in an emergency room or other patient care unit may improve performance on some unit-specific measures, improvement on hospital-wide measures of performance requires a broad, sustained commitment to the implementation of Lean practices and tools.