Utilization of Failure Mode and Effects Analysis (FMEA) Method in Increasing the Revenue of Emergency Department; a Prospective Cohort Study

Introduction: The balance between revenue and cost of an organization/system is essential to maintain its survival and quality of services. Emergency departments (ED) are one of the most important parts of health care delivery system. Financial discipline of EDs, by increasing the efficiency and profitability, can directly affect the quality of care and subsequently patient satisfaction. Accordingly, the present study attempts to investigate failure mode and effects analysis (FMEA) method in identifying the problems leading to the loss of ED revenue and offer solutions to help fix these problems.

Methods: This prospective cohort study investigated the financial records of ED patients and evaluated the effective errors in reducing the revenue in ED of Imam Hossein hospital, Tehran, Iran, from October 2007 to November 2009. The whole department was divided into one main system and six subsystems, based on FMEA. The study was divided into two phases. In the first phase, the problems leading to the loss of revenue in each subsystem were identified and weighted into four groups using risk priority number (RPN), and the solutions for fixing them were planned. Then, in the second phase, discovered defects in the first phase were fixed according to their priority. Finally, the impact of each solution was compared before and after intervention using the repeated measure ANOVA test.

Results: 100 financial records of ED patients were evaluated during the first phase of the study. The average of ED revenue in the six months of the first phase was 73.1±3.65 thousand US dollars/month. 12 types of errors were detected in the predefined subsystems. ED revenue rose from 73.1 to 153.1, 207.06, 240, and 320 thousand US dollars/month after solving first, second, third, and fourth priority problems, respectively (337.75% increase in two years) (p<0.001). 111.0% increase in the ED revenue after solving of first priority problems revealed that they were extremely indispensable in decreasing the revenue (p<0.0001).

Conclusion: The findings of the present study revealed that FMEA could be considered as an efficient model for increasing the revenue of emergency department. According to this model, not recording the services by the nursing unit, and lack of specific identifying code for the patients moving from ED to any other department, were the two first priority problems in decreasing our ED revenue.