To do our work, we have created a very sophisticated tool which we call the MAGNA/M4 system, the name that you see in our logo. MAGNA was our original system, one that in the 90s was used to provide Decision Support Services to Integrated Delivery Systems (Hospital + Medical Groups). As the healthcare market changes in the early 2000, and the large national Provider Practice Management Organizations became a thing of the past, IMOS decided to re-focus back to its roots, that of providing services to Hospitals. Hence MAGNA/M4 was born…

The right tool for the job

The original MAGNA system, while extraordinarily comprehensive in its capabilities (because it was built to  accommodate Medical Groups as well as hospitals) made the maintenance of its structures somewhat time consuming to operate. In order for IMOS to be able to deliver the compelling value called for by our new business model, we needed a tool customized to help us speed up the implementation and maintenance tasks, all the while maintaining the power and flexibility of the old MAGNA Solution. Technology came to our rescue with new tools and better hardware to allow us to create a much more compact, versatile and flexible product. Based on an SQL compliant platform, retaining the wisdom, power and experience derived from MAGNA, and adding new features to reflect the evolution of healthcare management needs, this new product is designed with two focuses: 1) Hospital operations 2) Flexibility to address hospital business questions MAGNA/M4 has the following modules:

• Cost Accounting
• Staff Productivity Management
• Business Line Management
• Business Views Production

Cost Accounting

Staff Productivity Management

As a traditional service business, the productive use of your available labor is the key to a healthy bottom line. Labor in most hospitals accounts for approximately 50% of all the organization’s expenses and the productive control of this resource will make a drastic impact in the organization’s bottom line. 

This expense is clearly highly susceptible to patient volume activity and its mix. The organization’s ability to react to this blend is key to the effective and efficient use of labor. Labor management and careful control presents an opportunity for significant profitability performance improvements within a framework of good quality of patient care and service delivery. 

Our experience has demonstrated that savings to be achieved from implementing a performance-based staffing process, together with adequate monitoring tools, range between 7% and 15% of TOTAL labor dollars (and the larger the organization, the bigger the percentage savings potential because there is more opportunity for cross-training and flexing). This can be achieved quickly (within less than a year) and with an additional positive impact in terms of quality and customer service. Most importantly, savings to be achieved through the implementation of this process and system become annuities. As time goes by the savings continue to be accrued year after year, the present value of which will yield enormous returns on investment for the effort. 

The Challenge

Good management of healthcare delivery services is based on a good understanding of the business coupled with the availability of appropriate information to validate the adequacy of actions. There are a number of variables that are being processed in the department manager’s mind in order to create the desired outcome of quality and cost effective service. Some of these variables are: volume and type of work, number of FTEs and the skill mix required to service this work, cost of the various employees, productivity of the employees, etc. No computer system can or will ever replace the human factor involved in this management task. However, the appropriate use and management of these variables is quantifiable and its reporting provides a significant measure of individual departmental productivity, cost and service performance. 

Traditionally the management of these variables has been handled in the manager’s head with little or no systems support. This is mostly due to the inadequacy of traditional transaction systems to provide the information needed to manage (e.g., employees are not reported in the right department, hours are not booked to the right department, a new department is needed, two departments share staff, etc.) Most importantly, in traditional transaction systems like Payroll and G/L, the dollars or hours do not flex with volume or even if they do (like in some flexed budgeting systems), they say nothing about whether the volume was handled productively or not. 

The challenge to meet is to empower line management by providing it the information to manage better. This information should indicate to department managers whether they are working productively or not in relation to the volume they are being asked to process. At the same time, this information should tell senior management if the organization as a whole, and each department individually, are meeting their productivity goals and what is the impact of not doing so. Further, it should tell us why we are not meeting our goals and what can be done to correct the situation. For this, a new process and the system to support it are required. 

IMOS’s Productivity Management Process and System 

IMOS’ s Productivity is a process that empowers departmental management and the chain of command at all levels by providing the information to productively manage labor resources. It does so by recognizing two important considerations: 
• Labor does fluctuate not just with volume but with the kind volume handled 
• These fluctuations are idiosyncratic, meaning industry standards may not apply to you. 

The concept is simple: Through a process that understands that quality should be maintained, this new system and its process provide “Performance Reporting” based on volume fluctuations from your OWN historically demonstrated best practices. In other words, there is not need to fight over “industry standards”. Your average performance will help deliver ideal results from the start already without involving unappealing arguments over the adequacy of external standards (even assuming those external standards can be properly identified or even found) to your operation. 

The key is that both, the process and the system have been designed with the specific goal of idiosyncratically managing labor productivity. Also, unlike other systems such as G/L, Billing, Claims Management or Payroll that have a specific purpose other than managing productivity, this new system merges the data from these other systems to provide “Labor Productivity Management” information. 

Features

• Based on your hospital’s own experience. No need to use outside standards.
• Bi-Weekly, no accruals, in synch with the payroll system.
• Allows the use of manual statistics
• Allows the creation of “derived” statistics, that is, statistics that are derived from other statistics or data on the system.
• Simple and easy to understand

Benefits

• Minimal, if any, learning curve.
• Intuitive reports designed for simplicity and completeness.
• Focus is NOT on managing by the reports but in providing the managers the information for them to manage.

A few reports convey all of the relevant information required to manage Labor Productivity.

Business Line Management

Features

• Activity Database
  The heart of the Business Line Management system is the detailed activity database.  This is the main repository of activity information.  It includes information from the billing system.  Reporting can be done at the procedure level detail, by account or in aggregate.
• Patient Level Database
  The “Punch Line” of the Business Line Management system is the ability to match the activity to patient demographic, financial and clinical data.  That is the function of the Patient Level Database.  It enables you to link critical information about the case. When this is matched to cost, the world of cost and profitability (by anything relevant about the case) is now open for your analysis.

Benefits

Matched to our net revenue model, the ability to determine “true cost” by business line leads to the ability to tell true profitability by Business Line.

Business Views

Features

• No learning curve
• Purpose-Specific