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Healthcare Project Management 101: Experts Share Techniques, Examples and Future Outlook

by Becky Simon on Feb 06, 2020

This article provides a wide range of details about healthcare project management (PM), along with tips from experts on how to perform it well. You’ll also find details on project management techniques, including Agile and waterfall, and information on a career as a healthcare project manager.

Included on this page, you'll find details on what healthcare project management is, Agile project management in healthcare, why project management is important in healthcare, and information on what it takes to be a healthcare project manager.


What Is Project Management?

Project management is a process of planning, organizing, and overseeing the work of a team to advance a specific organizational project and achieve an organization’s objectives. Project management does not involve the routine day-to-day operations of an organization. 

Instead of focusing on everyday duties, PM zeroes in on work with a defined end point and a specific goal. Project management occurs in a wide range of industries and organizations, including healthcare organizations. You can learn more about project management with this project management guide.


What Is Healthcare Project Management?

Healthcare PM concerns any projects that seek to improve the functioning of a healthcare-related organization. As the industry continues to evolve, there are increasing pressures to save money and be efficient while improving the quality of patient care.

All of that means that hospitals, healthcare systems, and others in the industry are continuously executing projects to improve their operations.

Teresa Knudson

“Now more than ever, healthcare really needs to adopt [good project management principles] because of all the internal and external challenges,” says Teresa Knudson, Director of the Enterprise Portfolio Management Office at the Mayo Clinic and a board member of the nonprofit Project Management Institute (PMI). “You have to know what you’re doing and be better at it.”


Waterfall Project Management in Healthcare

The waterfall methodology is one of the most common methodologies in project management. It organizes the project in a sequential and linear process (flowing like a waterfall) and has a number of phases. A new phase can’t begin until the prior phase has been completed.

The waterfall methodology has often been used in manufacturing and construction. And, healthcare construction projects are often managed through the waterfall project management methodology. For example, a hospital needing to build a new cardiac catheterization laboratory suite will have defined requirements and a timeline commencing at the onset of the project. The hospital may also have built similar projects before. The project lends itself to the waterfall method because there are defined phases that need to be accomplished linearly.

 

Greg Githens, an executive and leadership coach and the author of How to Think Strategically, also points out that some healthcare projects that may require eventual Food and Drug  Administration (FDA) approval — the creation or development of a medical device, for example — may significantly benefit from the waterfall methodology. That’s because the FDA, along with other government agencies, require quality checks and design checks at various stages of development that are easier to document in waterfall, he says.

“You have to have testing along the way and a lot of documentation to support your testing,” he says. “Waterfall basically means that you move in phases and that you don’t exit a phase until you can check off all the boxes that indicate that you’ve finished all the required work.”

You can learn much more about the waterfall methodology from this guide on the waterfall methodology.


Agile Project Management in Healthcare

Agile project management began in software development. It employs a much more incremental and continually evolving approach than waterfall. It uses a cyclical process that encourages flexibility, experimentation, and adaptability.

The Agile methodology can work better than waterfall for many healthcare projects because healthcare work and processes can have numerous and constantly changing variables. Agile can help healthcare project management teams easily adjust to those changes.

“The iterations [of a process change] in Agile are shorter,” says Githens. “One of the advantages is that you’re able to recognize a mistake earlier and then correct that mistake.”

You can learn more about Agile from this guide on the Agile methodology.


A Hybrid Approach — A Combination of Waterfall and Agile

Healthcare project management teams sometimes use a hybrid approach, employing a combination of waterfall and Agile to manage a project.

In these circumstances, teams may primarily use the Agile methodology, while at the same time incorporate some aspects of waterfall to provide a timeline and a project roadmap to team members and to an organization’s leaders.


Why Is Project Management Important in Healthcare?

Project management has become even more important in healthcare in recent years. In large part, that’s because of safety concerns: a healthcare project done ineffectively can lead to patients’ health problems.

But, a range of other issues are affecting the evolving industry — issues for which project management is increasingly vital. These issues include the following:

  • Decreasing payments from government health programs and private insurance companies have compelled healthcare organizations to find ways to save money.
  • New and complicated systems for electronic health records on patients need continual monitoring and improvement.
  • New technologies also need tracking and improvement.
  • New regulations continue to emerge.
  • There is greater scrutiny from outside groups, including government, health insurance companies, and patients.

The Huge Costs of Healthcare, the Size of the Industry, and Issues with Safety

A range of statistics indicate the enormous size of the healthcare industry and its effect on the overall economy and the life of Americans. These stats also underline the amount of work that healthcare organizations require for project management to continually improve operations in such a huge industry:

  • Americans spent $3.5 trillion dollars on healthcare in 2017, or $10,739 per person. That compares to $3 trillion in 2014 and $2.6 trillion in 2010. For comparison, Americans spent $247 billion on healthcare in 1980.
  • After the passage of the Affordable Care Act in 2010, the rate of people without health insurance had dipped to 9.2 percent by 2015.
  • Nearly five million doctors and nurses work in the U.S.
  • Experts predict that the industry will add another 3.4 million healthcare jobs by 2028.
  • Eighteen of the 30 fastest growing occupations in 2018 were in healthcare.

Meanwhile, the healthcare industry has significant problems with safety and with deaths from medical errors:

  • A 2018 Johns Hopkins study estimated that more than 251,000 people in the U.S. die annually from medical errors.
  • A 2012 report by the National Institutes of Health estimated that 440,000 deaths in the U.S. per year were from medical errors.
  • Some studies have estimated that medical errors affect as many as one in three patients.

Benefits of Healthcare Project Management

Strong project management helps improve healthcare and the healthcare industry in a number of ways. Project management can do the following:

  • Improve the quality of care by improving processes used to provide that care.
  • Improve communication among healthcare staff caring for patients.
  • improve organizational planning.
  • Improve budgeting, as strong project management directly aligns resources with important work.
  • Increase staff productivity.
  • Improve processes that are established to decrease the risk of lawsuits — in large part because improved processes increase the quality of care.
  • Improve relations with stakeholders, including insurance providers, government agencies, patients, and others.

Challenges of Healthcare Project Management

The healthcare industry can present special challenges to good project management. Here are some of those challenges:

  • There are high stakes. Poorly executed projects can bring more serious ramifications, because patients’ health can be at stake. “Patients’ lives are a part of this,” says Githens. “A poorly done project might end up with poor healthcare outcomes.”
  • There are continually rising costs in the industry.
  • There is heavy governmental regulation.
  • Healthcare is a continually evolving industry.
  • There is a high risk of lawsuits.
  • There is a broad array of involved stakeholders, including hospital boards, medical providers, state and national governments, and patients.
  • There is skepticism among some important stakeholders about the importance of project management. Medical providers who are highly accomplished professionals in a particular medical speciality “sometimes see project management as a non-value-added administrative function,” Githens says.

Why Healthcare Project Management Fails

Managing projects in a wide range of industries can be complex, and those projects sometimes fail. But, healthcare project management can be even more complex and may fail even more often. 

In fact, according to the book, Project Management for Healthcare Informatics, one study estimated that as many as 80 percent of healthcare projects fail

These failures happen for a range of reasons. Here are some of the most common ones:

  • Lack of Prioritization: Any organization could embark on hundreds of “projects” at any time. But, embarking on too many projects means an organization is not doing any of them well. Overcommitting is not an efficient use of resources, and it’s not effective.

    “Most organizations have way too many projects, and the projects are therefore under-resourced. [The organizations] are doing a ‘squeaky wheel gets the grease’ prioritization process. They’re trying to do too much and not setting priorities for the organization.”
  • Inadequate Planning: Once organization leaders prioritize which projects are important, project leaders and team members must do important planning work at the beginning of a project to ensure its success. The team needs to consider and set out the tasks that it needs to accomplish, in phases, along with a timeline, an assessment of costs, and potential risks and challenges for the project.

    “Planning is the most important step in the project lifecycle,” the authors write in Project Management for Healthcare Informatics. “The majority of project management gurus feel that if problems arise during the life of a project, the cause can usually be traced back to the lack of planning.”
     
    Greg Kain

    Lack of planning is “the number one reason [projects] fail,” says Greg Kain, Managing Director of the Healthcare Practice for Integrated Project Management Company, Inc., a consultancy headquartered outside Chicago. “You have to plan to execute.”

    Part of planning is creating and following a project charter that details the project’s goals and metrics for success, Kain says. 
  • Poor Definition of Project Requirements: Making mistakes, such as misunderstanding and inaccurately defining project requirements and goals, is an integral part of planning. However, these mistakes during planning can create major problems beyond the planning stage. When team members don’t ask the right questions about the goals of a project, they don’t realize that reaching the stated goal won’t really improve the organization.“

    The number one reason for project failure is poor requirements or incomplete and incorrect requirements,” says Githens. A lack of serious analysis means the group “puts a solution in place that’s not the right solution,” he adds.

According to that study (above) cited in Project Management for Healthcare Informatics, here are some additional reasons for project failure in the healthcare industry:

  • The growing complexity of data collection requirements in healthcare organizations
  • Increased regulation
  • Poor communication among a healthcare organization’s leaders, stakeholders, and patients
  • Organizational resistance to change

Examples of Healthcare Project Management

Project management is used in thousands of cases in the healthcare industry. Projects may seek to improve patient care, improve efficiencies or save money, or improve other parts of an organization’s operations. Below are some examples of healthcare project management.

Improving Patient Care and the Patient Experience

Here are some examples of healthcare project management concerning the improvement of patient care and the patient experience.

  • Improving the Patient Experience from Hospital Admission to Discharge: Hospitals are increasingly analyzing the patient experience from the moment a patient arrives at a facility (either as an in-patient or outpatient) to the moment they leave, Githens says.
  • Developing a Template for Approval to Use an Air Medical Helicopter to Land at a Medical Facility: “Project Management for Healthcare,” a white paper written by David Shirley, a project management consultant and college professor, cites a case where an air ambulance service was approving the landing of its helicopters at specific facilities on a case-by-case basis. “Because the requirements were standard — distance from the buildings, size of the landing area, approach procedures, etc. — it was logical to undertake a project to build a template that only needed to be tweaked for a medical facility’s request,” Shirley wrote. “Developing the template reduced the approval times, thus potentially saving lives.”
  • Increasing the Size/Number of “Safe Rooms” in a Psychiatric Facility: A facility determined that it didn’t have adequate areas to care for and monitor agitated psychiatric patients and keep them from self-harm. A project helped design, plan, and build a safe room.
  • Designing an Improved Hospital Gown: A project helped design a hospital gown that was easy and comfortable for patients to wear and that met the needs of doctors who were examining patients.

Improving Operations

Here are some examples of healthcare project management concerning the improvement of operations.

  • Improving Administrative Efficiencies: This includes insurance processing.
  • Improving Efficiency of Temporary Health Worker Payment: A healthcare organization found that most of its invoices from temporary workers were incorrect in some way and routinely needed revision. A project helped design a standard invoice and invoice process that reduced errors.
  • Improving Efficiency of Operating Room Use and Improving Consistency in Operating Room Start Times: A hospital found that it had delayed start times for daily operating room use, often 30 minutes or more after the scheduled start time of 8 a.m. The hospital instituted a project that set up processes to address the various reasons for the delays — including how the organization prepared patients, staffed operating rooms, and kept surgeons apprised of surgery schedules.
  • Maintaining a Hospital Facility: A project addressed how a hospital informed its maintenance department of mechanical breakdowns and how that department responded to those breakdowns.

Other Projects

Here are some other examples of healthcare project management.

  • Electronic Health Records: Hospitals are routinely embarking on projects to adjust and improve the information technology systems that store and allow access to patients’ electronic health records.
  • Sharp Injuries to Hospital Staff — such as Skin Pricks from a Dirty Needle: These incidents are a major issue for hospitals. Such occurrences can and do expose hospital staff to dangerous viruses, including the human immunodeficiency virus and the hepatitis B and C viruses. One hospital embarked on a project to reduce sharp injuries in the hospital’s operating rooms.

Areas in Healthcare Ripe for Good Project Management

Project management is used in a wide range of areas within healthcare organizations. But, there are particular areas where it’s especially helpful. They include the following:

  • Information Technology: This includes managing all data and patient records and is beginning to include artificial intelligence systems.
  • Facilities: This relates especially to construction, renovations, and facility upgrades.
  • Process Improvement Projects: These are often focused on specific processes or procedures in order to cut costs or reduce errors when providing care to patients.

Healthcare Tasks That Project Management Can Help Guide More Efficiently

Project management can help improve processes across broad categories of work in healthcare organizations. Well-executed projects can help improve some of those day-to-day processes. Areas where they can help include the following:

  • Managing Tasks: The work of many health care specialists is dependent on the work of others. Some tasks must be completed before other tasks can begin. Project management can help improve systems and processes to ensure that they are operating as efficiently and effectively as possible.
  • Managing Staff Time: Having the appropriate health care staff available at the right time is essential for providing quality care. Project management can help ensure appropriate scheduling and time management for all staff members.
  • Managing Resources: Project management can ensure that your healthcare organization is effectively and efficiently allocating the resources it needs to do its job.
  • Managing Change: Employees in many industries — including the healthcare industry — resist change. Project management can help communicate and implement change in a way that leads to less resistance from staff.

Tips For Effective Healthcare Project Management

Experts offer a range of tips that can help your organization execute good project management. Top tips include the following:

  • Communicate openly with the entire organization about projects and goals.
  • Set up an appropriate governing structure to oversee the project. That means a structured system of rules and processes that help move the project forward.

    “The governance model is critical,” says the Mayo Clinic’s Knudson. That should include determining who to assign to important roles in the project. “Who’s the champion? Who’s going to be there day in and day out like a parent — there to solve issues?”
  • Prioritize. Decide which projects are vital and which shouldn’t be projects at all.

    “Resources are limited, whether human or financial,” write the authors of Project Management for Healthcare Informatics. “And, some organizations are unable to accomplish all the projects they want in a given time frame. The information an organization gathers during [a project’s initiation] phase … helps senior leadership make an educated decision on which projects should continue.”
  • Set up the right team. Ensure that your team includes employees from across the organization who understand the process that the project is trying to improve.

    “You want to make sure that you have the right team members,” says Knudson. “And often, that means bringing together people who’ve never worked together. [Leaders need to] get everybody working together toward that same common goal. They need to assign the right responsibilities to the right team members.”

    “I really focus on having that high-performing team,” Knudson says. “And, we all respect one another’s roles.”
  • Create and follow the project charter and scope document. Integrated Project Management Company’s Kain says that when his group is pulled in because a healthcare organization’s project is in distress, “It’s almost always the case that there isn’t a good charter.” Without a good charter, “you lose alignment regarding why you’re doing the project to begin with,” Kain says.
  • Ask the right questions about project requirements and goals. Githens says that at the beginning of a project, the project team members need to ask probing questions about the project’s requirements, such as “What is it trying to accomplish?” and “What does success look like?”

    “The number one reason for project failures is poor requirements,” Githens says. “Once you realize that, you know you have to be more proactive and ask better questions” at the project’s onset. In order to avoid project failures, make sure to do the following:
  • Streamline the process as much as possible.
  • Expect the unexpected and be willing and able to adapt.
  • Document your results.
  • Understand healthcare regulations and governance and how they impact the process and your project.
  • Create a project management office. Organizations are increasingly creating internal departments, or enlisting an external group, to define and maintain the organization’s project management standards.

Healthcare Project Manager Job Description

A healthcare project manager is responsible for leading and overseeing projects that a healthcare organization is pursuing to improve operations or patient safety. The manager coordinates and directs all project team members working on the project.

What It Takes to Be a Healthcare Project Manager

Being a good healthcare project manager takes some specific skills, including the ability to approach and react to problems.

Here are some basic skills required of project managers:

  • Interpersonal skills to help you work with and inspire a range of organizational employees 
  • Leadership skills
  • Problem-solving skills
  • The ability to be flexible and adjust to changing circumstances

You also need to develop a nuanced understanding of the following:

  • Working in an unusual market, where insurance coverage and other variables make the buyer and seller relationships different than in many markets
  • How a range of healthcare stakeholders will want to be involved in many projects
  • The increased regulation of the healthcare industry

Education that you will or may need includes the following:

  • Undergraduate degree related to health administration, public health administration, nursing, economics, or business administration
  • Advanced degree in similar fields

Knudson, from the Mayo Clinic and the Project Management Institute, says she believes that there are some overall attributes that strong healthcare project managers should have.

“You’ve got to love change,” she says. “You’ve got to love challenges. We’re impacting patients’ lives. We’re helping patients. Healthcare PMs are ultimately serving the patient. I think you need people who are really motivated by that idea.”

She says she likes healthcare project managers “who jump in and figure out how to solve things. People who will jump with me into the deep end of a pool without knowing how deep it is.”


Healthcare Project Management Training

Beyond their undergraduate or graduate degrees, many project managers take part in ongoing training to improve their skills and gain certain certifications in project management.

The Project Management Institute, a nonprofit professional organization of project managers around the world, awards specific certifications in project management. PMI certifications include the following:

  • Project Management Professional (PMP)
  • Program Management Professional (PgMP)
  • Certified Associate in Project Management (CAPM)

Some healthcare project managers also have certifications in various healthcare disciplines and specialties.


How Much Do Healthcare Project Managers Make?

Some groups have estimated that the average annual salary of a healthcare project manager runs from about $79,000 to $91,000. A 2017 biennial survey conducted in part by the Project Management Institute found that the average salary of healthcare project managers was higher than that — about $112,000. About 33,000 respondents in 37 countries participated in the PMI survey.


The Job Outlook for Healthcare Project Managers

The job outlook for healthcare project managers is very good.

In a 2017 report, the Project Management Institute estimated that an average of 2.2 million new project management roles would need to be filled by employers each year from 2017 through 2027. That growth will be fueled in part by a high number of current employees retiring. While the report covered project managers in all industries, it also indicated that project management needs in healthcare were expected to grow especially fast.

Meanwhile, the U.S. Bureau of Labor Statistics has estimated that employment of medical and health services managers — of which project managers is a part — is expected to increase 18 percent from 2018 to 2028. That’s much faster than the average for all occupations.


Project Management in Public Health

Project management is increasingly used in public health initiatives. These initiatives often need to provide information to the general public and find ways to interact with the general public.

The type of public health work where project management might be relevant includes the following:

  • Vaccination and immunization programs
  • Outreach about telemedicine programs available through healthcare organizations
  • The establishment or adjustment of policies for governmental health programs
  • The creation or adjustment of programs to prevent communicable diseases

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