Below is my lastest post in HealthSystemCIO.com.

http://healthsystemcio.com/2010/12/01/relative-non-value-units/

This issue has been troubling me ever since a doctor told me her hospital was implementing it.  It is good to know that there are no patents on bad business ideas—that way everybody gets a chance to use them.  Sometimes bad ideas come with misnomer labels that suggest they are less evil—Meaningful Use is a good example of a misnomer idea, but that is not the topic of today’s discussion.

Permit me to illustrate this idea with an identical policy in another industry, one that I believe will hit home for many.  Think back to the last time a cable television technician came to your home to perform some piece of work; moving or adding an outlet, installing cable or internet.  (Before I started practicing medicine on-line, I spent many years consulting to the cable industry about how to improve their operations using the tools of IT.  I often rode with the technicians to observe how they did their work.)

During these times I noticed jobs when the technician did not have the time needed to complete the work described on the work order.  Rarely did the technician have time to complete any add-on work—work requested by the customer while the tech was at their home.

What really interested me was the answer to my question of ‘why’?  It comes down to the following.  When the technician leaves the service bay in the morning, the tech has a list of work orders that must be completed by the end of the day.  Each work order is worth a fixed number of points, and the technician is evaluated and paid in relation to the number of points earned.

Let’s say the tech is to install a new wall outlet; five points and 30 minutes may be assigned to that work order.  The tech arrives at the home only to learn the outlet is to be installed on an interior wall and the cable will have to by threaded through the wall via the attic; a sixty minute job.  If the tech stays to complete the work, it will only yield five points and delay his entire schedule by thirty minutes.

Either way, the process fails, and the customer is failed.  The tech will return tomorrow at double the cost to the company, but he will now be allocated 60 minutes for the work.  There is always time to do the work over, and never time to do it right.

This business process suggests the next customer is always valued more highly than the present customer.  This is why when you are being helped by a clerk in a store and the phone rings the clerk will stop servicing you—a paying customer—to service someone who merely wants to chat.

The process? Relative Value Units (RVUs), and it’s another misnomer.  An argument can be made to show RVUs have little or no relative value, but entire hospitals run on these, and IT builds systems to assign, track, and report on RVUs.  Is there a way for IT to demonstrate or report the impracticality of running a business in this manner?