PwC Healthcare Roundtable – 1st quarter 2018

DaisY: Setup and operational management of an outpatient surgery center


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The PwC Healthcare Round tables organized quarterly by PwC, are exchange platforms for hospital directors from French-speaking Switzerland. Topics are announced a few weeks in advance and will cover digitalization, outsourcing, the “supply chain” concept, “fee per procedure” payment, coding and pricing, as well as integrated care.

At our Q1 2018 Round table, we were delighted to host Brian Oosterhoff, operations manager of the DaisY outpatient surgery center of the eHnv (Etablissements hospitaliers du Nord vaudois). Mr. Oosterhoff provided the group with his unique insights and lessons learned on the setting up and operational management of an outpatient surgery center.

Quick overview

Ambulatory (outpatient) surgery is suitable for a large number of procedures and is not limited to minor surgery. All types of patients are eligible for this type of procedure and age is not a limiting factor. Indeed it is even recommended to use outpatient surgery for the elderly to avoid the loss of independence and cognitive decline related to hospitalization. In each case, it is imperative to analyze the patient’s context and environment to ensure that someone is available upon the patient’s return home. The evaluation is done by the surgeon and the anesthesiologist before the surgery.

A little less than 10 years after its opening, DaisY treats more than 3’500 cases per year, has an operational staff of around 15 full-time equivalents (without surgeons) and generates an income of CHF 5.6 million with an EBITDA margin of around 6%.

The most important surgeries in terms of volume are related to ophthalmology and orthopedics, far ahead of general surgery and gynecology. The center receives an average of 17 interventions per day, which results in a room occupancy rate of around 70%. The “length of stay” of a patient is on average 3.5 hours.

Success factors

Brian Oosterhoff draws in part on the 10 key recommendations in making day surgery happen published by the European Observatory on Health Systems and Policies in 2007.

By adapting them to the particular context of DaisY, he mentions in particular the following points as success factors:

  • Separate the flows between outpatient and inpatient surgery. The building of separate infrastructures is the best way to do this;
  • Separate the healthcare teams and combine it with a major investment in staff training. Indeed, specific skills are essential. The branch is organized in MOOC (Massive Open Online Courses) and in congress thanks to the International Association for Ambulatory Surgery. The training goals are multiple and cover the particularities of outpatient surgery such as analgesia as well as the follow-up of the patient so as not to make him/her sick thanks to “care maps” which allow the results to be as predictable as possible;
  • Invest in flexible infrastructure. The flexibility of the staff but also of the equipment is essential. The DaisY centre has been equipped with armchairs that can be converted into an operating table; this saves time. The admission and preparation of the patient are also very important. The medical staff takes care of this task but also of more technical work such as operating protocols script/typing as well as post-surgery follow-up of the patient. Always at the infrastructure level, the positioning of a sterilization unit near the operating theater is important (even if a large part of the equipment is for single use) as well as the open architecture that allows optimization of the work of the anesthesiologist. It should also be noted that surgeons dedicate a full day to the center in order to avoid going back and forth between the center and the hospital.

Challenges

Several major challenges hinder the use of outpatient surgery. We can quote, among others:

  • Pricing: considering outpatient surgery as standard and inpatient surgery as an exception comes up against a pricing problem in Switzerland. The new TARMED has a significant negative impact. Based on the type and number of interventions perfomed in the past, DaisY estimates that its revenues may decrease by approximately 20%. However, it is expected that due to the price decrease, a certain compensation through increasing volumes may occur. Therefore, the actual future impact is unclear at the present time;
  • The setting up of follow-up care of the patient: patients safety net and wellbeing are crucial in the field of outpatient surgery. Medical follow-up by a general practitioner at the patient’s home, often cited as an indispensable relay, is really not necessary if the patient is well informed about normal and abnormal situations in which it is imperative to call;
  • The balance between medical and administrative work: The part of the work dedicated to administrative processes such as the collection of statistics or indicators for medical societies takes up a lot of valuable health professionals’ time. The positive effects of simplifying clinical processes should not be offset by making administrative tasks more complex;
  • The alignment of incentives: this should not cost the patient more (which is fortunately not the case in Switzerland) and the hospital should not earn less for outpatient procedures than it would earn for the equivalent procedure if conducted as an in-patient procedure. The current context requires them to offset the deterrent effect of the tariff by reducing operating costs. This is possible in a dedicated center, separate from the hospital complexity and equipped with an efficient and flexible team.

In addition, the development of outpatient surgery must be accompanied by a reduction in inpatient capacity in order to ensure consistency. There are many advantages to reducing the number of beds. It has long been known that hospitals are particularly problematic places in terms of:

  • hospital-acquired infections (“Up to 7% of hospitalized patients will present with a healthcare associated infection during their treatment”);
  • loss of independence for elderly patients (“Loss of self-control, profound isolation, dependence on others, fear of death, and loss of usual frames of reference (during hospitalization for example), are all factors that can affect the patient’s independence”);
  • medication errors.

Perspectives & conclusion

Brian Oosterhoff stresses the importance of continuing the shift to outpatient surgery by increasing the number of surgical procedures performed on an outpatient basis but also by encouraging a transfer to office-based surgery. The participants were in complete agreement on the concept, even if the implementation remains quite different from one structure to another.

The digitalization of the patient’s journey as well as the simplification of processes (standardization of equipment for example) should continue to support the shift to ambulatory care by improving efficiency. This element was very well understood and anticipated by the participants even if the challenges are considerable, mainly in terms of coordination and integration of the different IT systems. Optimizing resources (mainly purchasing) and strengthening the degree of autonomy of all actors are of course crucial in this context.

In conclusion, the potential of outpatient surgery is still under-exploited in Switzerland but a step in the right direction has been taken with the February 2018 decision by the Federal Department of Home Affairs (FDHA) that six groups of interventions would be covered exclusively via outpatient care in the future. This decision aims to create a uniform regulation of these interventions for all insured persons in Switzerland, with an entry into force on 1 January 2019.

Nevertheless, the exclusive nature of the list may slow-down or limit any industry-wide shift towards ambulatory procedures in Switzerland, which until now has been led by a few pioneering centers. To further incentivize the usage of these innovative acts, DRG-type financing, but without its lower limit, could be the key to success.

Quarterly PwC Healthcare Roundtables

Are you interested in participating at our next PwC Healthcare Roundtable on 16 May 2018 in Morges? Do not hesitate to contact us (pascale.boyer.barresi@ch.pwc.com) and we will be happy to keep you informed of the theme as well as of subsequent events in the French-speaking part of Switzerland. We look forward to seeing you there!

Contact Us

Pascale Boyer Barresi, CFA
Senior Manager
Deals | Valuation & Modelling | Healthcare & Life Sciences
+41 58 792 97 42
pascale.boyer.barresi@ch.pwc.com

21st CEO Survey: Key findings from the Insurance industry

Maintaining optimism while grappling with transformational changes

According to PwC’s 21st CEO Survey, insurance CEOs continue to report that theirs is one of the most disrupted industries. However, their outlook is increasingly positive. Half of insurance CEOs say that they believe global economic growth will improve over the next 12 months, up from only 19% in 2017. And more than 90% report that they are confident about their own organisations’ revenue prospects over the next three years (43% are very confident and 49% are somewhat confident).

Among the many reasons for the positive outlook is that the anticipated disruption from incoming competitors (e.g. InsurTech and digital platform players) hasn’t materialised to the extent that was feared. Indeed, partnership with new entrants rather than rivalry is the order of the day. Moreover, new risk mitigation opportunities – sensors and cyber assessments, for instance – are opening up.

But, having perhaps overestimated the impact of outside threats and short-term disruption in the past, could insurers now be underestimating the urgent need to become digitally-enabled, customer-focused organizations with flexible business and operating models?

Read the full study

 

Contacts

Immy Pandor
Insurance Sector Leader
PwC Switzerland
immy.pandor@ch.pwc.com

Patrick Maeder
Financial Services Leader
PwC Switzerland
maeder.patrick@ch.pwc.com

Jan Ellerbrock
Head of Insurance Management Consulting
PwC Switzerland
jan.ellerbrock@ch.pwc.com

Russian Football Premier League: A comprehensive study of the economics of Russian football

Regular football fans – and football industry insiders – have plenty to look forward to in Russia. In the run-up to the 2018 FIFA World Cup in Russia this summer, our colleagues of the Sports Consulting Practice at PwC Russia has joined forces with the Russian Football Premier League to survey the country’s top league. In the report they explore areas such as infrastructure, commercial deals, attendance and fan engagement – and benchmark the finances of the cream of Russian clubs against their counterparts in the leading European leagues.

In this blog post we introduce a few of the key findings by way of a taster. The authors − Oleg Malyshev, Aleksander Kardash and Anastasia Shalimova at PwC Russia – report that top Russian football is making up ground, both in sporting and business terms, on the leading leagues in Europe. The four most promising developments are as follows:

State-of-the-art infrastructure and technology boosting fan enjoyment and revenues
Currently in its sixteenth season, the Russian Football Premier league has formulated a strategy designed to maximise commercial revenue over the next few years. By providing better insights into the economics of the Russian game, the first survey of the league, conducted by PwC and entitled Russian Football Premier League: a comprehensive study of the economics of Russian football, is an important stepping stone towards this goal.

Obviously the upcoming FIFA World Cup, to be held in Russia this summer, is generating a great deal of excitement. But the league – and its member clubs – are determined to actively leverage the effects. The World Cup is giving clubs a great tool to attract people to watch the game, both regular fans and VIPs. Many of the stadiums built for the World Cup will debut this season. The new Saint Petersburg Stadium is already breaking match-day attendance records, new arenas are due to open in Ekaterinburg and Rostov-on-Don, and Dynamo Stadium in Moscow will soon reopen after a massive overhaul. The RFPL is also spearheading the adoption of new technology, with a new fan identification system about to be launched and video assistant referee systems currently being installed in stadiums.

Economic innovation also kicking off in Russian football
Technological innovation is being accompanied by the adoption of state-of-the-art business approaches. Russian football is becoming increasingly popular abroad, watched by fans in more than fifty countries and regions including Europe, Central and South America, Israel, China and the UAE. Twenty companies have purchased broadcasting rights to RFPL matches.

This growing popularity is one of the reasons sponsors are becoming more interested in top Russian football. Alongside increases in match-day revenue we’re seeing sponsors pay more attention both to the league and the clubs. The league’s title sponsor is Rosgosstrakh, and other important sponsors include Nike and Liga Stavok, a sports book.

New venues and technology-enabled means of direct-to-consumer sponsorship activation (such as social media, email, SMS and chatbots) are making it more interesting for FMSG companies to invest in advertisement in football.

Online no longer a mere sideline
Online sales are a big deal across the entire league. Most clubs now have online ticketing and merchandise stores, building up a strong presence on social media. As a result, some clubs now generate up to 80 percent of their regular ticket sales via online channels – their own website and mobile apps or third parties such as online ticketing aggregators. Even the average club already generates around 40% of total sales online.

Clubs are also pretty savvy when it comes to driving attendance by using promotions or offering free tickets or discounts. While only a third of RFPL clubs already use customer relationship management (CRM) systems to provide personalised service and boost fan loyalty, nearly half of all clubs plan on adopting CRM systems during the season.

UEFA penalties forcing more prudent financial management
Because of UEFA Financial Fair Play rules designed to help clubs achieve financial sustainability by striking a balance between their income and expenditure, clubs are required to be more prudent in terms of what they spend, and look for more and more ways to boost commercial revenues.

This vigilance is bearing fruit. Having paid UEFA penalties under the current rules, the financial activities of several clubs continue to be monitored. But there were no fines for violating financial fair play rules in 2016-17. These financial improvements are resulting in healthier competition on and off the field, and more attention paid to young local talent.

Conclusion: plenty to get excited about in Russia, both on and off the field
While there are still areas for improvement, in this World Cup year there’s plenty to get excited about in Russian football, with promising new developments both on and off the field. Clubs have increasing financial incentives to improve their sporting performance, build the loyalty and engagement of their fans, and modernise the way they go about their business. And they’re increasingly harnessing this potential by adopting smart technology and business approaches.

If you’d like to find out more, check out the report − Russian Football Premier League: a comprehensive study of the economics of Russian football  – or get in touch with me to discuss the opportunities in football and other sports in Russia.

21st CEO Survey: Key findings from the Asset and Wealth Management industry

Optimistic CEOS and buoyant growth, yet disruption looms

There’s great confidence in the asset and wealth management (AWM) industry, but also acknowledgement that times are changing. While CEOs are optimistic about growth, they’re aware that they face challenges, although perhaps not the full extent of them. Those are the inescapable conclusions of PwC’s 21st CEO Survey in which 126 of the sector’s CEOs were interviewed.

While AWM CEOs are optimistic about revenue growth in 2018, they also report seeing a myriad of challenges. This contrast begs the question: Will the extent of potential disruption outpace the time needed to prepare for and react to it?

Accelerating technological change, more demanding customers, embedding the blizzard of new regulation – these powerful forces will transform, and perhaps terminate, some of the sector’s traditional ways of operating. The survey’s findings echo the recent report, “Asset & Wealth Management Revolution: Embracing Exponential Change,” which estimates that by 2025 global assets under management will have almost doubled – rising from US$84.9 trillion in 2016 to US$145.4 trillion.

Yet certain AWM CEOs seem to underestimate the widespread industry reinvention under way, with major changes to fees, products, distribution, regulation, technology, and people skills, and how a failure to properly navigate these changes may cut into assets under management and eventual profits. Perhaps this is due to the disparate nature of the sector. It ranges from global giants to active and alternative investment boutiques. Many AWM participants in PwC’s 21st CEO Survey lead relatively small shops, reflecting the entrepreneurial nature of the industry.

Read the full study

Contact

Jean-Sébastien Lassonde
PwC | Partner, Swiss Leader Asset & Wealth Management
Office: +41 58 792 81 46 | Mobile: 41 79 598 57 38
Email: jean.sebastien.lassonde@ch.pwc.com

Swiss Company Leadership and the Gender Divide (2008-2018) – Report

Earlier this month, PwC joined forces with the data insight company Business-Monitor to publish a new gender parity analysis of all companies registered in Switzerland about the development of gender inequality within the workforce over the past decade. “This report aims to bring a new perspective on the representation of women in decision-making positions in the Swiss economy and how the landscape has changed over the past ten years.(Swiss Company Leadership and the Gender Divide, 2008-2018)

Key findings

  1. Women are “stuck” at lower-level decision making roles and change is not about to occur. The research confirms that the “glass ceiling” metaphor is not a myth. In 2018, less than one in four decision-makers in Swiss businesses are women. Over the past ten years, this rate has consistently diminished, as in 2008, the proportion of females in decision-making roles was one in three.
  2. There is a surprising difference between female representation trends of Limited companies (LTDs) and Limited Liability companies (LLCs). Although gender imbalance is lower in LLCs, both types of legal entities have an unequal percentage of women in decision-making roles (16.8% for LTDs and 27.1% for LLCs, in 2018) and an uneven gender spread across the responsibility hierarchy. This trend has slightly improved over the last decade in LTDs but the data shows that this is not the case for LLCs. An overall 2.2% drop in females holding decision-making roles can be observed over the past 10 years. Although LTDs are the best examples of the “glass ceiling” phenomenon, it is harder to break in LCCs.
  3. Gender balance is poorer in newer companies. With the efforts undertaken by the Swiss government and other worldwide organizations to raise awareness for equal pay and representation, one would assume that newly established companies are the front runners in terms of balanced workforces. Surprisingly, research shows that this is not the case. Companies founded after 2008 have a higher gender imbalanced rate than pre-existing ones.

What’s next?

The striking statistical data raises important questions as to why these gender imbalances exist, what strategies companies can implement to tackle them and why it would be beneficial for them do so. Indeed, the report identifies a compelling business case for gender equality, which can only be achieved through: a clear vision, leadership engagement and an action plan engaging the entire workforce and key partners to be more Diverse & Inclusive. These actions can ignite the change so your organization can be part of the journey to gender parity across the globe.

To understand where your organization is today regarding Diversity & Inclusion, we encourage you to take our short survey. After completion, you will receive an assessment indicating the strengths and opportunity areas of your program. You will also receive indications on how you compare to the benchmark of other companies in your region and industry.

At PwC we are committed to becoming more Diverse and Inclusive through a number of ongoing actions, including the HeforShe program. Our active HeforShe ambassadors are committed to ensuring equal pay for our workforce by becoming EQUAL-SALARY Certified.

We look forward to engaging in conversations with you on this topic.

PwC Switzerland
Sue Johnson
Tel. +41 58 792 90 98
sue.johnson@ch.pwc.com

PwC Switzerland
Christina Yap
Tel +41 58 792 90 29
christina.yap@ch.pwc.com

PwC research “Time to talk”: what has to change for women at work?

Many organisations are working hard to improve the Diversity & Inclusion (D&I) of their workforce, many with a specific focus on gender balance at leadership level. There is no one single bullet which can solve this complex challenge, it takes: time, commitment, vision and resilience to foster an Inclusive culture where everyone can flourish.

Recent PwC research “time to talk” highlights three areas for organisations for focus on to accelerate progress:

Transparency and trust – a way of conducting business in which employers offer their staff a clear understanding of the expectations on both sides of the employment equation.

What employers can do includes:

  • Provide consistent, accurate, accessible information about career progression and pay scales.
  • Hold open conversations with employees on where they stand and what is expected of them to advance.

Strategic support – networks mobilising women. Women need proactive networks of leaders and peers who will develop, promote and champion them at home and in the workplace.

What employers can do includes:

  • Role models of both genders to look up to and learn from
  • Mentors who help navigate the path to success
  • Sponsors who can push her to the next level
  • A circle outside of work who reinforce and support career aspirations

Life, family, care and work – we are all facing increasing demands from all walks of life, parenting, community for example, there is a need to find organisation solutions that work for all.

What employers can do includes:

  • Offer an on and off ramp strategy and policy, educating managers how to deal with returners to work, focussing on communication and a toolkit
  • Flexible friendly workplace, it is not just enough to have the policy, visible support is required from top leadership and education
  • Little visible steps can make big differences, for example a concierge at work or childcare solution support

A Diverse and Inclusive organisation is reached, one conversation at a time…

Read more about the PwC research “time to talk” and download the full report here.

 

PwC Switzerland
Sue Johnson
Tel. +41 58 792 90 98
sue.johnson@ch.pwc.com

Disclose 27, Focus piece 4: PwC’s Experience Center

Disclose – PwC’s online magazine

«It takes people, digital technologies and trust to achieve top performance.»

Reading our latest issue of Disclose (disclose.pwc.ch/27/) you’re sure to get an adrenaline rush as we investigate a topic with particularly close connections to sport: high-performing organisations.

Focus piece 4 gives you an insight into PwC’s Experience Center:

Digitisation is sweeping companies of all sizes in all industries and areas of value creation. That’s nothing new. What is new is the high-performing approach adopted by PwC’s Experience Center as it guides its clients through digital transformation. PwC’s 28 similar experience centres worldwide produce concrete results and provide first-hand experiences, from strategy to implementation – all in next to no time. In this interview, Holger Greif, Leader Digital Transformation, explains how it works and why PwC’s Experience Center in Zurich has its expert hands full.

Read the full report here.

Contact

Holger Greif
Partner, Leiter Digital Transformation, PwC Schweiz
+41 58 792 13 86
holger.greif@ch.pwc.com

How healthy were hospital finances in 2016?

The Swiss healthcare sector is increasingly dynamic and competition-driven, with growing economic incentives. Our analysis of financial information from Swiss hospitals reveals that too many acute hospitals are not yet profitable enough.

On average the situation at psychiatric care facilities looks slightly better. Against this backdrop, many hospitals and clinics face major challenges when it comes to funding investments in the long term. Added to this is the fact that new healthcare delivery models, changing roles and digital technology will come to dominate the healthcare landscape as we approach 2030. Hospitals will have to be agile and open to innovation to be able to withstand this pressure and flourish.

Download an excerpt of the study alongside with analyses in interactive format on www.pwc.ch/hospitalstudy. The complete study is available in German and French.

If you have any questions, do not hesitate to reach out to us. We look forward to hearing from you.

Contacts

Patrick Schwendener, CFA
PwC | Director | Deals | Valuation & Modelling | Healthcare
Office: +41 58 792 15 08 | Mobile: +41 79 816 69 10
Email: patrick.schwendener@ch.pwc.com

Philip Sommer
PwC | Director | Consulting
Office: +41 58 792 7528 | Mobile: +41 76 516 1741
Email: philip.sommer@ch.pwc.com

Disclose 27, Focus piece 3: Fit for Growth – the smart way to cut costs, restructure and renew

Disclose – PwC’s online magazine

«It takes people, digital technologies and trust to achieve top performance.»

Reading our latest issue of Disclose (disclose.pwc.ch/27/) you’re sure to get an adrenaline rush as we investigate a topic with particularly close connections to sport: high-performing organisations.

Focus piece 3 gives you an insight into the topic Fit for Growth – the smart way to cut costs, restructure and renew

Companies across industries and geographies are realising that the only way to unleash profitable growth is to cut costs as rigorously as they concentrate on growing revenues. As with any living organism, there’s no profitable growth without equally robust pruning. To get fit enough to thrive in an increasingly tough environment, you need to focus on a small number of differentiating capabilities, align your cost structure to these capabilities, and organise for growth. In this article we look at how the world’s fittest companies have mastered these three components to achieve and maintain healthy, profitable growth – and at the principles that can enable companies in this country, to to prune their business for sustained success.

Read the full report here.

Contact

Niklas Hoppe
Partner, Strategy& Switzerland
+41 58 792 2875
n.hoppe@strategyand.ch.pwc.com

Disclose 27, Focus piece 2: Report on the lodging and tourism industry

Disclose – PwC’s online magazine

«It takes people, digital technologies and trust to achieve top performance.»

Reading our latest issue of Disclose (disclose.pwc.ch/27/) you’re sure to get an adrenaline rush as we investigate a topic with particularly close connections to sport: high-performing organisations.

Focus piece 2 gives you an insight into the report on the lodging and tourism industry:

Despite the strong franc, Switzerland has been able to maintain its reputation as a top destination in recent years. But for how much longer? To satisfy the high expectations of their guests, tourism providers have to offer them a lot for their money. This calls for clearly positioned offerings and high-quality service. With well-trained staff, intelligent big data tools and smart cooperation, operators can provide people with authentic experiences and gain loyal customers and new market share in lucrative segments. To do this they need to aspire to perfection but at the same time be willing to accept that you can’t make every guest segment happy at the same time.

Read the full report here.

Contact

Nicolas Olivier Mayer
Partner, EMEA Industry Leader Lodging & Tourism, PwC Switzerland
nicolas.mayer@ch.pwc.com
Tel. +41 58 792 21 91