Takt Time and Value Added Time in Surgery and Healthcare Processes

By:  David M. Kashmer, MD MBA MBB

 

These Tools Are Valuable

Two of the most undervalued tool sets in healthcare are the Lean and Six Sigma tool set.  We hear the common refrain from physicians, nurses, and healthcare workers that Lean and Six Sigma tools, along with other statistical process control tools, are not useful in service industries–particularly not in healthcare.  In our experience, this isn’t correct.

 

It’s A Matter Of Training

Often, healthcare workers are not trained in these tools and therefore find little value in them.  However, in our experience, with training and understanding healthcare workers find these tools just as useful as the broader audience that uses them frequently.  In fact, many of the tools for which healthcare workers are looking to articulate certain words or ideas are already worked out in the well-know tools of statistical process control.  These can be quite valuable in healthcare and other service lines.

 

Sometimes We Use “Stealth Sigma”

Our team has experience with turnarounds and realignments in more than five trauma centers where we have found the Lean and Six sigma toolset to be invaluable.  We often have to change the moniker associated with this set of tools so as to avoid being too off-putting towards our healthcare colleagues.  Sometimes we call them “statistical process control” so that there’s less pushback caused by use of the term “Lean” or “Six Sigma”.  In fact, some colleagues have a term for the type of deployment where we avoid “Lean” and “Six Sigma”–those deployments get called “stealth sigma”.

 

Many of us on the team were trained in healthcare and currently practice clinically.  We understand the skepticism of our colleagues as we initially had it ourselves before we were trained in the tools.  Healthcare colleagues, here’s an important headline:  many of the tools you are currently re-inventing in your various fields have been worked out.  There’s even processes to use them.  They’re called Lean and Six Sigma.  Ok, stepping down off soapbox…

 

It’s only natural for us to be biased and a little evangelical.  After all, several of us are Master Black Belts (degrees of Six Sigma education have names that sound like karate belts) in Lean and Six Sigma.  We are accredited by various bodies throughout the United States.  Until we learned these things, we didn’t understand that they yield an ability to improve healthcare.  Here, allow me to stop testifying and to start telling you some of our experience as we focus on two useful Lean tools.

Let’s Talk About A Case

 

A healthcare system was having issues with stressed workers and backlog.  The concept of takt time was easily applied to demonstrate issues with the system.  Takt time represents the drum beat of a service line.  Another way to describe it, and one we often use with healthcare workers, is as the heartbeat of their patient.  The takt time is the time required to produce one unit of whatever the service line is producing.  This can be a patient admission, a surgical procedure, or something similar.  Takt time is an average and of course there is variability of the rates of production in practice.  However, takt time gives us an idea of what the drumbeat of the situation should be based on customer demand.

 

Definition of Takt Time

Takt time can be determined as the total available time to work divided by the demand for a situation.  That is, if, after breaks and other issues there is one hour available available in a day to actually do work and there are three patients that usually show up to the hospital (the demand on that system) in that hour to be admitted, the takt time for admissions is one third of an hour per every admission.  Said differently, it’s 1 hour available to do admissions / 3 admissions to be done.  This is one third of 60 minutes or approximately 20 minutes per admission.  Concepts like these give us an idea of what the drumbeat of the system needs to be.

 

We can use takt time in many ways.  One of the most useful ways is to pair it with a visual diagram of the process.  This type of diagram is called a value stream map.  Value stream mapping is very useful to better understand processes and services.  We can get a sense of what the drumbeat is in our organization and, based on mapping out the times associated with different portions of our value stream map, we can figure out how long it actually takes us to produce one unit of whatever we are trying to accomplish.  We can compare the two.  A value stream map gives us an idea of how the speed at which the process usually performs compares to takt time.  If takt time is 20 minutes per 1 admission, yet it usually takes us 40 minutes per 1 admission, we probably need to look for where we can cut wasted time and improve the process speed to be closer to takt time.

 

We can then see if there are discrepancies between our takt time, which is the drumbeat required, and our actual time to produce what we are trying to produce.

Focus On Value Added Time (VAT)

 

Another useful consequence of the value stream map is something called value-added time.  A troubling statistic often taught in Lean and Six sigma courses is that, in most systems, only approximately 1% of time used in the system is spent adding value to a product, service or patient. The “what adds value” is defined as that benefit or item for which the customer will pay.

 

In healthcare there are some special issues in application of this definition.  For example, who is the payer in the situation?  When we say value-added time as anything for which the customer will pay, who is the customer? We usually use a third party payer’s perspective as the answer for “who is the customer” because they are usually the ones actually paying for the services and systems.  Rather than talk about who should be paying for services in American healthcare we, instead, focus on who does.  In this respect we treat the third party payer, the source of funds, as the actual entity paying for use of services.

 

This also has some interesting consequences.  The third party payer, in fact, bases their payment on physician, surgeon or healthcare provider notation.  In fact what they actually are paying for is the tangible product they see which is the note.  Again, the note the physician, advanced practitioner, or healthcare provider supplies is what the third party payer reimburses.  In fact, they also use that as a rational to decline payment.  Consider how, if we gave a service but didn’t write it down, we would not be reimbursed.  This is part of how third party payers control costs whether they mean to or not.  We may have done several procedures, yet it is unlikely we would be reimbursed if we didn’t write down exactly what we did with clear and often exact documentation.  The note is the product for which the provider is paid.  Of course, without rendering the service there can be no note.

 

We feel strongly that it is improper (to say the least) to write a note based on the services or procedures that were not performed.  This is likely fraud in most cases and we are concerned about this.  We do not suggest writing notes on patients for procedures or care that was not delivered.  However, we acknowledge, in fact, a strong focus on the value chain for healthcare needs to be on the production of a medicolegally compliant, provider-protective, and exact note that satisfies the ever-increasing regulatory requirements of third party payers. That said, at the end of the day, what third party payers pay for is the services given as represented by the note.

 Apply VAT Concept To Everyday Processes

 

Let’s return to this concept that only 1% of time in most systems is spent adding value to a patient, process or other entity.  Experientially, this seems to be true.  When we have mapped out value streams in healthcare we have determined that again, that only approximately 1% of the time is used to actually add something that the third party payer will eventually reimburse.  A 4 day hospital stay related to cholecystitis is reimbursed with one global payment based on service as represented by the note.  Are there any opportunities to streamline note-writing, patient care, and cholecystectomy performance to decrease the amount of time spent in non-value added activities?  (You may be laughing, because the answer is clear to anyone who has worked in healthcare:  yes of course–there is a great deal of waste and re-work.)

 

The fact that only about 1% of time in a system is value-added time is often interesting and counterintuitive to the project group until they see the numbers. Once the amount of non-value added time is established and made tangible it becomes much more straightforward to reduce this time.  It is useful to reduce non value added time because much of non value added time is waste.  There are exceptions as you can imagine.  (Sometimes one process has to be completed in preparation to allow a value added step later.)  However, making the amount of non value added time crystal clear, tangible, and visible on a value stream map greatly improves processes and consensus building among healthcare providers, nurses and other allied health practitioners.

 

Use These Two Tools Together

We suggest, in our practice, to focus on these two tools as important adjuncts to process development. Again, takt time gives us a sense of our patient’s heart rhythm and we can often see how our processes are functioning relative to this concept of takt time.  For more information regarding takt time, value stream mapping, and value added time we invite you to visit Wikipedia or a Lean Six Sigma site after a google search.

 

Remember, to all our friends in healthcare:  we’ve been there and feel your pain.  We are surgeons, advanced practitioners, and nurses too.  Let us tell you:  the tools for which you are looking, or the ones you are re-inventing, have already been worked out and are called Lean and Six Sigma.  Feel free to borrow our wheel anytime rather than working out how to build your own.

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