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.     

A Medicare reform primer

The use of the federal budget process to change Medicare policy is of importance to physician executives because of its impact on the health care delivery system. In particular, changes in Medicare policy, driven by the need to shore up the solvency of a politically popular program, will create changes for other public and private purchasers of health care. Reforming Medicare through the budget process is not new. Physician fees have been frozen, reduced, and selectively increased as a result. In 1983, the hospital reimbursement methodology was changed to prospective payment through this process. The budget process will continue to be used to make policy changes because of the large amount that Medicare occupies of the federal budget. Given the profound impact changes in Medicare can have in other health care sectors, the lack of consensus for a long-term solution would mean those in the health care arena will have to be prepared for significant annual policy changes through the reconciliation process.     

Self-directed health plans: alternatives to managed care enabled by new technologies

Few people believed the Internet would have much impact on the delivery of health care services. However, combined with technological advances in how computer systems are structured and implemented and knowing what doesn't work in managed care from bitter experience, the Internet is being used to create a new paradigm of alternative health insurance products. These products hold the potential to change for the better the face of health care as we know it. Self-directed health plans will be less expensive than managed care programs and offer greater predictability in health care spending. For health care providers, SDHPs' reliance upon episode allowances will create a new market for packaged or bundled services. Providers will be paid to provide solutions, not just treatment. This could represent a new model in which physicians accept a risk-adjusted payment and provide a warranty that they will do whatever necessary until the patient has reached the reasonably expected health status. This is a radical departure from the fee-for-service or capitation system.     

Purchasers and the impact of managed care on physicians

In much the same way that demands by managed care organizations are shaping the way physicians practice, health care purchasers impact how managed care organizations operate. Corporations purchase managed health care through their employee benefits programs, and understanding the language, objectives, and limitations of these purchasers is essential to grasping the forces influencing managed care organizations and the modern practice of medicine. The emergence of value-based purchasing as a strategic corporate approach to health benefits programs will dictate the forces on physicians, hospitals, and managed care organizations for years to come. These forces have already led to price reductions, health plan accreditation, employee-directed report cards, outcomes management, and organized systems of care, and they will determine the broad outlines of the emerging U.S. health care system.     

Re-forming the traditional organization medical staff

The traditional, two-bylaws-model organized medical staff was created in another age (1919) to serve a simple health care system, controlled by physicians, in which the only players were patients, doctors, nurses, and small hospitals. This medical staff model does not meet the needs of the U.S. health care system of the 1990s. The purpose of this article is to provide the physician executive with a resource to use when he or she is called on to help determine what, if any, changes are needed in his or her organization to make the role of physician leaders more effective. Finding the right answer to this question is part of discovering ways to reduce health care costs without reducing the funds available to pay for direct delivery of health care services. Maintaining traditional, bureaucratic, legalistic organized medical staff activities is a very expensive game that we can no longer afford to play.     

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.     

Strategic issues requiring public accountability: food for thought

Although the exact outline of U.S. health reform has become fuzzy because of political events, it seems clear that major changes in the manner in which health care is delivered and financed are under way. The initiative for the most part has been assumed by state government and by the health care field itself, as managed care becomes ever more entrenched and the health care system becomes ever more integrated. An expected outcome of these changes will be demands for greater public accountability on the part of health care providers and organizations. In this article, the author discusses some of the issues--professional compensation, documenting community service, ensuring public input into planning efforts, economic credentialing and quality of care, and managing ethics under managed competition--that will have to be addressed at the local level as these shifts take place.     

Physician executives: managers first, clinicians second

The literature is replete, many would say depressingly so, with accounts of the changes that are rocking the health care delivery system. The demands on the system's leadership increases with every change. And the future holds even more changes, with a level of uncertainty that will makes today's demands seem childplay. Physicians, especially physician executives, will surely be key factors in helping the system maintain its fundamental charge of high-quality patient care provided at reasonable cost, but what exactly is expected of them? One point is clear: While their clinical backgrounds will continue to arm them well for reaching the executive suites of health care organizations, physicians who hope to fully succeed in management will have to acquire and master a widening range of management skills. An indication of just how demanding the health care management job will be is provided in this report, based on interviews with physician executives and the people who seek and sell their services.     

Culture in chaos: the need for leadership and followership in medicine.

The health care industry is changing at a dizzying pace and most of its players are struggling to maintain some form of the status quo. But resisting change will not prove fruitful--ultimately, it will rob physician executives of the opportunity to be architects in designing a new, more efficient health care system and their role in it. Because health care is a complex adaptive system (CAS)--change occurs rapidly and events are unpredictable--the old command and control style of leadership and a linear way of interpreting events is too rigid and, therefore, an ineffective model for guiding change. Complexity science offers insights about leading for change. In CASs, changes emerge in response to environmental demands for adaptability. Since the nature of these demands is unpredictable, the role of leadership is to manage the relationships and context out of which these changes emerge. A leadership style is called for that leads to purpose, makes positive changes by influencing context and relationships, and takes followers to a better place.     

Hospital role on decline.

The era of hospital dominance of the health care field has ended. The new day will belong to insurers and payers. Health maintenance organizations will become the primary actor on the health care scene. If PPOs are added to HMOs, and by 1990 most PPOs will look like HMOs, 70 percent of the U.S. population will be enrolled in such plans. By that time, at least 10 percent of the nation's hospitals will have disappeared.     

Health care costs tied to many issues

Although, in 1990, the United States spent about $750 billion (12.2 percent of the Gross National Product) on health care, 31-37 million people in this country are uninsured. Another 4 million people are thought to be underinsured. We have one of the highest infant mortality rates among developed industrialized nations and rank 19th in health care and well-being among those nations. Our life expectancy is lower than those of some third-world countries. The United States and South Africa are the only two industrialized nations without a national health care policy. In spite of these statistics, U.S. health care costs continue to rise and, by the year 2000, are expected to reach $1.5 trillion (15 to 17.5 percent of the GNP. Per capita spending on health care will reach $5,515 by the year 2000, compared with $2,425 in 1990 and $1,016 in 1980.     

Health policy guided by five questions

As the U.S. Congress pursues a course for the restructuring of the U.S. health care system, it will have to carefully evaluate potential solutions in terms of their effect on cost and access. This article explores five questions, the answers to which will have to guide any health care policy changes at the federal level.     

The health care system should produce health

Reform of the U.S. health care system along the lines to be proposed by the Clinton Administration will not be an easy task, and it will not be accomplished quickly. A fundamental objective of the changes should be a health system whose purpose is improvement in the health of U.S. citizens, and not just the provision of services to all. This column is jointly edited by Kevin M. Fickenscher, MD, and David A. Kindig, MD, PhD, chair and member, respectively, of the College's Forum on National Health Policy. Dr. Fickenscher is participating in various advisory capacities on health care in the Clinton Administration, and Dr. Kindig is Senior Advisor to HHS Secretary Donna Shalala.     

Will physicians replace MHAs?: reflections from Australia

Tom Weil, in the preceding article, sees the physician executive playing an increasingly significant role in negotiations between payers and service providers, in offering the public acceptable explanations for the inevitable changes in the provision of care, and in developing more cost-effective methods of delivering high-quality health care at affordable prices. Effective involvement of physician executives will be facilitated by their having received professional training somewhat different from that of the traditional MHA. How do these prognostications relate to the health care scene in Australia? Factors that must be taken into account in considering their applicability to Australia include differences in the structure and management of the Australian health care system, the current state of that system, the background of the leadership that makes the key managerial decisions in the Australian system, and emerging trends within the system.     

Hungary: a health system in transition

Hungary has an area of 93,030 square kilometers (35,900 square miles), the size of the state of Indiana in the United States. It is landlocked by the Czech Republic and the Slovak Republic to the north, Austria to the west, Yugoslavia to the south, and Romania and the Soviet Union to the east. Although the health care system is based on the Soviet system, there have been dramatic changes since 1991, when the soviet Union and its Eastern European partners discarded their communist structures and the Soviet empire was disbanded. In this report, the current Hungarian health care system and the political structure in which it is housed will be described in terms of a key set of characteristics and their subparts. The purpose of this approach is to facilitate comparison of the Hungarian system with other national health care systems. An expanded version of this article will appear in an upcoming second edition of the College's book, International Health Care: A Framework for Comparing National Health Care Systems, by Drs. Mendoza and Henderson.     

Community rating--an approach that works

How our current system works and what changes need to be made are the subjects of intense scrutiny by policy makers today. One of the primary areas of concern with our present health care system is its accessibility to the average American, in terms of both price and ability to obtain insurance. With an estimated 37 million Americans without health care insurance, and countless others severely underinsured, this issue will lie at the core of any health care reform that results from the current debate. One possible approach to the uninsured problem that might alleviate the situation is community rating.     

New governance for a new era: issues and challenges for integrating systems

In this second part of a two-part column, Dr. Ruffin provides greater detail on seven key factors that he believes will govern the operations of integrated systems. Successful systems, he says, will be those that attract and retain physicians, have disciplined governance, integrate care through sharing of information among system elements, conserve capital, ensure strategic growth, control costs, and are proficient at processing information. It is important to understand, he says, that, in the movement from a fee-for-service payment mechanism, in which the various elements of the health care field bill for their services independently and according to rules designed for their benefit, to an integrated system, in which such independence can only lead to chaos, very substantial changes will be required in the governance of our health care institutions and organizations.     

Dealing with the demands of change

If evidence of the changes occurring in and confronting the health care field were needed, it was provided in abundance at the College's Perspectives in Medical Management meeting in Chicago in May. The presentations and the discussions among members buttressed the feeling that the health care field is proceeding through a period of transformation. The evolving system will be anchored on managed care, with special emphasis on the word "managed." The accoutrements of managed care--case management, demand management, utilization management, clinical guidelines and protocols, capitation budgeting, and the like--dominated discussion. The "business" of health care is proceeding apace. Maintaining a balance between the financial and quality elements of health care delivery has never been more important. And the definition of that balance will be determined at the local and regional levels. Federal initiatives are temporarily in abeyance. The challenge for physician executives is to assume leadership in moving their organizations, and thus the health care system, toward a new design that corrects present deficiencies and positions both to respond more effectively to the health care market. While it is not possible to cover all of the more than 60 speakers who addressed the meeting, this report, through presentation of the ideas of some key presenters, is aimed at measuring at least the boundaries of the challenges that lie ahead.     

The coming alliance revolution in health care

Like it or not, the health care profession is being "shifted" into a revolutionary new world. The question is not will it change but rather how will it change? Who will determine its fate? What form will these changes take? What are the best alternatives for physicians, institutions, health care workers, insurers, employers, and, most importantly, patients? Some of the changes will come from government mandate, others from market forces. To understand what the future might bring, we should look at both the driving forces behind the changes and how other industries have responded to similar forces. An important consideration for health care professionals will be how, if at all, the concepts of collaboration and cooperation that are inherent in networking and alliances will guide their planning.     

The consumer choice model: a humane reconstruction of the U.S. health care system

"Consumer choice," "defined contribution health programs," "voucher systems," and "health marts" are variations on a theme: employees buying their own health care. This new approach to health care purchasing, which is designed to minimize the role of employers, is being proposed by an array of economists and by both Republican and Democratic legislators as the best way to address the nation's health care ills. Although enabling national legislation is unlikely to pass soon, the debate will nevertheless change the face of health care in America. The prospect is reminiscent of the debate over "Clinton Care" in 1993--although legislation was never passed, managed care rapidly came to dominate the U.S. health care system. As this reform takes hold, beneficiaries will make their own health plan selections but will have more responsibility and may bear more cost. Providers will have to adapt to new, customer-driven requirements for performance, accountability, and communications but will also find opportunities in a marketplace that they will have a major role in shaping. Physicians, health plans, and insurers should understand how these proposals will transform their role in health care.