The year of ‘major health reform’

LHC welcomes the Australian Prime Minister’s statements to this effect.

Perhaps Australia does not only face a choice of;
1. Cutting pensions, health services and aged care;
2. Running massive deficits; or
3. Boosting productivity as the population aged to help lift tax revenues.

The systemic application of lean thinking to the healthcare sector offers a far less painful but incredibly effective contribution to reducing the stress on the healthcare sector, even as demand grows.

Lean thinking orients the clinical and managerial focus toward the value being delivered to the patient and opens the way to freeing existing resources for redeployment and adopting new delivery models that add to safety, quality and productivity.  “Lean tools provide an informed framework that is effective and easy to use” said Lean Healthcare Consultants’ Director Peter Boyce today (1/2/2010) “Extrapolating our team’s experience, 10-15% savings are very deliverable, more if a truly systemic approach is taken” he added.

Health spending pressures are reported to account for up to two-thirds of the total projected increase in government spending over the next 40 years. Refining the carve-up of commonwealth and state responsibilities to fund and run the nation’s public hospitals has only limited ability to change the actual cost (other than resolving administrative overlap). Many industries (automotive and aviation are two) have already been able to achieve 20-50% reductions in resource demand per unit of output and the US and UK health systems are now approaching ‘lean’ in a more systemic way.  Supporting a system wide uptake of lean principles (in the same way as the global automotive industry emulated Toyota in the late 20th century) makes sense for public and private healthcare, for health insurance, for dental and allied health.

(This article has been informed by reporting in The Australian newspaper)