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Laverne General Hospital: Process Improvement in the Operating Room
Heineke, Janelle
Functional Area(s):
   Operations Management
   Healthcare Management
Difficulty Level: Intermediate
Pages: 24
Teaching Note: Not Available. 
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First Page and the Assignment Questions:
Matthew Yonson, CEO of Laverne General Hospital (LGH), had finished up the last of his fiscal year-end management evaluations, along with his recommendations to the Board for merit increases and bonuses.  He had a strong team in place and was more than pleased with this year’s performance, particularly in the operating room.  The processes and profitability of the OR had improved dramatically since Sheila Yardley   had taken over as OR manager in the fall of 2000: from 55% OR capacity utilization and no contribution to 85% and $15 million in 2002-2003.  The new OR management system, PeriOptimum, provided the data Ms. Yardley   needed to manage flows and physicians and Mr. Yonson could see the difference in his own office:  it had been fully three years since he’d gotten an irate call from a surgeon complaining about OR problems, a big change from the several calls a week he used to receive.  

    The OR had certainly benefited from the information provided by PeriOptimum. Mr. Yonson wondered whether it made sense to implement their system in the cardiac cath lab and the Emergency Room as well.  In the near future, at least, he didn’t see much value from PeriOptimum on the medical services: there were too many outside factors that affected patient flows on the medical units and there wasn’t likely to be as much bang for the buck.

    Mr. Yonson also wondered about next steps in the OR.  Improved performance had brought more surgical business.  The surgeons liked operating in an efficient environment because it made them more efficient – they could either do more cases in a day or they could get back to their offices more quickly to see patients. But with unused OR capacity in other Laverne   Hospitals, LGH couldn’t take surgical business for granted.  Despite the dramatic improvement, Mr. Yonson knew there was more to be done and looked forward to hearing from Ms. Yardley about her plans for the next fiscal year.