Leading health care into the 21st century.

If there is a consistency in the professional lives of those who manage in the health care field, surely it is characterized by inconsistency. Change. For more nearly two decades now, since the full impact of the Medicare/Medicaid legislation hit, the health care industry has undergone profound, continual, and lasting change. Success can be measured largely in terms of how well a professional or an organization accommodates and manages these changes, making sure that they work for the organization and the career and not against them. The 1990s can be expected to be just as full of change and turmoil as have the past two decades. "What's past is prologue," Shakespeare wrote. The health care field is not apt to see the murderous machinations of The Tempest, but clearly exciting and challenging times lie ahead, and perhaps the outcome will be as positive as Shakespeare's. The scenario that follows provides a glimpse at the issues of change that will occupy the time and energy of physician executives for the coming decade.     

Physician-centered management guidelines.

The "Fortune 500 Most Admired" companies fully understand the irreverent premise "the customer comes second" and that there is a direct correlation between a satisfied work force and productivity, service quality, and, ultimately, organizational success. If health care organizations hope to recruit and retain the quality workforce upon which their core competency depends, they must develop a vision strategic plan, organizational structure, and managerial style that acknowledges the vital and central role of physicians in the delivery of care. This article outlines a conceptual framework for effective physician management, a "critical pathway," that will enable health care organizations to add their name to the list of "most admired." The nine principles described in this article are based on a more respectful and solicitous treatment of physicians and their more central directing role in organizational change. They would permit the transformation of health care into a system that both preserves the virtues of the physician-patient relationship and meets the demand for quality and cost-effectiveness.     

The role of the coordinator of care

Regardless of the specific outcome of the current health reform debate in Washington, it is likely that major changes to the health care system are in the offering. These changes, many of which are already in place or imminent in some locations, will have a major impact on the evolving relationships between physicians and hospitals. Most expect that these changes will accelerate the development of integrated health care delivery systems that will compete in the marketplace for a mixture of public and private health insurance dollars. In this system of "managed competition," health care dollars will flow to those systems that can ensure the best clinical outcomes while using the least economic resources. In this scenario, competing collaborative health networks that can manage the continuum of care will be central to the health care delivery system. The economic and political ties between physicians and hospitals will become more closely linked as government and private payers of health care services foster the development of these integrated, value-based health care delivery systems.     

Shifting power: is the consumer next?

Consumers are not likely to act as patients much longer. They'll demand the same level of information and service they receive from every other sector of the economy. Dozens of new, innovative companies are changing the health care coverage purchasing methods to allow more control and accountability for consumers. They can be broadly categorized into four groups: (1) the "Charles Schwab" clones, (2) spot markets, (3) "make me a doctor," and (4) personalized health care systems. Physicians become directly accountable to their patients in these new models. But choosing health plans may not be enough. It is only a matter of time before consumers demand the right to build their own customized heath plans using the defined contributions from their employers. This article describes the benefits of personalized health care systems and why the death of medical necessity is not far away.     

If patients are now "customers," what does that make physicians?

As patients become "members" and "customers," as physicians become "practitioners" and "providers," the practice of medicine becomes more complex and more demanding. The changes that have affected the daily lives of physicians across America will continue and will likely become even more dramatic in the future. There is much to mourn in the passing of the medical practice of the recent past, but there is every reason to celebrate the ongoing triumphs of medicine and its successes in improving the human condition. The job of being a physician is not becoming any less important. The job has just gotten tougher. Successful physicians will cope with the multitude of changes in which the health care field is engaged and make themselves effective agents of change within their organizations.     

Provider-sponsored networks. Physicians organize for direct contracting

The Provider Service Network (PSN) concept is part of a wider movement by physicians to restructure for managed care to improve bargaining leverage for America's more than 600,000 active medical practitioners. Direct contracting has a simple appeal--no intermediaries. Imagine managed care contracts without the costs or hassles of an HMO or third-party intermediary. The PSN is a new form of managed care organization, but without the middleman. Savvy, self-insured employers, business coalitions, and government health programs are the potential "buyers." Doctors and hospitals are the "sellers," organizing provider networks on a regional and statewide basis. Up for grabs are over 225 million consumers whose health benefits are currently managed by insurance plans, HMOs, and third parties. This new marketplace of direct contracting may sound to doctors like the Garden of Eden, but there is plenty of opposition. PSNs will not become a national trend without a fight.     

The future of American health care in the "post-reform" era

"As the debate over health care reform rages in Washington, the market is reforming itself. For any given market, it's a question of 'How soon will it hit?', not 'Will it hit?'" Health care reform and market restructuring are ushering in a new era of integrated health care. Although the future is not fully clear, there are at least three competing models for the creation of regional and statewide health systems that will integrate the financing and delivery of services to large enrolled populations of consumers: Payer-driven networks. Provider-sponsored systems. Partnership models. Whatever the future scenario, physician executives will play a larger, more dominant role. Research on integrated health systems has identified three critical success factors for future success: physician-hospital integration, clinical integration and information integration. For managed care to be successful, there must be clinical leadership. The essence of managing care is clinical efficiency, based on "critical-path" treatment protocols and real-time patient care management, supported by integrated information systems.     

The AMA faces down FDR and wins

There are two types of change that can occur via federal health care legislation: expansion in access and cost containment. Without passing judgment on the advisability of legislative change, I will argue that federal legislation is unlikely to occur unless both the executive and the legislative branches of government are controlled by the Democratic party. I am not suggesting that the change is necessarily an "improvement," only that Democratic Party control is necessary, particularly as the change pertains to access.     

Enhancing efficiency: step by step

The debate over which mechanism for health care delivery will provide the widest, most efficient access has reached a crescendo. While the debate on the macro level accelerates, many significant approaches continue to be discussed and implemented on a micro level. Among these activities are imminent release of the final rule on "Criteria and Procedures for Making Medical Services Coverage Decisions that Relate to Health Care Technology--Medicare," implementation of the Safe Medical Devices Act of 1990 by the FDA, and a proposal that payers establish a cooperative national technology assessment program.     

The theory of S-curve discontinuity in the medical care field

Confusion reigns supreme in the health are field today. In a previous paper, I described my thoughts about the reasons for this chaos. This article reviews the gradual escalation of health care costs and many of the unsuccessful methods to control them, reiterates the theory of S-Curve discontinuity in health care and develops a "tool" that will enable physician executives to determine whether or not a product or process in health care will succeed in the near and distant future. This new tool can be of value to all health care providers, investors, health planners, politicians involved in evolving health care legislation, and any others who have an investment in the future of health care.     

High expectations mirror high stakes for physician executives

Because the stakes in health care are high, physician executives are challenged to meet high expectations set by their CEOs and boards. These may be unrealistic--for example, demanding that physician executives possess expertise in finance or strategic planning. Job stresses for physician executives are specific to the role, but are not unlike those faced by other senior executives. It's a fact that professionals leave jobs for any number of reasons; sometimes, not through their own choice or fault. Thus, every time a physician executive leaves a job, it should not be characterized as "being fired," and not every job-leaving should be taken as a failure. Accept that you may make mistakes while doing the best job you can. Rely on your own value system and integrity to see you through.     

Lessons from industry.

Rapidly emerging in public debate as the key to the future of the health care industry is quality. One can hardly pick up a health care magazine or journal or listen to a discussion among health care professionals without quality becoming a concern. Despite virtually universal agreement on the importance of the generic term and secondary agreement on the importance of being able to measure it, discussion bogs down in either of two ways. It may become overwhelmed by the sheer magnitude of the task of describing all the elements of health care quality, or the different viewpoints of individuals will yield quite variable understandings of what the term "quality of health care" means. To make substantial progress in improving health care quality, we will need to come to an agreement on terms.     

Leadership for the next millennium: the physician executive

We continue to muddle through using tourniquets and bandaids on a health care system that is in dire straits. And the future is even less promising. There will be millions without basic health care, let alone basic health care coverage. Rural and inner-city hospitals will close, with progressive public apathy, as we focus on the marvels of expensive technologies that serve only the few. Costs will continue to rise at double digit rates, and our nation's employers will fall further behind in the global marketplace. Preventive care will be uncommonly provided and only more rarely reimbursed, while a couple more children die of measles in Mississippi. It's not a pretty picture, and it simply doesn't have to come to pass. "What we really need is leadership," the public cries. That leadership can and should come from medicine through physician executives.     

Ascendancy of primary care will create role intensification for physician executives

The need for physicians in management roles in the health care system has never been greater. And the years ahead will see that need broadened and intensified. To maintain their leadership role in medical affairs in hospitals and other types of health care delivery organizations, physician executives will have to envision provider organizations and systems that have not yet been conceived, let alone developed and implemented. They have to become totally open-minded and futuristic in their thinking. And they will have to help other physicians accommodate this new way of thinking if the medical profession is to continue in a leading role in health care matters. Although numerous factors will have to be anticipated and analyzed by these new physician leaders, the ascendancy of primary care in a managed health care world long dominated by the technical and technological superiority of hospital care will present a particular challenge to the physician executive.     

Standardizing medical data

Congress passed The Health Insurance Portability and Accountability Act of 1996 in the doldrums of last Summer, and promptly charged the National Committee on Vital and Health Statistics to begin working on the regulations that will help providers, payers, and all members of the public adhere to the spirit of the law. What does this legislation portend for the health care industry? Standardization of information systems will play a large role in assuring the portability of health care insurance from one employer and payer to another in this legislation. Accountability, too, will depend on those same data standards to allow comparisons of processes and outcomes of care across health plans, providers, communities, states, and regions. In fact, without standardized data describing patients and their treatments, there can be no comparisons of their outcomes of care, or the processes used to treat them.     

The Commission White Paper on a Strategy for a Future EU Chemicals Policy: The View of European Companies of American Parentage

After years of good service, EU legislation on chemicals is currently subject to a major review. This process, initiated by the Council of Ministers at Chester in April 1998, will soon lead to new legislative proposals. In the meantime, a review of the Commission's White Paper on "Strategy for a Future Chemicals Policy," published in February 2001, clearly shows that the regulatory landscape in this area will be significantly reshaped and that a new burden will be imposed on industry to demonstrate that the production and use of chemicals indeed conform to high standards of protection of human health and the environment. In the view of industry, on both sides of the Atlantic, while the objectives of the proposed reform can be supported, the measures proposed in the White Paper to implement these objectives are not properly balanced and will lead to substantial societal and economic drawbacks, unless significant adjustments are made. The purpose of this article is to present the pitfalls and difficulties of the reform as they are perceived by the EU Committee of the American Chamber of Commerce in Brussels, an organization that regroups about 150 European companies of American parentage, belonging to a broad range of European business sectors, including producers and users of chemicals. In view of the transatlantic and cross-business character of its membership, the EU Committee offers a different perspective on the debate.     

The great health policy debate of 2010

Moderator: Good evening. Tonight I will be moderating a debate on the Health Care System Salvage and Coverage Overhaul Act of 2010 (Senate Bill 1, with companion legislation in the House). The bill is awaiting final congressional action, and the issue is considered so important that all 14 major television networks are carrying this debate live, along with many radio networks and at least 1,873 Internet/World Wide Web sites. As you know, S.B. 1 would provide immediate federal aid to the 1,000 hospitals and health care systems that are currently in bankruptcy; extend government-subsidized coverage to the estimated 90 million Americans who lack it; return to the federal government a wide range of health care regulatory and payment activities that had been transferred to the states; and prohibit certain types of health care enterprises and services, chiefly proprietary delivery and managed care systems. At the moment, the chances of its passage are too close to call. Arguments in support of S.B. 1 will be presented tonight by Sen. Joseph P. Kennedy II, Democrat of Massachusetts; arguments in opposition to the bill will be presented by Sen. George W. Bush, Republican of Texas; and the view of the Independent Party will be presented by former Kansas Senator Nancy Kassebaum, who also speaks as chairman of the National Nonpartisan Commission to Save American Health Care. Senator Kennedy will begin.     

Global view offers good news for physician executives

Do all physician executives have much "catching up" to do in relation to their non-MD colleagues? A comparison of the role of the physician executive versus the non-MD executive/administrator provides a big picture view and signals new opportunities for physicians in the evolving health care system. Physician executives have only recently become invested in the health care executive suite and are less wedded to old methods and "classic" ideas. They are more likely to be able to adapt to new circumstances, jettisoning traditional approaches that have outlived their usefulness. But each group-physician executives and their MHA- or MBA-credentialed, non-MD colleagues- has much to offer to or learn from the other. By retaining those skills that are applicable, while also adapting the useful characteristics of the "traditional" health care administrator, a physician executive can increase the likelihood of success today.     

Managed care liability.

Debate is heating up concerning proposals that patients have the right to sue their managed care plans for damages from wrongful denial of benefits or delays in care. Some states have recently passed legislation to address this issue and it is expected to be an area of intense legislative debate during this year. As managed care entities increasingly enter the realm of medical decision-making, the additional burden of this responsibility is taking shape. Whether managed care plans should be treated like providers of care and be held accountable for decisions that impact patient outcomes, or be viewed only as insurers is a policy question of immense proportion.     

Leading beyond the bottom line, Part 4. The questions it has raised

The Leading Beyond the Bottom Line article series has received an overwhelming response from ACPE members, mostly in enthusiastic support of this new leadership concept. Some of the important questions raised by members are presented with answers from the authors. This article also explores the moral challenge of leadership and why health care is more than a business. In recent years, there's been confusion about the role of the health care enterprise, its leadership and its management. We have lost our way about the "moral" thing, the "right" thing, because we have no philosophy to guide us. To manage or lead in this "business" of health care, a philosophy is required that recognizes the multiple elements to which the leader has responsibility and obligations: the customers, community, employees, and, certainly, the financial assets.