Friday, 20 March 2015 19:57

Value-Based Purchasing: A3 Lean Methodology Being Leveraged To Improve Results

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k geierHealthEast Care System is a community-focused, nonprofit healthcare organization that includes one long-term, acute-care hospital (126 staffed beds), three short-term, acute-care hospitals (500-plus staffed beds), outpatient services, clinics, home care, hospice, and medical transportation. We have 7,300 employees, 1,200 volunteers, and 1,500 physicians on staff.

A few years ago HealthEast created the "value equation" when value-based purchasing and value-based improvement came together, merging the quality and business processes:

table equation

This equation led us to look at new ways to foster improvement and create a value-based improvement culture by changing our approach – specifically, by using A3 Lean Methodology. A3 Lean Methodology leverages layered planning to link strategic goals with a strategy plan to identify what needs to be done to achieve those goals. A3 projects are time-based, focused initiatives that also link to the strategy plan.


Beginning Jan. 1, 2015, value-based purchasing shifted priorities, with healthcare entities going from placing an emphasis on the clinical process to clinical outcomes, efficiency, patient experience, and safety. Threshold and benchmark performance standards are also changing to this day, and healthcare providers are going to need additional tools and methodologies to improve performance.

One of the methodologies HealthEast has been using for the past couple years to improve our results for both value-based purchasing and other key projects is, again, A3 Lean Methodology. HealthEast began its improvement journey by first creating a value-based improvement philosophy through which the creativity, knowledge, and problem-solving abilities of front line staff and leadership are shared in order to identify and solve problems to create value.

The new Lean Methodology makes problems visible and turns entities into learning organizations. Through better processes you are able to decrease waste, lessen variation, and reduce burden on employees and physicians with built-in quality. This work creates better results and healthcare value in the form of better clinical quality, enhanced patient experiences, and improved cost-effectiveness.

This document will describe A3 thinking and the process of developing an A3 project using the A3 project template.

What is A3 Thinking?

It is all about the process of developing the A3 to get alignment and support versus simply filling in the document. The key stakeholders own the process. A3 Thinking facilitates discussion and agreement by telling a compelling story on one sheet of paper utilizing the scientific method (PDCA). It is a recognized and proven project management tool named from the size of the paper (11x17, or "A3").

A3 Project Roles

  1. Project leader: Single ownership trained on A3 thinking for planning and managing projects. Leads project team through A3 thinking process and manages implementation plan.
  2. Functional approver: Person who owns target processes and verifies need and alignment to strategies, coaches project leader through the duration of project, and signs A3 for approval to proceed.
  3. Team members: three to four people who do the work and understand the process. Subject matter experts who are called as needed.

A3 Lean Methodology is used when a deviation is identified. The deviation can be defined three different ways:

  1. Standard is not achieved
  2. Standard is achieved, but a higher standard is now required
  3. Performance to standard varies (not consistently achieved)

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Last modified on Tuesday, 24 March 2015 16:40

Kathleen Geier is the director of clinical and regulatory performance at HealthEast Care System in St. Paul, MN. She leads the strategic planning and oversight of government-required pay-for-performance and commercial payor clinical and regulatory performance measures. She is also a member of the Minnesota Statewide Quality Reporting and Measurement Committee for 2014-2016.