Institute for Structural Development in the Healthcare System

The introduction of DRGs (Diagnosis Related Groups) as the basis for hospital financing (in 2003) brought competition to the in-patient sector of healthcare. The pressure this exerts on  each individual hospital - which is intensified by the lack of public funding together with a considerable rise in costs - has led to a fundamental structural change in German hospitals, the likes of which has never been seen before.
The response to this change lies in entrepreneurial thinking that extends beyond the (to date very restrictive) boundaries of the German hospital system. Management is replacing administration; a strategic approach and efficiency optimization are taking the place of coincidence and historical evolution. Successful models from other sectors are now being introduced to the healthcare sector, with initial process management models as found in the automotive and air travel industries, having already taken hold in the German hospital industry.
Through process optimization, processes can be streamlined, allowing whole hospitals or departments to work considerably more efficiently. In essence, the objective is the clear regulation of responsibilities and the standardization of a multitude of procedures. This means that processes can be optimized to such a degree that waiting times and down-time are reduced, thus allowing surgery capacity to be increased significantly. The use of “Best Practices” from other sectors to increase quality and efficiency in the German hospital system is a pioneering approach. The “Institute for Structural Development in the Healthcare System” has been instrumental in promoting this fresh approach.


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