Thursday, May 31, 2007

David Drake’s Book

I complain with some frequency about people who advocate redesign of our health care system without suggesting what the redesigned system should look like.

So it was with more than a little pleasure that I learned about David Drake’s new book titled Mandate for 21st Century America and subtitled Universal Health Insurance.

David might appreciate my pointing out that Universal Health Insurance is not synonymous with national health insurance.

David and I have had our debates about his suggestions, but I will testify that they are coherent and carefully thought through. As his title suggests, he focuses mainly on the financing system but his proposals have clear implications for the delivery system, as well.

The book is a fairly short read (172 pages including bibliography and appendices) and is available from Amazon.com (I checked to be sure).

Veteran toilers in the vineyards of health care will remember David for his 25 years with the American Hospital Association, retiring some years ago from the position of Senior Vice President and Secretary-Treasurer.

Monday, May 28, 2007

Business or Ministry?

Redesigning our health care system would be easier if we could decide whether health care is a business or a ministry.

When I began my career over 50 years ago, health care was a ministry – no doubt about it. That was why religious organizations had played such a large role in it. In 1965, it was the logic behind Medicare reimbursing hospitals their actual cost of providing services. It hadn’t occurred to anybody that the system could spend too much money or have the capacity to provide more health care than we needed.

Considering health care as ministry has implications. One is that it ought to be encouraged and supported, not stifled by things like government regulation. Another is that it would be vulgar to subject it to market forces like competition. Still another is that the people who provide it are somehow noble, above the level of ordinary people.

That point of view still prevails to a considerable extent. The May 14, 2007 issue of Modern Healthcare featured Ascension Health, a Catholic, 61-hospital system based in St. Louis. Its annual operating revenue was $11.4 billion in 2006, more than that of Amazon.com or Google or Southwest Airlines. Its operating margin was 4.2%.

Anthony Tersigni, Ascension’s president and CEO, was quoted in the article as saying “We are a ministry. We’re not a business. We do use business practices for one basic reason: We have bondholders who are counting on us to repay the bonds.”

To say that an eleven billion dollar operation with nearly a half billion in profits is not a business stretches the language. On the other hand, it is no doubt true that Ascension’s leadership believes that doing good is its basic mission.

Maybe we are being trapped by labels. Maybe Ascension is both a ministry and a business. Maybe we should be glad that Ascension believes in its mission of ministry. But at the same time, maybe we have a right to be interested in how it is managing that eleven billion dollar business.

Sunday, May 20, 2007

Live and Learn

The decade of the 1960’s was an exciting time to be working in health care, one of the main beneficiaries of the pent-up wealth and energies being released during the post-World War II period. Expansion was going on everywhere and there was great receptivity to ideas and innovations.

Concern about cost was being expressed even then and a common justification for many new approaches was that they would improve efficiency.

I was an administrator at the time, feeling the pressure to find the resources to implement these supposedly better ways of doing things while being responsible for operating within a finite budget. That experience ultimately led me to observe that whatever we did to improve efficiency seemed always to cost more money.

That and other experiences also led me to the more general conclusion that in health care, if it was better it cost more.

I believed that until the early 1990’s, when I was first exposed to the concepts of the renowned quality guru, W. Edwards Deming. Deming taught that the continuous process improvement needed to improve quality would also reduce cost by eliminating rework, cutting waste, and generally improving efficiency.

Apparently he was right. The magazine Modern Healthcare annually publishes a list of what it calls the 100 Top Hospitals. The group is compiled in cooperation with Solucient, an Evanston, IL-based healthcare information company. This year’s selection was published on May 7. Its sub-heading read “The organizations on the 100 Top Hospitals list give higher quality care at a lower cost, while paying their staffs better.” The publication went on to identify the evidence on which that conclusion was based.

So it seems that the quest for quality improvement is supportive of efforts to control cost, not in conflict with them. That may be counterintuitive, but apparently it is true.

I guess one is never too old to learn something new.

Friday, May 18, 2007

A Step towards Reform

While everyone is bemoaning the need for health care reform, it is going on as we speak.

Among the most important barriers to reform has been the division of health care into institutional (e.g., hospital) and professional (e.g., physician) sectors. While they are, in practice, indivisible, neither has taken responsibility for the other. The result has been an absence of accountability for performance. Without accountability, reform became very difficult because no one had responsibility for doing it.

That is changing.

In an article titled “Hospitals tie CEO bonuses to safety” (The Boston Globe, May 5, 2007), reporter Christopher Rowland points out that about half of the non-profit hospitals in the U.S. are now including patient safety in the criteria for awarding performance bonuses to their CEOs. Safety factors include checking of patient IDs, tracking tissue specimens, cross-checking medications, and hand washing.

This development marks a huge shift in the culture of health care. In the past, safety issues such as these were considered clinical matters in which direct administrative involvement was taboo. Administrators could urge their professional staffs to address them, but going further than that was to put their jobs at risk.

The next step will be to hold administrators accountable for clinical outcomes. It, too, will be large one. But it will be easier than making them accountable for safety now that the barrier against administrative involvement in clinical matters has been breached.

Wednesday, May 02, 2007

Who Should Pay?

Could a hospital justify subsidizing computers for its private practice physicians by claiming that doing so would facilitate the development of an electronic medical record? Or would it be considered a kickback for admitting patients to the hospital?

That has been an issue for some time now. Recently, a conflict has arisen between federal anti-kickback rules (the Stark law) and the federal policy of promoting the computerization of medical records (See “Stark Redo.” H&HN, February 07).

A major goal of computerizing medical records is to make information about the patient more readily available to whoever is caring for the patient. Thus, it would clearly be beneficial to include information from the office of the patient’s doctor. But that requires that the doctor’s office records be computerized and tied in to the hospital’s record. The question is who should pay for it? The doctor is understandably reluctant to pay for something that will mainly be of benefit to others. Hospitals are in many cases willing to pay as a community service, but are fearful that doing so will violate the anti-kickback laws.

This issue is another example of the problems created by the separation of the professional (e.g., physician) and institutional (e.g., hospital) components of our health care system.

The patient and his or her medical condition may be a single entity, but because of the way the system is organized, we have long treated the inpatient and outpatient phases of care separately. At one time, even hospitals that operated outpatient clinics (usually for the poor) kept their inpatient and outpatient records separately and I can remember when combining them was seen as a progressive development. The implications for duplication of effort and fragmentation of care are obvious.

As we move towards the redesigned health care system of the future, hospitals and doctors will combine into a single organization - a process that is going on as we speak. Progress in that direction will make it easier to resolve a number of issues, including who should pay for computers.

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