Specialist versus primary care: not an easy question

The central focus in the debate to reform our nation's health care system is on cost, quality, and access. There is general agreement that there are too many specialists in the wrong places, which is said to contribute to the rising cost of health care. Physician profiling has supported the concept that some specialists are more costly than primary care physicians, although the severity of illness in patients treated by specialists may often be greater. Increasing the number of primary care providers may be a solution to reduce costs and will clearly improve access. The study reported in this article was carried out to examine the efficiency of primary care physicians and endocrinologists, a specialty that has been cited as one in which resource utilization is high, in caring for hospital inpatients with diabetic ketoacidosis.     

Merger mania: physicians beware

Corporate consolidations, mergers, and acquisitions would seem to provide immense promise in furthering the development of health networking because they affect the governance of entire organizations, rather than simply establishing revised arrangements for specific services or patients. Yet, a limited number of empirical studies have been published to date that explore whether hospital mergers actually improve access, reduce cost, or improve quality of care; and, among the reports available, the conclusions are somewhat equivocal. Physicians should be cautious of these mergers, since they seem to focus either on eliminating a direct competitor or on forming a large horizontally and vertically diversified health network that then can become a major player in gaining exclusivity in managed care contracting. With either of these merger strategies, there are antitrust-type concerns that competition among physicians and other providers will be significantly curtailed, and that consumers will end up with fewer choices in obtaining cost effective, quality patient care.     

An integrated model for measuring management performance

A model of organizational performance measurement that compels attention to the proper balance among quality, cost, and access; takes into account patient perceptions; produces clear targets for continual quality improvement (CQI); yields easily understood graphical displays; and captures health care organizations in simultaneous operation across the functions of cost, quality, and access was designed for the 22 medical treatment facilities of the Strategic Air Command. Such a tool provides practitioners, payers, and patients a range of information--from systemwide, facility, clinical service, and practitioner-specific insights on current performance to resource forecasts and easily understood targets for CQI. This case study shows that integrated performance modeling may be useful in examining many health management and reform issues.     

How much administration is today's physician doing?

The substantial changes in the organization and financing of health care services that have occurred in the United States over the past decade have helped to facilitate a growing role for physicians in health care management. These administrative roles for physicians are becoming increasingly important within many health care institutions with regard to such issues as cost containment and cost effectiveness, quality assurance and professional standards, and access to care. The growing complexity and diversity of the delivery system have created the need for more physicians to become involved in "orchestrat(ing)" the management of the medical-industrial complex."     

Promising, and delivering, health care value

It came as no surprise a year or so ago to read in Physician Executive that "Clinical decision-making is no longer the exclusive domain of the health care practitioner." The authors pointed out that consumers, as patients and as business-payers, are insisting on provider accountability, both in quality and in appropriate cost. They used the phrase "health care value" to show a balance between cost containment and quality. One managed care operation has decided to operate on the premise of health care value.     

The eternal triangle: cost, access, and quality

No matter who is in charge of health policy, no matter what his or her ideological bent, no matter whether the economy is in boom or bust, three concerns stubbornly dominate the discussion: the cost of care, access to care, and the quality of care. The main variation among them is that normally each in turn receives the most attention from policy makers, payers, and the public, over time.     

The new production theory for health care through clinical reengineering: a study of clinical guidelines--Part I

Drucker writes that the emerging theory of manufacturing includes four principles and practices: statistical quality control, manufacturing accounting, modular organization, and systems approach. SQC is a rigorous, scientific method of identifying variation in the quality and productivity of a given production process, with an emphasis on improvement. The new manufacturing economics intends to integrate the production strategy with the business strategy in order to account for the biggest portions of costs that the old methods did not assess: time and automation. Production operations that are both standardized and flexible will allow the organization to keep up with changes in design, technology, and the market. The return on innovation in this environment is predicated on a modular arrangement of flexible steps in the process. Finally, the systems approach sees the entire process as being integrated in converting goods or services into economic satisfaction. There is now a major restructuring of the U.S. health care industry, and the incorporation of these four theories into health care reform would appear to be essential. This two-part article will address two problems: Will Drucker's theories relate to health care (Part I)? Will the "new manufacturing" in health care (practice guidelines) demonstrate cost, quality, and access changes that reform demands (Part II)?     

U.S. health care in conflict--Part I. The challenges of balancing cost,quality and access

Grappling with a technology explosion, an aging population and a growing number of uninsured, our health care system faces an uncertain and troubling future. Examine the critical issues influencing health care policy development and think about ways to address the dilemma of balancing cost, quality and access.     

Medicare private contracting: increasing patient choice and access?

Congress modified the Medicare program through the Balanced Budget Act of 1997 to expand patient choices for payment to physicians and certain other practitioners by allowing private contracting. This represents a shift in policy that has broad consequences for health care financing and program integrity. The effect of private contracting on quality and access to care remains unknown. Quality and access should be the most important measures of its success or failure. Out of pocket costs to seniors and vulnerable patients must also be watched closely.     

Health Care Supply Chain Design: Toward Linking the Development and Delivery of Care Globally*

This article is motivated by the gap between the growing demand and available supply of high‐quality, cost‐effective, and timely health care, a problem faced not only by developing and underdeveloped countries but also by developed countries. The significance of this problem is heightened when the economy is in recession. In an attempt to address the problem, in this article, first, we conceptualize care as a bundle of goods, services, and experiences—including diet and exercise, drugs, devices, invasive procedures, new biologics, travel and lodging, and payment and reimbursement. We then adopt a macro, end‐to‐end, supply chain–centric view of the health care sector to link the development of care with the delivery of care. This macro, supply chain–centric view sheds light on the interdependencies between key industries from the upstream to the downstream of the health care supply chain. We propose a framework, the 3A‐framework, that is founded on three constructs—affordability, access, and awareness—to inform the design of supply chain for the health care sector. We present an illustrative example of the framework toward designing the supply chain for implantable device–based care for cardiovascular diseases in developing countries. Specifically, the framework provides a lens for identifying an integrated system of continuous improvement and innovation initiatives relevant to bridging the gap between the demand and supply for high‐quality, cost‐effective, and timely care. Finally, we delineate directions of future research that are anchored in and follow from the developments documented in the article.     

New model helps find missing link between financial and clinical health care management.

U.S. health care is missing a link between the financial managers and clinical health managers of defined patient populations. Utilization and cost management try to bridge the gap by focusing on restricted access to care or tightly managed provider reimbursement to control costs. But frequently, they do not take clinical outcomes or health status into consideration. Take a look at another method based on the science of epidemiology that brings a more balanced knowledge of the clinical world to financial managers and more financial insight to clinicians.     

From managing access to managing care: the impact of primary care on health care delivery organizations.

Professional "revenge of the nerds" is currently taking place, as managed care evolves generalist physicians into new professional prominence. Primary care physicians are finding themselves at the center of health care market reform as health plans, insurers, and other financing organizations turn to them as the key to cost control. In short supply, they are prospering financially from the demand. As the source of patients, they are gaining in prestige from specialists and hospitals who once demeaned them. But these newfound roles are only the initial steps in the transformation of the primary care practitioner. The change that the generalists are experiencing is essentially managing access to care, not truly managing care itself. There are large and crucial differences between managing access to care and actually managing care. These differences are, in many ways, a higher calling for primary care practitioners as they refocus attention on patient outcomes, which will in itself result in a lower resource utilization above and beyond the crude controlling of access. What those differences are, what new roles they require, and what impact they will have on organizations that either house or contract with primary care physicians will be the focus of this article.     

Risk management in an IPA setting--Part I

Over the past several years, HMO enrollment has grown the most in independent practice association (IPA) and network models. HMOs in general have expanded as a means to control the cost of health care. Key customers, including large employers and government agencies such as the Health Care Financing Administration (HCFA), require such control. IPA and network models retain a greater sense of choice on the part of participating physicians and patients than do closed-panel group- or staff-model programs. As physician and patient choice increases, however, the HMO's control over health care diminishes. Thus, customers require HMOs to manage health care. The HMO must market, develop delivery systems, meet regulatory requirements, and make profits. It must control both the quality and the cost of health care. Doing so without the level of control found in staff-model HMOs has created unique challenges for IPA HMO managers. IPA-model HMOs adapt quality improvement programs to this lesser level of control. Staff-model HMOs and hospitals closely link quality assurance to risk management. Programs designed to improve quality will naturally also reduce the risk of providing care below standards. This relationship is less clear in IPA- and network-model HMOs, in which the HMO does not provide the care. Thus, IPA-model quality improvement programs often do not address their risk management implications. This two-part article examines the differences between staff-model and IPA-model HMOs in liability and in ability to manage risk. In the first part, the nature of the risks is described. In the next issue of the journal, the management of those risks will be discussed.     

Benchmarking: the key to influencing physicians

Managing physicians to achieve cost reductions can seem impossible, especially when managed care penetration is low. Physicians feel little pressure to change when asked merely to cut costs, especially when their boat is not rocking. But physicians will respond to benchmarking data on CPT-coded procedures that are directly comparable to their own practices. When surgeons see that others take less time to perform a procedure and/or use fewer and lower cost supplies, their competitive spirits are aroused. They become inquisitive about why this is so and then are eager to change by trying new methods and improving their techniques. Science is the key motivator, not savings. When benchmarking recommendations are implemented in a facility, better practice and substantial cost savings are the positive results.     

The ethics of health care system reform

The United States is now engaged in a momentous national debate about health care. How can we provide the best care possible while simultaneously containing cost (to promote the general economic integrity of society) and somehow maintain a semblance of a free health care marketplace. This is not just a political question; it is also a question of ethics. It is an ethical consideration because the current debate is not just about designing or promoting health care systems that can best address our concerns for costs, quality, and accessibility. It appears that at least some participants in the debate would not stop at arguing their beliefs as valid; they would make their beliefs law. Some urge the creation of the right to health care as a matter of law. There are significant differences between beliefs and rights, however, and they need to be considered carefully in the ongoing debate over the future of this country's health care delivery and financing system.     

Partnerships in health care: creating a strong value chain

The health care climate is one of stormy relations between various entities. Employers, managed care organizations, hospitals, and physicians battle over premiums, inpatient rates, fee schedules, and percent of premium dollars. Patients are angry at health plans over problems with access, choice, and quality of care. Employers dicker with managed care organizations over prices, benefits, and access. Hospitals struggle to maintain operations, as occupancy rates decline and the shift to ambulatory care continues. Physicians strive to assure their patients get quality care while they try to maintain stable incomes. Businesses, faced with similar challenges in the competitive marketplace, have formed partnerships for mutual benefit. Successful partnerships are based upon trust and the concept of "win-win." Communication, ongoing evaluation, long-term relations, and shared values are also essential. In Japan, the keiretsu contains the elements of a bonafide partnership. Examples in U.S. businesses abound. In health care, partnerships will improve quality and access. When health care purchasers and providers link together, these partnerships create a new value chain that has patients as the focal point.     

Which degree should you choose?

Which degree should physician executives pursue to enhance their careers--an MBA, MHA, MPH, MS in Administrative Medicine, JD, or other graduate degree? While options abound and the debate continues over which graduate degree physicians preparing for senior management roles in the health field should select, several variables are analyzed in this article that must be considered. Physicians need to be trained to provide leadership in the new, more market-driven environment--their education must focus more on the integration and coordination of clinical and managerial processes. New managerial competencies will be required by the paradigm shift away from simply delivering effective and efficient health services to one that emphasizes improved access, social equity, and particularly on cost containment and quality of care efforts.     

The American health system: a contentious environment in the 21st Century

In the 21st Century, the American public and its elected officials will be unable to reach any overall consensus on our nation's health policies and priorities. With greater demands for health services and fewer fiscal resources, a more contentious environment in the health industry will ensue. As the American health system in the next 100 years continues to behave with an amalgam of competitive and regulatory approaches, it will be difficult to ensure that all Americans will receive universal access, equity, comprehensive benefits, and a high quality of care. For these reasons, the health system is predicted later on to swing away from market-driven to more state-oriented regulatory strategies as the United States attempts to blend such concepts as pluralism, regionalization of resources, and enforcing cost containment.     

Mergers: enhancing human resources management

The health care industry is experiencing merger mania, but the majority of its current leadership underestimates the importance that significant differences in corporate culture and employee morale play among physicians and others in implementing such organizational objectives as enhancing access, reducing cost, and improving quality of care. The key human resources management issues are discussed that are too often overlooked and frequently sidetracked in the formation of powerful health networks now so prevalent in almost every metropolitan region. The authors conclude that in America's intensely competitive managed care environment, there are a number of critical human resources management ingredients that deal makers need to achieve from these mergers in order to ensure their perceived objectives: (1) paying far greater attention to variations in corporate culture and employee morale; (2) reducing total salary and fringe benefit costs; and, (3) concurrently recruiting and maintaining a qualified and stable workforce that focuses more decisively on clinical-fiscal concerns so as to improve quality of patient care at a lower cost.     

Cost containment in health care: a model for management research.

Cost containment is a dominant problem in the health care field, but it has not been addressed from a comprehensive management perspective. To fill this gap, we have developed an inclusive model of the cost containment process. The model has implications for management research in several areas: cost containment baselines, incentive systems, organization structures, cost/quality trade-offs, and cost containment constraints.