Virtua's Miller said he first became interested in GE's consulting capabilities when Immelt visited during his time running GE's health care arm, before becoming CEO in 2001.

I called GE and asked, can you have a master black belt or a couple of your master black belts come out and talk with us? Miller said.

Their systematic approach to problem solving impressed Miller, who in 2001 sent a handful of staffers to GE's corporate training center in Crotonville, New York to be trained in Six Sigma.

Nearly a decade and more than 100 Six Sigma projects later, Virtua has made scores of small changes to the way it operates, from better staff scheduling to slashing by two-thirds the amount of time it takes to treat a woman who discovers a lump in her breast, which can be a warning sign for cancer.

The hospital has also shifted the responsibilities of some departments. It is now up to the staff of patient wards on the upper floors to keep track of when people are admitted to the hospital via the emergency room, for example. The upshot: patients spend less time waiting on emergency room gurneys.

Making the change required upgrading communications systems so that the nursing staff on the upper floors know what's going on downstairs. Virtua has phased in video monitors at nursing stations, which track how many patients are waiting in the ER for rooms -- the screens turn red when a backlog forms.

That's a big break from how many hospitals operate.

If you come into the (emergency room), housekeeping doesn't necessarily know that they need to get that bed ready, said Mark Vachon, who heads GE's hospital consulting arm.


But those changes are just a warm-up. The big payoff will come in a new, 680,000-square-foot (63,170 sq metre) hospital Virtua is building to replace its main 1970s-vintage site. In April, Virtua sold about $565 million in bonds to help fund construction of the new site.

Every element of the $460 million new facility -- from the separate entrances for juvenile and adult emergency patients to the height of shelves in the storage closets -- has been designed with efficiency in mind.

Hospital staff started planning for the new location in 2003, spending the first year analyzing basic functions like how they handle women in labor. Virtua estimates that it will be able to deliver another 2,000 babies per year -- a 35 percent increase -- in the new facility with just one more labor and delivery room, thanks to changes in work flow.

The hospital has gone so far as to build out full-scale, fully furnished mock-up patient rooms in a warehouse near its current facility to give staff and former patients a chance to weigh in on the new design.

During a recent tour of the still-under construction facility, which is scheduled to open in 2011, Virtua officials stressed that all these small tweaks could have big effects. There are separate entrances and corridors for outpatients -- basically healthy people in for a quick procedure -- and inpatients -- who tend to be sicker. Hospital officials said this should reduce the risk of those two populations sharing germs.

Similarly, patient floors will feature small storage closets spaced between every six to eight beds, versus the one large closet per 40 beds used at Virtua's current facility. That should greatly reduce the amount of time nurses spend walking around looking for bandages and syringes.

Still, the new hospital was not designed entirely with an eye toward cutting costs. For instance, the maternity level is made up entirely of private rooms, instead of the shared rooms common at its current hospital.

That shift -- as well as offering things like room service and Internet access -- adds costs. But the hospital has little choice if it hopes to meet the demands of finicky American patients, said Ninfa Saunders, executive vice president for health services at Virtua.

Who would have ever thought, 10 years, 20 years ago, that we would do room service in a hospital? Saunders said. Do we need all these private rooms? No. But if we want our patient satisfaction to be the best there is, we better have that.

Those sorts of compromises between efficiency and comfort illustrate the tricky balancing act hospital administrators face --between controlling costs and attracting patients and doctors.

They also suggest that cost-cutting alone at hospitals is unlikely to provide enough savings to solve the problems that plague the U.S. health system.

That's insufficient to create the significant change in the cost structure that we hear the government talk about, said Deloitte's Robertson. It requires a different model and that's not within the control of the individual hospital.

But it has been significant for Virtua and other hospitals whose patients are better served by a more businesslike approach to healthcare.

(Reporting by Scott Malone, editing by Jim Impoco and Claudia Parsons)