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.     

Making the journey into the networked enterprise, Part 2

In the May issue of Physician Executive, the authors described the difficulties other industries have had with vertical integration and why so many corporations have abandoned it for other organizational structures. In this second part of the series, they explore the ways health care organizations can make the shift into integrated delivery systems, avoiding the trap of the hierarchical, vertically integrated monolithic structures that will become the dinosaurs of the future.     

Interdisciplinary and Interorganizational Research: Establishing the Science of Enterprise Networks

We review and discuss the evolution of interdisciplinary and interorganizational research in operations management and suggest directions for future investigations. The proposed operations management research focus is one that embraces a more holistic view of an “extended enterprise” which involves working with a new business model—the organization as a network. This methodology starts by treating the organization as a system that is enabled by information technology and is characterized by ubiquitous information sharing across traditional enterprise. Proper integration of technology, business processes and people factors needs to be developed to create higher value from networked enterprises. Operations management research future lies in establishing this science from an interdisciplinary perspective. We analyze this perspective in the context of papers published in the first 50 issues of Production and Operations Management and the related literature.     

Information technology, Part 3. The technology hierarchy

The era of the networked society--and medical care depending on networked intelligence--is dawning. Physicians need to plan for office practice information systems in common, with an eye to conveying data electronically between all the locations of care and all the providers involved in caring for defined populations of people. The shared database will become the most important asset of the collection of providers who make up the delivery system that creates it. This will be accomplished by layering technology on local and wide-area networks of group practices, hospitals, health plans, and payers and developing standards that make data accessible in the same format to all users, no matter where they are.     

Health care applications of complexity science. Life at the edge of chaos

The authors explore complexity science, a relatively new field of inquiry, which holds for both clinicians and health care leaders the real possibility of stimulating fresh insights and approaches to health and medical care-both its provision and its organization. Two case studies are presented to illustrate how complexity theory can provide health care leaders with a new perspective on how to address the myriad challenges they confront daily: (1) a patient with dissociative identity disorder; and (2) a physician task group charged to advise on hospital medical staff reorganization and governance. These case studies help clinicians and leaders of health care organizations understand how complexity: (1) may be relevant, even helpful, as they consider difficult challenges in both patient and organizational management; and (2) might emerge as a synthesizing force as they face the extraordinarily complicated task of jointly creating integrated health care systems. A resource section is provided for those who may wish to further pursue the topic.     

I was a medi-cop

When I became an inspector for the New York State Health Department, I realized that I would not win any popularity contests, but I believed that I would be improving the quality of care in the 32 hospitals controlled by our area office. I decided to take the job in a desperate move to escape from primary care responsibilities that had been growing more onerous daily. This article tells of my experience as a health care regulator and why I returned to work for a health care provider.     

Responsive supply chain: A competitive strategy in a networked economy

Supply chain management (SCM) has been considered as the most popular operations strategy for improving organizational competitiveness in the twenty-first century. In the early 1990s, agile manufacturing (AM) gained momentum and received due attention from both researchers and practitioners. In the mid-1990s, SCM began to attract interest. Both AM and SCM appear to differ in philosophical emphasis, but each complements the other in objectives for improving organizational competitiveness. For example, AM relies more on strategic alliances/partnerships (virtual enterprise environment) to achieve speed and flexibility. But the issues of cost and the integration of suppliers and customers have not been given due consideration in AM. By contrast, cost is given a great deal of attention in SCM, which focuses on the integration of suppliers and customers to achieve an integrated value chain with the help of information technologies and systems. Considering the significance of both AM and SCM for firms to improve their performance, an attempt has been made in this paper to analyze both AM and SCM with the objective of developing a framework for responsive supply chain (RSC). We compare their characteristics and objectives, review the selected literature, and analyze some case experiences on AM and SCM, and develop an integrated framework for a RSC. The proposed framework can be employed as a competitive strategy in a networked economy in which customized products/services are produced with virtual organizations and exchanged using e-commerce.     

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.     

Making integrated health care work

This article summarizes the authors' thinking on value added in health care, and offers examples of the major strategies being implemented by integrated systems across the United States to increase their value and improve their competitive positioning. The research results are based on a review of published literature on 150 health care organizations in various stages of integration, and 20 in-depth case studies of integrating 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.     

Sometimes we're our own worst enemies

There is a sense of frustration among physicians involved in the decision and policy making processes within health care institutions. Because the endpoint is reached at glacial speed, too much time, money, and opportunity is lost. The decision making process can be repetitious and tedious because of unnecessary steps. By eliminating certain tactics and strategies employed by upper-level management in many health care institutions, the decision making process becomes more effective. This article focuses on the medical staff's role in the decision making process; explains why tactics to involve the medical staff are ineffective and why eliminating the medical staff from certain aspects of the process does not jeopardize the institution; and concludes that the hospital board and its delegates should be autonomous in the decision making process.     

What happened, what next?

Many physicians and other health care professionals breathed a collective sigh of relief when the 103rd Congress adjourned without passing the Clinton Health Security Act or any other health care reform legilsation. The ambition of this brief paper is to describe why health care reform did not pass in 1994, the issues that need to be resolved if we are to pass legislation, the political forces that will need to be addressed before legislation is passed, and the type of struggles we can expect to see in the coming session of Congress.     

In-house recruiters: on the inside looking out

Few smaller hospitals or managed care companies have in-house physician recruiting departments. Their low hiring volume simply doesn't support such an operation. But most health systems and large managed care organizations say they literally couldn't afford to be without an internal system for the recruitment of physician executives and other health care professionals. They also claim they can find a better candidate faster than their counterparts on the outside. A number of them explain why.     

The five "S" levels of enterprise health.

Whether pride, necessity, or inattention is at the root, some "slowly boiling" physicians find themselves working harder for fewer compensations of all sorts, and may not be fully cognizant of their circumstances. This article helps to diagnose and manage the health of physicians' practices and/or related enterprises. There are five levels of enterprise health, ranging from success (S-1) to shutdown (S-5), that serve as weather vanes about how the enterprise is adapting to changes in its environment. How should physicians respond to chaos and the threats of deteriorating enterprise health? A five-step approach is offered: (1) Discern what is important; (2) place and keep your program in alignment with those patient interests that will enhance your enterprise viability; (3) keep score with an internal balanced scorecard; (4) manage and shepherd your resources in a manner that demonstrably adds value to patient care; and (5) know the score and use it.     

A case of wrongful use of quality management. Summit Health, Ltd., v. Pinhas

Summit Health, Ltd., v. Pinhas liberalized the jurisdiction of the Sherman Antitrust Act to include cases of intrastate hospital credentialing. The U.S. Supreme Court decision eased the requirements for plaintiffs to sue when they perceived that health care organizations were acting as monopolies. The court removed the defense that a plaintiff had to prove that the decision of a health care organization affected interstate commerce for the case to be heard in court. Important as the case is in antitrust law, however, greater lessons can be gained by health care organizations from analyzing the events that led to the lawsuit.     

Lessons from the trenches in physician integration

Beyond the theoretical basis for integration, three core considerations stand out as the primary reasons for pursuing integration from a physician's perspective. In the authors' experience, the ability to make a case for physician integration stands or falls based on the ability of the integrated delivery system to address these considerations: Gain greater access to capital; develop human resources with talents in managed care and the full spectrum of care services; and sustain an information infrastructure. This article explores the lessons learned in pursuing physician integration.     

Part 2, Conflict management. Managing low-to-mid intensity conflict in the health care setting

Physician executives face low to mid-level intensity conflicts, day-to-day issues and problems associated with pressures and changes in the health care environment. Such conflicts can be sorted on the basis of relationship, duration, and intensity. The authors apply the five major modes of conflict management--competition, avoidance, compromise, accommodation, and collaboration--to specific scenarios taken from their work in health care and suggest guidelines for managing conflicts with peers, supervisees, and authority figures. Thorough preparation and a portfolio of skills build flexibility through the conflict management process. In part 1 of this article series, the authors presented the conflict management checklist, a diagnostic tool for assessing conflict in organizations.     

Elevating the role of medical informational officer

Consider the reasons why a chief medical informatics officer should be part of the senior management team of a health care organization.     

Integrated planning for health care organizations, especially hospitals

Planning in health care organizations is of considerable current interest in this country. Furthermore, effective planning processes require, as a necessary condition for that effectiveness, development within a framework which considers the organizational, managerial and service delivery environment.This paper examines the concept of planning in relation to health care organizations. Through an examination of the effects which proper planning can have upon industrial organizations the authors analyze the possible impacts of planning procedures upon health care institutions. Their analysis leads to certain tentative conclusions as to appropriate organizational structure which could support effective planning. Whilst the authors have yet to test their hypothesis the conclusion they draw from their initial analysis are worthy of further investigation.     

Capitation and informatics

When physicians, hospitals, and allied health professionals bill for services they render, their information processing requirements are relatively simple, at least compared to those of capitated organizations. When payers (insurers or employers) accept financial risk for the health care services of beneficiaries, they have usually invested in claims processing, membership tracking, and, under managed care, utilization review and provider profiling systems. But payers, for the most part, have not invested in electronic collection of clinical information about beneficiaries, nor have they tended to keep all claims they have processed in electronic form for study after accounts are settled and payments disbursed. In this article, we will explore why informatics is so important to capitated organizations and why payers that have traditionally taken financial risk for insuring the health care costs of populations are also learning about the importance of informatics.