How established standards in healthcare cost could be made possible

Mrs Artirat Charukitpipat, Chief Executive Officer at Bumrungrad International Hospital, talks about Bumrungrad’s system of effective health resources management, how it helps establish standards in healthcare cost, and how it benefits patients.

The cost of private care could be difficult to justify for some hospitals, but Bumrungrad International Hospital in Thailand finds a way to efficiently do this through establishing standards in determining and controlling medical care charges such as medicine costs, room fees, doctors’ fees, lab costs, and diagnosis costs. 

Mrs Artirat Charukitpipat, CEO at Bumrungrad International Hospital, underscores the importance of the implementation of the Utilization Management (UM) and Utilization Review (UR), a system of effective health resources management that stems from the general past practice where price control mechanisms for room rates, medicine costs and the like were of various standards, relying on different calculation methods, and without any particular governing rules, thereby, giving patients the idea that medical fees are expensive.

Tackling and reviewing cost

Bumrungrad implements UM and UR in line with its goal to operate with accountability, transparency, and fairness in accordance with the principles of good governance and ethics.

The hospital uses fair cost calculation methods of international standards like those used in the United States of America (USA) or a “pay-per-service” approach. Currently, Bumrungrad uses this copyrighted system from the US to learn the best practice and apply it to the hospital’s operations, with particular codes or medical cost calculating formulas, which vary with the complexity of the disease, treatment levels, or surgery methods. This is to maintain medical fee standards that are equally fair to all patients according to the hospital’s beliefs in accountability and transparency, which helps reduce inequality and confirms its reliability.

Meanwhile, its UM Department was set up to operate in line with three main principles, medical necessity, appropriateness, and cost-effectiveness, that are consistent with providing value for patients’ total clinical experience.

Treatment is given as required by medical necessity. For example, for a patient with a tumour, whether a lab test is needed for diagnostic assessment is determined following the UM standards benefiting the patient, instead of only depending on the doctor’s discretion. Thus, both medical necessity and systemic approach of international standards are taken into consideration.

Meanwhile, appropriateness refers to the suitability of treatment approaches considering frequency and duration. For example, just one doctor’s follow-up visit a day may be sufficient for a patient with a non-serious disease and no serious symptoms. Without the UM Department, the patient could get three such visits and incur higher costs inappropriately.

Understandably, UM addresses treatment effectiveness in relation to costs. For example, where a patient requires prostate surgery, he can get either a conventional operation by the surgeon only or robotic surgery.   On the whole, the latter results in a smaller surgical wound, less pain, fewer days in the hospital, more precise performance, and fewer possible side effects. While costing a little more, the robotic surgery seems more effective and yields more “value for money” and thus will be recommended to the patient.

Maintaining standards 

Each hospital has standards to maintain. At Bumrungrad, the commitment to “drive the organization towards world-class holistic health care, upgrading it to a quaternary care hospital, at the top of medical care pyramid” is the top priority.

Mrs Charukitpipat emphasises that the hospital provides highly complex medical care with advanced innovations, including the use of advanced drugs that require highly skilled and experienced medical personnel. It is also engaged in research and development seeking innovations, drug trials, diagnoses or surgery in rare or complicated cases, and expand negative pressure room facilities. Maintaining these standards, of course, come with a cost.

As regards drugs and service costs and process costing, each hospital has its own approach in costing the various parts, which include maintaining the standard quality, drug inspection, drug inventory and storage, accurate drug dispensing, hiring pharmacists, and ensuring that the drugs in storage are still safe and in good condition and not nearing expiry. 

For example, it is necessary that cancer drugs be in stock and readily available, at the required temperature and humidity levels to ensure their efficacy. As a standard practice at Bumrungrad, any items nearing expiry are to be discarded.

Moreover, highly innovative technology is also part of Bumrungrad’s commitment to patients. For example, its drug dispensing robotic system has helped reduce medication errors that could be caused by the manual process. The ultimate goal is the zero-manual process, which should most enhance patients’ safety, the most vital key to hospital business operations. Obviously, each hospital is likely to have its own different process costing.

Bumrungrad International Hospital also launched telemedicine in late 2019 to improve accessibility and patient experience. Since the beginning of the COVID-19 pandemic, the hospital quickly expanded telemedicine service hospital-wide in March to respond to the surging needs of patients. With the patient-centric design, the service is easy to use even for ageing people who are unfamiliar with technology. Even after the pandemic settles down, Bumrungrad plans to keep expanding its telemedicine system.

Further, Mrs Charukitpipat points to future healthcare industry trends, which prompted Bumrungrad to invest in the big data management system called Bio Computing Platforms (BCP), as one of the first in the world. This system makes it possible to link the patient’s DNA data with the hospital’s data in the Electronic Medical Record (EMR) easily and quickly.  The hospital also focuses on personalized prescription medicine or predictive medicine, which involves genetic testing and offers several clinical benefits.

All these developments and future plans aimed at improving patient experience as they come for treatment are included in calculating the cost needed to continuously provide excellent care to patients. With standards in cost calculation, however, patients and healthcare providers are guided accordingly.

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