Healthcare Value

John Byrnes

Highly effective, well-organized quality programs can greatly increase the value healthcare organizations deliver to their communities.

The ability to improve quality while reducing costs is the ultimate win-win scenario for healthcare providers. However, ineffective, under-resourced, and poorly led quality programs will be the Achilles' heel of organizations in the future.

During the past year, I visited more than a dozen hospitals whose quality programs were failing. All were expected to deliver on the value proposition-better quality, better experience, and lower costs. But after several years, all were struggling.

The lessons learned from these organizations are valuable. Rather than tell us what to do, they tell us what not to do, and that saves us valuable time engineering our own programs. Four lessons illustrate the pitfalls hospitals should avoid.

Lesson 1: Don't Alienate the Physicians

Through the power of their pen and the medical decisions they make, physicians control 80 percent of our quality and the resources used in our hospitals. Don't make them your enemy.

Several organizations had poor relationships with their physicians. The physicians didn't trust hospital administrators or nursing leaders. In both organizations, leaders had broken promises to the physicians more often than they had kept them. In addition, there was a palpable antiphysician sentiment in the two organizations. The physicians could feel it, and they could see it. The administrators didn't try to hide it. Antiphysician rhetoric was underpinning many conversations in executive meetings-even in board meetings.

As a result, physician leadership was missing from these organizations' quality and utilization management programs. The physicians were completely disengaged. The results:

  • No progress in reducing serious medical errors after two years of an administration-led program
  • Core measure rates below the 25th percentile
  • Partial loss of the withhold on their CMS value-based purchasing program
  • Poor physician satisfaction rates
  • High cost of care compared with their benchmark groups

Time and again, this rule of thumb prevails: Mediocre physician relationships generate spotty value. Poor physician relationships drive low value. Great physician relationships drive superb value.

Administrators and nursing leaders who hold antiphysician views should not be tolerated; we cannot afford administrators who make physicians their enemies or nursing leaders who dislike physicians. To deliver a good value proposition to our communities, we need just the opposite-administrators and nursing leaders who will embrace our physicians as partners on the journey toward better care and higher value.

Lesson 2: Provide Support and Direction

Unfocused and unsupported medical directors will cost your organization more than they will save.

All the organizations I visited had a sufficient number of paid medical directors. The majority of the medical directors set aside 0.25 FTE of their time to support hospitals' quality and cost-reduction initiatives. However, one organization's medical directors reported to the chief nursing executive, who had 30 such direct reports. The result was little effective oversight, no mentoring or coaching, and no results.

In another organization, the medical directors reported to a chief medical officer (CMO), who did not continue the practices of her predecessor. The predecessor had provided explicit job descriptions for each medical director, had established yearly projects in partnership with each medical director, and had set year-end targets for the most important outcome measures. He also had conducted year-end reviews and formal performance evaluations for each physician and had aligned the medical directors' goals with the goals of the organization's nursing leaders. With this structure in place, the organization quickly rose in the national ratings. When the structure was no longer supported, its ratings plummeted.

Medical directors can drive tens of thousands of dollars in cost savings each year through well-targeted improvement activities. Many physician leaders at Spectrum Health have multimillion-dollar opportunities. With proper support and direction, they deliver on the value proposition.

Lesson 3: Avoid Death by Too Many Quality Projects

Another organization was particularly proud of the number of quality and safety projects it had under way. Each nursing unit and each department was expected to implement two to three projects every year. Generated at the front lines, the projects were unit-specific. On the surface, this approach seemed to make sense, but in reality, it failed for several reasons:

  • So many projects were initiated that the quality department could not support the volume.
  • Because of their narrow, unit-specific focus, the projects were limited to having only a small, often negligible impact on the organization.
  • The myopic view of a unit focus does not encourage multi-unit or organizationwide projects.

The value proposition comes to life when we strategically target improvement for large numbers of patients. For instance, improvement of percutaneous coronary intervention in a typical tertiary care center affects thousands of patients-3,300 patients, in fact, at Spectrum Health. Or reengineering the medication administration process from order entry to administration affects every inpatient. Strategically focused, large-scale projects such as these create the impact needed in today's environment.

Lesson 4: Avoid Death by a Minimalist Agenda

Just as dangerous as death by too many quality projects is death by just the opposite-what I call the minimalist agenda. All too often, I hear, "We can do only a handful of projects," or "We can tackle only what's required by CMS." This is simply not true. Let me give you an example of how to successfully broaden your quality agenda. At Spectrum Health, we created an opportunity analysis for a 900-bed tertiary care hospital. The analysis showed the complications that occurred frequently in the institution. Using industry standard co

st studies, we calculated the savings potential if the complications were eliminated-an approach similar to what occurs with the bundled payment pilots across the country. For roughly 35 complications, the savings opportunity was more than $40 million.

In any rational organization, you would hear, "Let's go get them." But in many underperforming organizations, the excuses are endless for "why we can't go after the whole $40 million." Don't let those voices win. Any well-organized quality department, led by quality experts, in partnership with their medical directors and nursing colleagues, can tackle that entire list in one year. If we collectively eliminated all preventable complications in our organizations, the savings nationwide would be staggering and the prevention of human suffering immense.

Delivering Value Successfully

If we avoid making the same mistakes the struggling organizations made, we will have a much better chance of success as we engineer our systems to deliver on the value proposition.


John Byrnes, MD, is senior vice president and chief quality officer, Spectrum Health System, Grand Rapids, Mich.; clinical associate professor, MSU College of Human Medicine, Grand Rapids; and a member of HFMA's Western Michigan Chapter.

Publication Date: Wednesday, August 01, 2012

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