Grantham BA 431- Applying QFD in a Managed Care Organization

Applying QFD in a Managed Care Organization39
Managed care was introduced in the United States nearly two decades ago as a means to
maintain quality while managing costs. A managed care organization (MCO) contracts with
physicians, hospitals, medical equipment companies, and home health agencies to provide
services to its members (patients).
The MCO markets its services and actively enrolls people. Once enrolled, members
receive a handbook that explains how they can access the services offered by the MCO and
its affiliated providers. The member handbook has become a main source of information
regarding an increasingly complex array of benefits offered by the thousands of MCOs.
Designing the handbook and creating its content are, therefore, important components of
any MCO's business strategy. Unfortunately, a member satisfaction survey indicated that
members have a poor understanding of their benefits. When members are unable to
understand their benefits, the MCOs' member services switchboards are inundated with
calls, resulting in frustration and anger and further delaying patient access to the MCOs'
services. The MCO receives an average of 3,000 calls per day, with each call lasting an
average of 3.2 minutes. Approximately 50 percent of these calls involve issues discussed in
the member handbook. The MCO also spends more than $250,000 per year in providing
supplemental materials to its members as a result of inadequacies in the member handbook.
To improve the handbook and member satisfaction, QFD was used to redesign it. The
input for the QFD process was obtained through a series of focus groups. A total of 131
MCO customers participated in six focus group sessions. Participants were selected based
on two criteria:
1.
They had to have been members of a competing MCO—whose member
handbook was used for comparison—for at least two years prior to joining the MCO
being studied.
2.
They had to have been members of the MCO being studied for at least two
consecutive years.
The focus group process was then administered in two stages:
Stage 1. Participants were provided with a copy of the company's member
handbook and the competitor's member handbook. Even though the participants had all
used the competitor's member handbook, it was necessary to provide them with copies to
ensure a fair comparison. They were allowed to take both handbooks home for one week
to look them over.
Stage 2. The groups were brought together for a follow-up session that focused on
data collection. Each session was facilitated by an independent researcher unaffiliated
with the MCO, and each participant was provided lunch as a reward for participating in
the study.
The six focus groups all followed these steps: 1. Determine customer requirements. 2. Measure the importance of the customer requirements. 3. Rate customer satisfaction with the company's current member handbook. 4. Rate satisfaction with the competitor's member handbook. 5.
Develop a list of characteristics that are within the control of the company and
could potentially improve the handbook. These characteristics are referred to as substitute
quality characteristics.
The QFD process begins by capturing the voice of the customer or the customer
requirements. The key customer requirements identified were ease of use, accuracy,
timeliness, clarity, and consciousness. The technical requirements that describe how the
organization will respond to each of the customer requirements were identified as follows:
• Font size • Up-to-date information • Use of pictures or illustrations • Use of colors • Glossary of terms • Answers to frequently asked questions • Expanded table of contents • Offering the handbook in more than one language After gathering the customer and technical requirements, the MCO determined there was
a strong correlation between the substitute quality characteristic (technical requirement) of
ease of use and the customer requirements of expanding the glossary of terms and the table
of contents. Similarly, the following substitute quality characteristics had a moderate
correlation with ease of use:
• Font size • Use of pictures or illustrations • Use of colors • A question and answer section • More language friendly Providing updates had a weak correlation with ease of use.
The results of the MCO's QFD study resulted in the House of Quality shown in Figure
7.30. The numbers in the Rate of Importance column indicate the relative importance
customers assigned to each requirement. The importance rating uses a numerical scale from
1 to 5, with 1 being low and 5 being high. Members were asked to use such a rating scale
during the focus group sessions. Two customer requirements—ease of use and accuracy—
were assigned high importance ratings of 4.5 and 5, respectively. The other three customer
requirements—clarity, timeliness, and conciseness—received importance ratings of 3.8,
3.2, and 2.5, respectively.
(Evans 358-360)
Evans, James R. Managing for Quality and Performance Excellence, 10th Edition. Cengage
Learning, 20160101. VitalBook file.
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