Bowtie Confidential 4/7/13

Revisiting Healthcare Service Line Strategy and Development

In the past 10 years, service line development has proliferated. The topic was on the cover of the latest HealthLeaders and has been presented at several industry conferences. The heart of the issue is the need to collaborate internally and develop an integrated approach to service line development  versus a siloed approach.

The intent of service line operations is to provide better quality of care with focused resources while managing costs in an effective manner. Typically, service lines are limited to a group of well-defined sets of services and/or interventions. Examples include orthopedics, surgery, cardiovascular services, and oncology. If designed well, they provide pathways to increased operational efficiencies and financial success.

Developing and implementing a service line requires a significant amount of planning. The planning effort needs to take into account ongoing monitoring, evaluating, and modifying operations. Key components of service line development include:

• Governance and organizational structure
• Executive sponsorship – alignment with organizational goals, objectives, and mission
• Physician sponsorship
• Capital budget allocation
• Market analysis (brand management, competition, community need, pricing/cost, ROI, etc.)
• Continuum of care process: vertical vs. horizontal care delivery
• Resource analysis and requirements (clinical, financial, operational, etc.)
• Patient/community input
• Workflow and dataflow analysis
• Data analysis and requirements
• Reporting metrics
• Systems and technology analysis
• Evaluation and tracking methodologies/processes

I have experienced changes in service line modeling over the past few years  — specifically, a trend from vertical to hybrid vertical/horizontal models, which leverage a multidisciplinary approach. Models continue to focus on improving the coordination of operations and data acquisition, which allows organizations and executives to analyze the health and status of the service line(s) for greater profitability and enhanced operations. This is predominantly due to changing regulations, policies, costs, information technology, and other environmental elements.

Strategically, service line thinking needs to be re-evaluated to gain the full benefits that it can offer. Physician, patient, and community participation needs to be considered and included. Clinical service lines provide an opportunity for a comprehensive integrated care delivery model. This model can address patient and community needs throughout the delivery process by enhancing clinical quality and patient satisfaction and simultaneously improving operational efficiency and lowering the cost of care delivered.

In addition, more organizational attention needs to be placed on data governance and management. If your organization is developing a new service line, I recommend the following action steps:

• Use the key component bullets above as an evaluation checklist
• Commit to a well-structured strategic planning effort
• Develop a data governance planning and management strategy
• Build in a periodic service line assessment that provides metrics and dashboards to leadership

The importance of data cannot be minimized or overlooked. Data governance, management, and infrastructure are keys to service line success. Data provides the eyes for information on populations, best practices, overall operations, improving patient experiences, etc. Without a well-structured data governance process, the quality of data and information is suspect, potentially leading to errors in critical decisions.

The key to success in service line operations is to rethink current service line operations and data management. Review current service line strategies, operations (tactics and metrics). Seek support and involvement from the organization’s constituency – physicians, executive leadership, community, staff, and others within the sphere of influence. Look for synergy and integration between service lines and providers to obtain the best path for efficiency, effectiveness, and improvements in the continuum of care (quality). Lastly, seek external support, guidance, and direction for industry best practices and strategy development.

Rob Drewniak is vice president, strategic and advisory services, for Hayes Management Consulting.