Ideas to Read and Pass Along

Kevin & Jackie Freiberg

Why Values Matter in Healthcare

What can we learn from the healthcare conundrum?
health crossWe recently did a keynote for Blue Cross Blue Shield. Through our research and preparation for the event, we were encouraged to read a very interesting article, The Cost Conundrum, in The New Yorker, by Dr. Atul Gawande. For those of you who want the CliffsNotes/SparkNotes version, read on.

Multiple studies of comparable high and low-cost healthcare markets (all based on Medicare’s per-enrollee cost) reveal some remarkable findings. Patients in high-cost areas (where more money is spent per enrollee) with state-of-the-art technologies, treatments, and quality care are no better off than those in low-cost per-enrollee markets.

Ironically, the high-cost healthcare markets seem to have lower quality rankings. The real kicker is this; patients in high-cost markets get more tests, procedures, specialist visits, and hospital admissions, but they’re not healthier (thus the lower quality rankings). In fact, the patients in high-cost markets seem to be worse off than those in low-cost markets—in terms of survival, function, and patient care satisfaction. In contrast, Dr. Gawande highlights the Mayo Clinic in Rochester, plus a few others that are recognized as having the highest quality patient care scores, yet all operate in low-cost markets.

In summary, The Cost Conundrum is just one guy’s qualitative analysis of two Texas communities with similar demographics, yet their healthcare expenses fall on opposite ends of the cost continuum. In the end, were we surprised by the differing characteristics of the low and high-cost healthcare markets? Nope, they’re identical to the drivers that differentiate poorly performing organizations from highly successful, enduring brands.

So what are the differences in these low and high-cost healthcare markets? We think the differences have a lot to do with the core values driving decisions and behavior, plus a lack of collaboration and accountability.

High-Cost Market Drivers/Low Performing Communities

Higher Medicare costs per enrollee than the national average

Vested Interests—Many physicians are either fully or partially invested in hospitals, imaging and surgery centers, and other private healthcare facilities. When physicians send patients to facilities and businesses that they are invested in, they also share in the profits (over and above their fees). Perhaps vested interests are becoming a conflict of interests?
Are there any conflicts of interest you need to set straight?

Warped Accountability—In high-cost markets, it’s tough to know who is in charge. Is it the administration, the agencies, the physicians, the private business owners, or the patients? What is the ultimate goal, and what should all the players in the system be accountable to—patient wellness, patient satisfaction, protection against malpractice, or is it personal gain and increasing revenues?
In what ways can you better align and increase accountability to achieve your goals?

Silos and Tribes—There’s not much practice of reaching across functional boundaries to collaborate on patient care. Why? Perhaps it’s because you can’t collect on collaboration. Perhaps it’s because collaboration takes too long. What we do know for sure is this; Lone Ranger decisions aren’t as smart or as effective as the collective minds of peers and specialists.
Are you inclined to trust your silo and operate in isolation? Who can you begin reaching out to for insights and ideas?

Pervasive Apathy—Martin Luther King Jr. said it best, “Our lives begin to end the day we become silent about things that matter.” An alarming silence pervades. Even those who know the system is broken aren’t standing up for what is right or standing against what is wrong. Is the frightening silence being fueled by fear, greed, a lack of training or misguided business decisions, and opportunistic financial goals? Dr. Gawande’s article is but one attempt to break the silence.
What can you do to break an alarming silence in your industry?

WIIFM Culture—What’s-in-it-for-me, a profit-first, patients-second mentality seems to pervade decision making in high-cost markets. The culture seems to value revenue, convenience, and personal protection over prevention and patient quality rankings. Service serves the interest of doctors and healthcare organizations.
What or who is your culture designed to serve and protect? How are you measuring or tracking your success?

Wasteful Spending—CYA! It appears there is an overuse of specialists, tests, services, and surgeries driving the costs up in these high-cost markets. Fear and self-protection creates a toxic environment that lowers the chance of innovation, accountability, and collaboration—all drivers of quality.
Are people in your company afraid to fail and more inclined to cover their heinies? What are you doing to eliminate fear and increase quality?

Blind to the Bigger Picture—Sadly, surprisingly, and unfortunately, there were a number of healthcare leaders and executives who seemed unaware of the data and were blind to the high, collective healthcare costs in their community.
How aware are you and your colleagues to the impact your business has on the industry, the community, your customers, and the environment?

In the end, Dr. Gawande’s study shows the consequential impact of exaggerated spending—the lowest quality and least efficient patient care has the highest cost per enrollee in the nation.

What is to become of this country, if healthcare and other industries continue to subjugate the service of others to the service of self?

What can we learn from this case study? What can we do to build high-performing cultures regardless of the industry we’re in? Here are some lessons from the higher performing, low-cost communities:

Low-Cost Market Drivers/High-performing Communities

Lower Medicare costs per enrollee than the national average

Gutsy Leadership—People at all levels of the community are willing to serve the cause. Gutsy leaders are unafraid to stand against the dominant culture of incentives—“business-as-usual.”

Leaders are Value Shapers—Decision-makers live their values (patient care priority) out-loud, in every area, so others can see and follow.

Accountability—Everyone at and across all levels takes ownership for their choices and actions. Standards, checks, and balances are in place so that everyone keeps each other on track and committed to the goal in mind. Quality and care are owned and embraced by everyone.

Collaborative Commitment—There’s a collective effort to work across teams, departments, and functions to deliver better patient/customer care. Gutsy leaders work proactively to root out any obstacles to quality, cost reduction, and other service goals.

Service Over Self Interest—Patient/customer care first! Remove financial barriers by paying physicians a salary so incentives are not tied to patient care and priorities are not conflicted.

Yes, Fast Culture—Work on creating a reputation where the best people can do their best work to give the best patient/customer care. A commitment to bureaucracy and red tape must be replaced with a sense of urgency for quality and care. Say YES fast to get things done and patients/customers served.

Risk More to Gain More—Establish innovative practices for better patient/customer care and service. Always look for and implement better ways to create the highest quality patient/customer care.

Our purpose is to remind us all that values, culture, and service ultimately determine the performance, effectiveness, and success of every organization.

Dr. Gawande ends his article with…

Will changing the person who writes the check really reform healthcare? When it comes to making care better and cheaper, changing who pays the doctor will make no more difference than changing who pays the electrician. The lesson of the high-quality, low-cost communities is that someone has to be accountable for the totality of care.

We concur, because world-class, enduring brands also have established cultures where everyone is accountable for the practices, goals, and success of the organization.