British Columbia NICU Bed Allocation Case Analysis

Background: The executive director of BC’s Neonatal Services Program (BCNSP) and the officials of BC’s Ministry of Health Services (MHS) have been trying to decide whether or not to increase the neonatal ICU bed capacity in the province. This was due to a report in 2007 – 2008 that indicated that the province sent 98 expectant mothers and newborns to the US for treatment. This decision needed to be made also due to pressure coming from the media. For example it was an article by the Globe and Mail that was discussing the need for more beds and an actual national birthing plan. This is when the director was asked to suggest bed allocations among over areas of improvements for the situation.
Issues:
It states in the case itself that this is an issue because health care costs in BC were rising and the provincial government was pressuring them to avoid increasing spending. At the same time it’s also very expensive to send these mothers and newborns all the way to the US to get treatment. Not only is this costly but sending these patients over also places emotional stress on families. Some other issues could be projected as risks that involve scope and functionality, including the budget, schedule for this decision n and operations associated. If this decision isn’t carried out properly or isn’t performed optimally, it’ll result in less efficient operations, user dissatisfaction and overall lower functionality. There’s also scheduling risk considering there’s pressure to come to a decision from various authorities and clients. These risks come from when the procurement and processes takes longer than expected to execute. As mentioned before there is also a cost risks that comes from an estimated budget, meaning that the actual project cost could be higher than the budget. Finally another possible issue could be the operating risk after the decision is implemented. If the beds are not maintained over their lifecycle or the cost of maintenance is higher than once though it can become an issue.
Analysis:
This was when the MHS asked the executive direction of BCNSP for some suggestions such as bed allocations and other improvements to address the situation. Firstly the BC health system itself requires the MHS and the Health Authorities (HA), with the HAs responsible for delivering the health care within the province. The MHS is the one funding the Has who then allocated services and funded the operating budgets for hospitals. These two layers controlled how and where capital funding would be directed. The NICUs are the beds that to be allocated and help provide vital care for sick newborns. The case states that hospitals were divided into a total of five different levels of care based on ability. The director, for the purpose of the analysis, estimated an unlimited number for Normal level beds in BC. She also estimated the fixed operating and variable costs along with physician fees for Level III, II and I beds. Although there was a certain patient level of care versus hospital level of care the directors study indicated that sometimes beds offered a higher level of care than required; for example a lower level neonate was treated in a higher level bed because there were no extra beds available which affected not only patient length of stay but also hospital costs. The data also didn’t specify between LOC requited by patient and LOC offered which resulted in no data for LOS by level of care required. Because of this we can’t be sure that she acquired accurate numbers and therefore must make assumptions.
The demand also needed to be figured out and this was done by analyzing the births and deaths in BC. This would help determine the required capacity limits. To figure out how to allocate the beds properly the director also had to consider routing along with capacity. The most important efforts made were to keep babies and mothers as close as their home as possible. This also affects cost because sending them to the US costs almost four times as much then treating them in BC. Overall the director needs to recommend a plan to allocate the beds that not only avoids increasing the operating budget but also avoids sending the newborns and mothers to the US. She needs to make this decision using the information available to her and present those relevant to the final decision.
Recommendations:
Some recommendations I would offer would be to double check the costs and benefits before coming to a decision. The direction seems to be making a lot of assumptions and estimates and needs to prepare for risks and how to mitigate them as much as possible. For scope and functionality involve the user’s involvement extensively during the functional and design process. Then continue their involvement during the design process to make sure that user satisfaction, integration and functionality remains high. This would help properly allocating the beds according to the needs of the mothers and newborns. There should be an engagement between the members involved with the NICU beds to assist with the process. The cost risks should also be mitigated by making sure the budget is based on proper information and includes contingencies for any unseen costs or risks. Finally all the beds for each level should be examined to mitigate operating risks. Meaning some specifications regarding performance should be included to ensure that the beds perform and function as expected. A team should be engaged to review the specific preparations and make sure the beds are allocated properly. Another recommendation is to involve user groups to maximize operational efficiencies when it comes to handling the allocation of these beds and their day to day operations. Some overall improvements or objectives they can also set is to provide care centered around the patients need by making sure the environment is up to standards. This can be done by improving the delivery care by creating the most productive patient access and patient flow so that way the hospital can remain effective and not send patients to the US instead. This can also be done by supporting the needs of the staff, physicians, patients; visitors etc. and improve the operational efficiency/capacity utilization.
Reference:
Gregory S. Zaric, Derrick Fournier “British Columbia NICU Bed Allocation”. Harvard Business School Case 910E16, September 2010