Reduced average length of stay (AVLOS)

Trend 3. Reduced AVLOS from improved quality of care increases productivity

New treatment methods, new medical techniques and protocols that allow patients to be treated with these methods and techniques and at the right level of care delivery, all support improved quality of care. This results in more rapid recovery for patients and shorter average length of stay (AVLOS).

Historically, however, two barriers have inhibited the introduction and application of this type of Modern Medicine: the inability of healthcare providers to introduce and apply ”best practice” and healthcare reimbursement systems that prevent opportunities for healthcare providers to drive quality improvements.

Research has indicated that the time lag from when medical best practice is proven to when it is implemented systematically in healthcare may amount to up to 17 years. The poor ability of healthcare providers to evolve and reap the potential of Modern Medicine, derives, in part, from an organizational structure of many healthcare providers that is historically influenced by a traditional split between ”the medical profession” and ”the administration”, with limited incentives for the organization as a whole to drive initiatives and improvements.

In addition, European healthcare systems have historically reimbursed healthcare on a per diem basis in certain countries. For example, both France and Germany have had thresholds for minimum required lengths of stay for patients in a hospital. in order for the provider to receive full reimbursement, in France called borne basse thresholds and untere grenzverweildauer (”UGVD”) in Germany. These reimbursement systems have provided poor incentives for healthcare providers to drive quality and productivity improvements.

The slow adoption of Modern Medicine, and timing differences in the implementation of DRG-based reimbursement by various healthcare systems, have resulted in an unbalanced adoption of Modern Medicine and large performance differences across countries. For example, there is significant variation in the AVLOS in Germany, France and Sweden, respectively, for the treatment of acute myocardial infarction and acute appendicitis, as well as for uncomplicated knee and hip prosthesis surgery. The AVLOS for acute appendicitis, for example, was 4.3 days in Germany, while the equivalent AVLOS was 4.0 days in France and 2.5 days in Sweden in 2014. For hip and knee replacement operations, the AVLOS in Sweden was approximately 50 to 65% shorter than in France and Germany in 2013.1

These trends create opportunities for pan-European healthcare providers to implement best practices across markets by transferring knowledge and experience between units and countries, thereby gradually decreasing the differences in the quality of care. In addition, AVLOS reduction also reduces personnel and other direct costs, as well as freeing up capacity to handle additional patient volumes. Continued implementation of Modern Medicine will iimprove medical results, reduce AVLOS and thereby improve the productivity.

1 The Swedish National Board of Health and Welfare, Helsedirektoratet, ATIH, Federal Statistical Office’s DRG Browser.