Do we dismantle the hospitals?

The Globe and Mail. (2014). Why the future of health care may depend on tearing down the hospital. [online] Retrieved from: http://www.theglobeandmail.com/life/health-and-fitness/health/the-hospital/the-future-of-health-care-may-depend-on-tearing-down-the-hospital/article17030106/?cmpid=rss1 [Accessed: 24 Feb 2014].

The article is about tearing down the hospital in favour of a network of community health-care centers.  It gives an example of a patients with comorbidities who had been in and out of the hospitals several times.  The argument being given is that the current system hasn’t helped the patient in long-term remission and the whole ordeal has been costly for the system.  The article further states that the current health care system is acute care centric and offers no additional benefits to such patients.

I would agree with the latter part, but we do need to have an alternative in place before we start tearing down these hospital.  What would have happened had there not been that tertiary care hospital?  Is our community based infrastructure ready for such patients? 

Further, the article talks about how such patients get caught up in vicious cycle of deterioration at home, only to return to the hospitals.  I would argue that this is what the hospitals are meant for.  Treatment in the community is best left for such diseases which can typically treated in ambulatory settings.  Patients with such comorbidities cannot be treated successfully in community hospitals, let alone in community health care centres. 

The article again brings to foreground that various innovative physicians have a solution, which is getting rid of the hospital to begin with.  They argue that their community based model will provide services such as physiotherapy, social workers etc.I would argue that before we think of that, we must have an alternative ready and successful.  There is no guarantee that such drastic measures will bear favourable results.  The unfortunate part is that the proponents of community based model are targeting the kind of patients that need the hospital setup the most. 

There is an argument put forward that channelling money towards home and community care without dismantling the hospitals would be counterproductive.  As this is something that will only increase the costs.  I would consider such a suggestion quite preposterous.  How can one do away with hospitals without any kind of alternative in place.  As all would agree, the transition away from the hospital has to be gradual and calculated.  The proponents, however, believe that there are many services, like tests, that cannot be administered from home, thereby contradicting themselves.  I would suggest that efforts should be made to use telemedicine more effectively in conjunction with home and community care, before efforts are made do reduce burden on the hospitals.  The articles does agree, however, that just spending money on home care won’t deliver desired results unless it is coupled with services to fully integrate the system.

The article gives an example of how the paramedics had take an intoxicated patient to the hospital, and by the time he could be admitted, he had already recovered and walked off the emergency.  I would recommend that the proponents of the community model should rather me concentrating on such patients.  We need to explore why paramedics couldn’t have taken such a patients a community based organization in the first place. 

The articles gives an example of a clinic in a homeless shelter, which welcomes patients brought by police and paramedics.  It goes back to the previous example, and elaborates how their small venture has expanded to more beds for homeless, and provide services of nurses; personal-support workers; additions; counsellors; and social workers.  I believe this would be a great starting point of integration and shouldering responsibility, rather than big ticket comorbidity ones. 

The article highlights another set of opinion that presence of a hospital based system prevents any innovation from taking place in the community.  I would argue that it is not hospitals’ fault, but lack of culture of innovation in the system.  Also, the impression in the public is that hospitals are meant for emergencies or serious conditions.  I really wonder how many really go to hospital out of choice?  I believe here lies the opportunity for making the Community Health Centres (CHC) more visible.  There should be an effort on their part to reach out to the public.  After all, do people even know what all services are available at their nearest CHC? 

Further, it elaborates on a particular shining example of innovation in community based settings at a Family Health Team (FHT).  I believe that here lies an opportunity for creating a governance structure to share such ideas.  I am not sure, but I would take the liberty of recommending this to the Association of Family Health Team of Ontario (AFHTO) to take up a leadership role in this regard.  At the time, involved LHINs so that they are aware of the ground situation, and gauge and plan any move from hospital to community sector.     

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Employee health incentive: Employee wellness program prod workers to adopt healthy lifestyles

According to this article (Hsph.harvard.edu, 2013), employers are considering various options to encourage their staff towards primary care.  Without going into the details of the options, we will try to understand the thought process behind these innovative approaches. 

On of the obvious ways of encouraging the employees to change their behaviour is the “carrot and stick” policy.  They can start off with concentrating on the most widespread and critical contributing factors, such as smoking and obesity.  For those who are already on the wrong side of these parameters, the penalties should be less strict and the wellness programs should have more reasonable targets. 

Employers broadly use three ways of encouraging healthy behaviours.  Firstly, there are certain companies like IBM that provides incentives to those will to work towards healthy lifestyles.  Then there are certain organizations like State of Alabama that mostly provide incentives, but also impose penalties under certain conditions.  Lastly, there are likes of Scotts Miracle-Gro who are most proactive, and use a balance of incentives and disincentives.  They provide membership of fitness centre, healthy living coaching and free prescriptions of generic drugs.  At the same time, employees who don’t participate in their voluntary health-risk appraisal have to pay higher premium.  Those found to be of mid- to high-risk can take advantage of wellness measures.  And those who don’t follow up on measures, pay even higher premium.  

Researcher concur that there is insufficient evidence to show if incentives or heath risk assessment actually work.  But there is general opinion that penalties will.  In summary, the “carrot and stick” policy would be the best way to go.


Hsph.harvard.edu. (2013). Harvard school of public health » hsph news » employer health incentives: employee wellness programs prod workers to adopt healthy lifestyles. [online] Retrieved from: http://www.hsph.harvard.edu/news/magazine/winter09healthincentives/ [Accessed: 31 Dec 2013]

Basis for Developing System-wide Clinical Pathways

Kinsman, L., Rotter, T., James, E., Snow, P. & Willis, J. (2010). What is a clinical pathway? Development of a definition to inform the debate. BMC medicine, 8 (1), 31.

The article talks about Clinical Pathways, which are tools that guide evidence-based healthcare.  But, there is a widespread disagreement about their impact on hospital resources and patient outcomes.  This stems from confusion among researchers and healthcare personnel regarding what makes up a clinical pathway.  In an effort in that direction, a team of Cochrane review authors decided to create a criteria to assist in the objective identification of clinical pathways studies from the literature.

In an effort to device a criteria to define a clinical pathway, the undertook a four-stage process:  do literature review to define clinical pathway; develop a draft criteria; pilot test the criteria; and modify the criteria based on over all literature review.

Literature review and their liaison with the European Pathways Association resulted in creation of five criteria used to define a clinical pathway: (1) intervention should be structured multidisciplinary plan of care; (2) it should translate guidelines or evidence into local structures; (3) it should detail the steps in the course of treatment or care or criteria based progression; (4) it should have timeframes or criteria-based progression; and (5) it should aim to standardize care for a specific clinical problem or episode of healthcare in a specific population. 

After pilot testing it was concurred that if an intervention met the first criteria, and in addition three out of the other four, then it should be considered as a clinical pathway.  Therefore, this criteria can be used as a basis of development of standardized, internationally accepted definition of a clinical pathway, and for the pathways themselves. 

The method employed is simple and credible.  It stress on the fact that there is widespread disagreement over their impact on hospital resources and patient outcomes.  I believe the disagreement comes for conflicting priorities on the management and the physicians.  However, it is not difficult to resolves as such conflicts happen across the spectrum of healthcare delivery.  Further, I believe that care pathways should have flexibility built in to allow customization based on patient’s needs and that of the providers.  So long as the patient reach the right destination within the broad parameters of pathways it is fine.  Keeping this way we will be able to balance both outcome and resources.

Also, there is need to have multi-disciplinary teams to discuss clinical pathways, so that everybody’s perspective is taken into account, and appropriate clinical pathways are developed.  These teams “should” have representation from every possible sector and profession that may be required to participate in the delivery of care.

Review : Putting the Balanced Scorecard to Work

Kaplan, R. and Norton, D. 1993. Putting the balanced scorecard to work. The performance measurement, management and appraisal sourcebook, pp. 66–79.

The article states that today’s managers realize the impact measures have on performance. But what they don’t realize is that measurement is essential part of the strategy. They may introduce new strategies and innovative operating procedures, but continue to use the same short-term financial indicators. They not only fail to realize the new indictors, but also fail to question whether the old measures are relevant.

The balance scorecard provides with a comprehensive framework that translates company strategic objectives into a set of performance measures. It presents with four different perspectives from which to choose measures: financial, performance for customers, internal processes, and innovative and improvement activities.

Traditionally, companies have their own operational and physical measures for local activities. But these local measures are bottom up and are based on ad hoc processes. On the other hand, the scorecard’s measures are based on organization’s strategic vision and competitive demands. Scorecard, by requiring the organization to concentrate on limited number of indicators, helps them to concentrate on their strategic vision.

Unlike traditional measures, which focus on past successes, the balanced scorecard tries to strike a balance between current and future successes. Also, it tries to strike a balance between external measures, such as operating income and internal measure, such as new product development.

Finally, organizations are typically involved in various initiatives such as: process reengineering, total quality, and employee empowerment, but lack a sense of integration. The process of balanced scorecard development tries to create a focal point of activity where all such activities are integrated.

The balanced scorecard is not a template that can be applied everywhere. Its development is a process that can be applied to different situations, strategies and environment. In addition to organization, their individual units can customize it according to their objectives. Balanced scorecard is very transparent, as by looking at it, one can arrive at a conclusion about business unit’s competitive strategy.

Let’s take example of Rockwater, which is an underwater engineering and construction company. They realized that the competition in their industry has changed dramatically. They observed that the focus in the industry had shifted from low-price competition to long-term partnership based on value creation for the clients. The senior management team of the company created a vision for their company. It was to provide highest standard of safety and quality for their clients. Based on that vision, they also created a strategy, which had five elements, which were further developed into strategic objectives. To make them tangible, they distributed those strategic objectives among the four sets of balanced scorecard performance measures.

If one observes their financial measures, in addition to the measures for short-term results, they added two more measures to overcome the uncertainty of future performance. Regarding the Customer Satisfaction measures, and in response to changing environment, they decided to divide them into those who provide high value and those who are price conscious. This will allow them to create a different set of measures for both kinds of clients. As value-based clients were beginning to bring in more business, and were focus of their strategies, they decided to conduct an annual survey to understand their perceptions of the company. This was in addition to monthly satisfaction and performance ratings they requested from their clients. They felt that such measures gave them direct access to customer and market feedback.

Regarding internal processes at Rockwater, they made a major shift in their thinking. They moved from measuring performance of each functional unit to that of integrated key business processes. This helped individual business units to come out of their silos, and think about product and end-to-end process to deliver them. This helped make the effectiveness of their project performance as their key core competence. Further, the also realized that time spent with prospective client went a long way in building relationship. And it had direct bearing on influencing results. At the same time they wanted that a metric that could be communicated this across the organization. Even though it is an input or process measure, they chose to go ahead with “hours spent with key prospects discussing new work” as a key measure.

With regards to Innovation and Improvement, Rockwater believe that it was something that driving the other three categories. They believed that they would achieve these objectives through innovation of new products and services. This will result in creation of new sources of revenue, and market expansion and diversification. They also stressed on the need for continuous improvement of internal processes. They measured the first objective by the revenue generated from new sources. And the second objective was measured by a continuous improvement index. They felt the need to create an appropriate atmosphere in order to drive these two objectives. A supportive climate of empowered and motivated employees was considered essential.

The picture changes slightly when evaluating the role of balanced scorecard in context of Apple computers. When they went about creating theirs, they wanted to think beyond the short-term measures, such as ROE and market share. For financial perspective they chose shareholder value; for customer perspective, they chose market share and customer satisfaction; for internal process perspective, they chose core competencies; and lastly for improvement and innovation, they stressed on employee attitude.

As their customer base was not homogeneous, they chose to do their own customized survey than to depend on standard market surveys. It is highly noteworthy the core competencies they chose under internal process perspective. What they chose to make their core competencies is the kind of things that are close to their client base. That made a wonderful strategy, and it clearly reflects on their products. To promote the employee commitment and their alignment, they chose to do survey. And in an effort in that direction, they formulated the survey question to convey and assess their knowledge about company strategy. Also, the used the market share as tool to remain attractive to software developers. The inclusion of shareholder value is well thought off, even though it is a result and not a driver of performance. This was done with the idea of replacing the old indicators that didn’t take into account the investment made today, which will generate revenue in future. This helps the unit head of each major organizational unit to assess the impact of their initiatives on company’s new ventures.

These initiatives have helped Apple in many ways: as the balanced scorecard is used primarily as a planning device, instead of monitoring device; and these metrics can be driven both vertically and horizontally.

The move to balanced scorecard at AMD (Advanced Micro Devices) depicts a very contrasting picture. They did execute a quick and smooth transition to balanced scorecard. They already had a clearly defined mission and strategy, and senior management team understood it well. They already had performance measures, which fitted well into a quarterly briefing book’s seven sections. So, the things pretty much remained the same. As a result what they had a repository of information that allowed long-term analysis for performance and planning evaluation. All this looks fine, but it had retrospective outlook, and didn’t seem to lead the change.

It cannot be overemphasised that the development of balanced scorecard helps drive change. Particularly, if two different organizations are merging, it helps bring together the culture and help employee speak same language. The process of developing the balance scorecard comes in handy, when despite apparent consensus on strategy; there is disagreement about how to make it operational. Therefore, it helps them reach a consensus regarding the high priority areas.

Taking example of Analog Devices, it states that the main impact has been to help sustain initiatives where they have been working for years. In contrast, the scorecard isn’t always an instrument for dramatic change. Taking the example of AMD, the development of scorecard didn’t have any dramatic impact because the executives didn’t use it to drive the change. Prior to developing the scorecard, they had already formulated and reached consensus over mission, strategy and key performance indicators. As AMD competes in a narrow segment of the industry, the managers were already familiar with the technology, engineering and the markets. So, what they compiled at the scorecard wasn’t new, but it did allow them to see things from organizational perspective. Therefore, AMDs limited success with the scorecard underscores the point that it delivers dramatic results only when used to drive a change process. That makes it not just a measurement system, but a management system.

Not just the scorecard, but also the kind of measures we are employing is also important. Taking the example of FMC Corporation, as diversified company, the return-on-capital-employed (ROCE) was especially important for them. The move away from return-on-investment to ROCE helped them focus their attention on further growth. From that perspective, it helped them determine business that were doing well, and those that weren’t. It also set them for splitting the company into independent companies, such that each had its own strategy. The take away is that if you want a corporate to change its strategy, then you must change the system of measuring the new strategy.

Balanced scorecard also helped organization step away from measuring only the short-term financial results. The organizations realized that they need a new system of measurement to help manager achieve breakthrough in marketplace. They would need to focus on thing that will bring in long-term values, such as customer service, market position and new product development. They use the balanced scorecard a focus of their discussion about they want to see in future, how to become the most valued supplier etc.

It also entailed giving freedom to division managers to develop their own balanced scorecard. But senior management did give them certain specific guidelines: first, the measures should be objective and quantifiable, and second, they should be output measures, and not process measure. It is believed that focusing on output measures helps managers to understand their industry and strategy, and helps to measure success through specific output.

While building upon the balanced scorecard, one needs to understand that difference between process improvements and the output achieved. Furthermore, one needs to differentiate between benchmarking and scorecard. It is much easier to benchmark a process than an output. That is because each of the output measures are associated with long-term targets. That is what makes a scorecard more strategic.

The managers at FMC didn’t find going for unit wise scorecard as smooth as predicted.

Leadership Skills for Healthcare Reforms

Was reading Tom Dolan’s article in Healthcare Executive Sept/Oct 2010 edition, about changes PPACA and the changes it will bring.  He talks about five broad points.  Even without the new legislation, these points do hold ground.

                        1. Mastery of change management and change leadership:  No matter how big a change, there are are few things that healthcare executives will always need.  They are change change management and change leadership.  Change management is the technical component of strategy and to be able to oversee their implementation.  This would include how the methodology is being applied to various initiatives, and whether staff are trained in it.  Change leadership is the human component of it, which is the belief in change management.  It includes realization and communication of negative fallout of not being able to change.  I believe this culture of reacting to change should exist well before any changes comes our way.  Else, it is just too much work in too little time.  If we are not used to coping with small changes, how would we to a big one.
                        2. Continued quality and patient safety efforts:  As we know quality and patient safety is raison d’etre of hospitals.  It is imperative that boards and senior management should be behind any effort in this direction.  If they’re not by choice, then they’ll have to be by compulsion.  It is important that executives are familiar with the tools.  What is more important is that they create an atmosphere where staff are motivated enough to find shortcomings.  They should be able to report without the fear of retribution, and have confidence those points will be looked into.  In fact there should be incentives in place for finding the most critical shortcomings.  And recommendations for all shortcomings should be made a part of standard operating procedure and effectively communicated.  Executives should ensure that the cycle goes on.
                        3. Productivity: As important as patient safety, is increasing productivity and controlling costs.  As we know healthcare is a very different kind of industry, and so it must not be at the cost of care.  Also, it must be determined how benefits gained via increased productivity are channelized.  Benefits gained in terms of executive time and resources should be deviated towards something strategic.  They could be diverted towards being price competitive, or spending time and resources becoming even more productive.  Few of the tools being used these days are Lean, Six Sigma, Predictive Analytics etc.
                        4. Public Policy: Healthcare executives are invaluable in public policy formulation.  They have access to invaluable information from their staff and community agencies. 
                        5. Interpersonal Skills: They form the cementing medium of above mentioned points.

Bitter Pill: Why Medical Bills Are Killing Us – IV

ref : Bitter Pill: Why Medical Bills Are Killing Us

  • It was prudent step on the part of insurance companies and other regulators to promote outpatient services.  But, businesses being businesses they’ll make profit either way.  A better idea would be pay for treating the patients and leaving up to the hospitals how they do it.  Believe me they’ll still find ways to make money and the only way is to allow greater competition.  We have seen great anti-trust law suits helping avoid monopoly in every sector, its time for such in healthcare sector.  Hoping that ACA will do its part, but I am pretty sure that it will not be sufficient.
  • Also, the reporting of charitable expense too should be reported accordingly.  Not as a %age on the mark-up price (chargemaster)  but on actual cost incurred.  It can be argued that his will increase the %age figure and show them more charitable than the others. 
  • Regarding doctors compensation by medical device manufacturers, its good that it is being disclosed by a website.  But, it helps only so much as patients have no choice when it comes choice of device, e.g. hip-knee implant.  What if the choice is genuine and doctor had also benefitted directly or indirectly?  The best way out is not to kill competition in any way.  Administrators may agree that signing contract with one or few might fetch them discounts, but it pretty much kills the competition.  Also, they can also seek greater discounts when all the manufacturers are in fray.  The article rightly states that the biggest problem is the mark-up prices that the hospital charges the patient, and not physician’s choice of equipment or the benefits being doled out to them.

Bitter Pill: Why Medical Bills Are Killing Us – III

ref: Bitter Pill: Why Medical Bills Are Killing Us

  • Unlike other industries, technology in healthcare increases costs.  New and better diagnostic equipment is costlier, even though not always necessary for you.  You can trusts doctors to not use it if not really needed, but for the threat of being sued.
  • There is little patient pushback for these treatment for variety of reasons: getting treated is their topmost priority; unlike other services cost is not discussed upfront with doctors; if your insurance covers you for it, then all the more reason not to discuss; no matter how much researched, patients aren’t qualified enough to argue with the doctor and discussing cost versus benefits with patients makes doctors decision making rather difficult.
  • Sad that safe harbour reform was shot down, under which physicians and hospitals could have argued that they provided care that was within bounds of what peers have established.  It is a known fact that it is not new more expensive tests that save lives, but timely intervention.  Considering how little time doctors pay examining their patients, no amount of tests can counter lack of proper clinical judgement.  That would have also blunted the typical plaintiff argument that more test would have saved patient’s life.
  • The article talks about ad campaign by AHA that Congress not cut hospital payments as that would endanger billions the hospital provide as care to poor or those failing to pay their debt.  Well is that discount they talk off on highly marked up chargemaster price?  Where the latter itself has no basis.