Two U.S. health systems, AtlantiCare in Egg Harbor Township, N.J., and Heartland Health in St. Joseph, Mo., have won the 2009 Malcolm Baldrige National Quality Award.
U.S. Commerce Secretary Gary Locke announced the 2009 recipients of the Baldrige Award on Monday. The award is the nation's highest Presidential honor for organizational innovation and performance excellence.
“The (Baldrige Award recipients) inspire other organizations to be more accessible, more efficient, more customer-focused and more financially sound,” Locke said. “They have raised the bar for innovation and organizational excellence.”
The 2009 Baldrige Award recipients were selected from a field of 70 applicants. All of the applicants were evaluated by an independent board of examiners in seven areas: Leadership; strategic planning; customer focus; measurement, analysis and knowledge management; workforce focus; process management; and results.
The evaluation process for each of the recipients includes about 1,000 hours of review and an on-site visit by a team of examiners to clarify questions and verify information in the applications.
AtlantiCare is a nonprofit health system in southeastern New Jersey, and the largest health provider in its region. From 2000 to 2008, the health system’s revenues grew from $280 million to $651 million, reflecting an 11 percent compound annual growth rate. During this time period, its medical center volume increased from about 34,000 to greater than 56,000 discharges – more than twice the state growth rates.
“The receipt of this award is not the end of our quality journey. In many ways it is just the beginning,” said David Tilton, Atlanticare’s CEO. “Baldrige Award winners have the opportunity and the responsibility of sharing our performance excellence strategies with other organizations in the country. We are looking forward to acting as mentors and role models to others who aspire to offer the highest quality of care and service to their patients and customers.”
According to Tilton, AtlantiCare increased its market share in the health system’s primary service area to a six-year high of 62 percent in the second quarter 2008 and improved its market share in the regional service area by 57 percent from 2000 to 2009.
In 2008, 90 percent of the free care in Atlantic County, N.J., was delivered by AtlantiCare. Three mission facilities caring for youth, homeless, and geriatric patients provide non-hospital charity care.
The other healthcare Baldrige winner, Heartland Health, is a not-for-profit, community-based healthcare system serving a 22-county market in portions of Missouri, Kansas, Nebraska, and Iowa.
Heartland has annual revenues of approximately $750 million. In fiscal year 2009, the health system exceeded the Moody’s and Fitch Bond current bond rating requirements for Days Cash on Hand and achieved performance in both rating agencies’ top 10 percent for total margin and operating margin.
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“Heartland is a unique healthcare system, comprised of four fully-integrated entities,” said Mark Laney, MD, Heartland’s president and CEO. “Heartland Regional Medical Center and Heartland Clinic provide our community with the best and safest care by managing acute and chronic disease, illness and injury in a clinical setting.”
Laney said Heartland is ranked in the top 15 percent of hospitals nationally for patient safety according to the HealthGrades "Best Hospital Scores." He said the health system has developed an organizational culture that applies Six Sigma methods within a “Process Improvement Model” to control costs, prevent rework and errors, and minimize the costs of inspection, tests, and audits.
Cost savings as a result of process improvement at Heartland have increased from approximately $8 million in fiscal year 2005 to more than $25 million by fiscal year 2009.
The Baldrige program is managed by the Commerce Department's National Institute of Standards and Technology in conjunction with the private sector. Named after Malcolm Baldrige, the 26th Secretary of Commerce, the Baldrige Award was established by Congress in 1987 to enhance the competitiveness and performance of U.S. businesses.
The award promotes excellence in organizational performance, recognizes the achievements and results of U.S. organizations and publicizes successful performance strategies.
In addition to AtlantiCare and Heartland Health, the 2009 Baldrige Award recipients are Honeywell Federal Manufacturing & Technologies of Kansas City, Mo. (manufacturing), MidwayUSA of Columbia, Mo. (small business), and VA Cooperative Studies Program Clinical Research Pharmacy Coordinating Center of Albuquerque, N.M. (nonprofit).