Value Analysis Leadership Interview – Matthew Rutberg— Program Manager, Value Analysis – Children’s Hospital of Philadelphia (CHOP)

Pictured with Matt is his Value Analysis Program Team

(VAMag) Could you tell us a little bit about your professional history and how you got into value analysis?

Matt: I have been with CHOP this August at least seven years. And before that I was with a GE capital,  the financial arm of General Electric,  for 12 years just out of school.  So, I didn't have healthcare experience. I got to a point in my career at GE where I wanted to do a little something bigger than myself. My wife is a nurse. She would talk about what she was doing. Comforting and caring for people, holding people's hands when they were literally dying. Then she would ask me how my day was, and I hadn't really a great answer.

We were thinking about having kids and  having a legacy where daddy worked for a company that did good things and he cared about people more than himself. So, at that point in time,  I investigated healthcare. I just don't know why I didn't think that healthcare was a business.  Very quickly, I saw many opportunities in healthcare for process improvement people, which was my expertise from GE. A  lot of my career at GE was being a Lean six sigma master black belt. I saw an opportunity at CHOP and applied.

In the first year, there were a lot of different projects I was involved in from surgical flow to patient flow. But  eventually in year two or three there was  an operating plan project that was initially called CHOPtimize that was geared toward saving $45,000,000. I was the process improvement person on the team that was aligned to the senior leaders on that project. Joni Ritter, who's the VP of supply chain at CHOP, was the champion of that project.

It was centered around money, but at that point in time there was a lot of discussion around value equation and how it can’t be just about price and it must also be about safety and outcomes. So, we teed it up that way and had a lot of success  for the two and a half, or three years that it was on the operating plan.

When the project was at a certain point of time, there was an opportunity within supply chain. I never thought I was going to be a supply chain person, but that's how I entered supply chain. I was the capital manager for two years and then finally, there was a need for a traditional value analysis manager that centered on the need for  all new product introductions to be reinvented.

We had serious safety events for which we conducted some root cause analysis. It was in part due to this process that I suggested to management that although I didn't care if it was me doin it, we should do something different with value analysis. As we talked more about the concept and how we could structure it and what the vision was, I stepped into that role. So, it was a net new role. This is our CHOPtimize Program and I’m our value analysis program manager.

 

(VAMag) With VA being a natural evolution of the triple aim for cost, quality and outcomes.  How does your Lean Six Sigma background help you in your role as value analysis program manager?

Matt: I think it helps to think about the situation more broadly than traditional value analysis. So, I think a lot of what I've read and learned and spoken about with my peers at conferences and conversations that traditional value analysis was a supply chain driven activity, narrowly focused.  For better or worse, not knowing anything about supply chain when I was hired or  when I took on this new role, my mindset was, well, I just don't want to understand this product or this purchase service but I want to understand how it's used and I want to understand the people who use it.

 

(VAMag) CHOP is known for being very innovative in cost management, specifically bringing cost management to the bedside with your nursing shared governance team. The program has been highly praised in the nursing community, specifically at Magnet. Could you share a little bit about that, the story of the successful bedside program with your value analysis?

Matt: There's two versions of it and there's two parts of the journey. There is the first part which was part of the operating plan, a project that was coined CHOPtimize and that had a three-year run. We'll call it a project. We never wanted it to be just another project so we reinvented ourselves to include the traditional value analysis type activities. When we were going through that first three years we asked ourselves how would we get to the desired outcome here?  How do we reduce costs while at the very least maintaining safety and outcomes and keep true value? Then we hit the jackpot, we realized you increase safety, increase outcomes, and reduce costs. That's total jackpot. And the biggest driver was an embedding it with the nurses who use these products or services.

You know you hit the jackpot when a nurse said, here's a problem at the bedside to solve. The data from utilization management standpoint also said yeah, we've got something going on and we've got  some information to support what you're saying. Next we quickly identified a big group of projects and our intent was to create this army of process improvement individuals

at the bedside, as turning all these nurses somehow into black belts as we went along. We tried to do some training and embed that culture and Lean Six Sigma into that group and it was hit or miss. I mean we had some big successes and I think those are some of the projects that have been presented at Magnet. There have been some  successes where for the very first time a nurse, a frontline nurse had a process improvement project that improved safety, and has cut some costs out of the organization.

 

(VAMag) Would you share a few key components or should I say your secret sauce for making your program a success at CHOP?

Matt: One strategy, I think, that differentiates us is that we developed a vision statement, and a mission statement. The strategic areas of focus, we call it that are our long term five to seven year strategy, which aligns to those strategic areas of focus like processes and systems, communication, relationships and data analytics.  These are the things that transcend value analysis  that could be part of any business.  Most importantly, we make sure that we align everything to our mission, our vision, and we make sure all of that aligns back to supply chains strategic direction as well as the organization's strategic direction and mission. So, I think that's one of the areas that is part of the secret sauce for sure because it seemingly doesn't exist in every organization.

 

(VAMag) When you say process, you’re not just saying, a new product request comes in and you bring it to the committee.  Your talking about how you define a project, correct?

Matt: I mean our prior VA program really wasn’t well-defined. It wasn't a program. We talked a little bit about it in terms of the traditional value analysis work that we did around new product introductions. It was one person trying their best to get products that were requested and that patients and staff needed, but it wasn't reliable, wasn't repeatable, it wasn't down on paper. It wasn't facilitated by systems or data. It wasn't any of these things. And it wasn't my predecessors' fault or their predecessors In taking a step back and thinking about the whole program after we developed the vision and the mission.  We now know what the big processes are in play here that we really must think about.  We had to determine whether to re-engineer the VA process, or design a new process but either way we needed to reinvent it with our stakeholders in and outside of supply chain who said there where opportunities for improvement.

 

(VAMag) Speaking of your advanced VA model. You created a brand. It was a part of a major initiative and now has evolved into CHOPtimize. Could you tell us how that unique branded approach helped your value analysis program gain the understanding, acceptance and ultimately thrive?

Matt: The word CHOPtimize came from that first iteration of the operating plan project and it was through a series of focus groups at the beginning of that project, that structure, that put the framework and fundamentals together for that Major initiative.   We took it to probably 10 to 15 focus groups, hundreds of people and asked them for a name that we can gravitate towards.  What we were after was really creating an identifiable brand. When you think of Apple, when you think of McDonald’s, you can think of any of these companies for better or for worse, whether you hate or love them, you identify with their symbol & brands.

Therefore, we wanted this to be embedded in the culture of CHOP as a value mindset forevermore. And so having something to gravitate toward like an anchor was important. We set out and we developed a name. We also worked carefully, believe it or not, with our marketing and PR teams to develop a logo to create stationary, and PowerPoint templates.  Whenever you saw a leadership briefing, a meeting, a one on one conversation, you would see that logo, you would see that brand and you would start to think about what  the brand is all about? And if you didn't know, hopefully you would ask about it. 

Again, it's about value added. As we came to the end of the three-year run on the operating plan and we were thinking about how to revamp our traditional value analysis program, we said to ourselves, well, we've got great traction on this word CHOPtimize and the value set and the mindset and the projects that we've done and relationships that we've built.  Why not build on this further?

 

(VAMag) In today's VA world, access to good data is the key to every team success. How does your program sift through all the available data and evidence to find cost effective quality value analysis results.

 

Matt: Our differentiator is what we termed advanced analytics. That was when we set out two years ago and we said, what’s our vision, what's our mission, what are the strategic areas of focus? This ability to incorporate clinical information because it's around a value equation was key to what I really was focused on. And so,  while we have a variety of traditional ways to look at costs and inventory, we have internal  information that we can look at it, we have our GPO tools that we look at. They're very traditional in a sense that they focus on finance, inventory management and cost. We needed to figure out how do we embed the numerator of the value equation, the safety and the outcomes that was one of our primary areas of focus.

 

(VAMag) From a big picture standpoint, where do you think value analysis is going in the next three to five years?

Matt: I can answer it in two different ways. From what I'm hearing from my peers, and my readings, I think VA will become more towards what we've done in the past two years.  That is making your value analysis program a true program and going from the one person show with a supply chain focus and limited scope.  Instead expand the process to be more utilization management minded.

I do hear that other organizations are beefing  up their value analysis programs by hiring more people.  I hear that they're building some of these process improvement groups as we have done at CHOP which of course I am a proponent of.