Mayo radiology shows how to boost efficiency, cut costs the ‘TDABC’ way

An exemplary radiology department has demonstrated how to apply the innovative business-management technique called “time-driven activity-based costing,” or TDABC, to fix some common and costly workflow inefficiencies in radiology.

Using TDABC to address previously vexatious problems managing, in this case, their MR enterography service line, Mayo Clinic radiology staffers in Rochester, Minnesota, identified and cut unnecessary steps and costs to the tune of 13 percent while reducing staff time by 16 percent and patient process time by 17 percent.

They report their success in an article posted online Jan. 13 in the Journal of the American College of Radiology.

In introducing their material, Laura Tibor, MBA, Phillip Young, MD, and colleagues cite the work of TDABC pioneer Robert Kaplan of Harvard Business School, who explains that TDABC combines process mapping from industrial engineering with activity-based costing from accounting. In healthcare, Kaplan says, it “enables providers to measure accurately the costs of treating patients for a specific medical condition across a full longitudinal care cycle.”

Tibor and co-authors describe their TDABC project, which began in February 2015 with the charging of a multidisciplinary team to identify the personnel, equipment, space and supply costs of providing outpatient MR enterography (contrast-enhanced MR imaging of the small intestine).

The team first mapped the current state, timed procedures and calculated costs around each element of the care cycle. Members then developed “plan-do-study-act” cycles to brainstorm and test changes, and they used run charts to track their progress.

By the time the changes were fully implemented in November 2015, the main modification the team had made was reassigning the preparation and injection of glucagon, a hormone that decreases bowel motion to allow clear imaging, from nurses to technologists.

From this, the authors write, several cascading positive impacts resulted. These included a significant decrease in total process time, which fell from a median of 198 to 165 minutes (a 16 percent reduction, and in the patient in-process time, which decreased from a median of 102 to 85 minutes (a 17 percent reduction).

Meanwhile, time savings resulted for the radiologist, resident and fellow at a 22 percent reduction, the technologist at 18 percent, and the LPN at 17 percent, the authors report.

“The saved process time was used to augment existing examination time slots to more accurately accommodate the entire enterographic examination,” they write, adding that staff anecdotally expressed an improved sense of job satisfaction.

“This process provided a successful outcome to address daily workflow frustrations that could not previously be improved,” Tibor et al. write.  

The authors emphasize the essentialness of a multidisciplinary team and the use of a structured problem-solving approach.  

With these pieces in place, TDABC “can be used to identify specific time and cost values for all steps in a given health care event,” they write. “The TDABC methodology allowed radiology to develop a process to more accurately identify and reduce the cost of providing an MR enterography examination.”

The authors acknowledge three factors that keyed their success and, if absent or sufficiently dissimilar, could hinder replication of their results at other institutions: major time commitment; ready availability of skilled staff members to accurately assess current state, actualize TDABC, and implement new methodologies to support sustained change; and Mayo’s not-for-profit status.

The latter characteristic can help win buy-in from users who may not see immediate financial outcomes-related benefits, the authors note, although leaders in other not-for-profit organizations, they write, “may have less ability to dedicate significant resources to support TDABC methodology as a means to reduce healthcare costs.”

Click here for more on TDABC and here for more on TDABC as specifically applied to healthcare.