This is Section 1 of Leadership's Collaborating for Results report.
Return to the full report.
Bringing hospital-acquired infections down to zero or reducing total expenses by as much as 20 percent is unlikely to happen in a hospital where clinical leaders are apprehensive about sharing data or a materials manager must seek permission to work with the OR manager. As shown throughout this Leadership report, forward-looking leaders recognize that making dramatic improvements requires knocking down silo-based cultures, discouraging finger-pointing, and encouraging the spread of ideas, data, and best practices.
The collaborative cultures described in these case studies are far from free-for-alls. Formal structures, management approaches, and incentive programs-as well as implicit social codes and mores-help keep everyone on track and accountable. These organizations are configured so that individuals and units/departments are more likely to succeed when they collaborate with others.
About eight years ago, Virtua CEO Richard Miller ignited a cultural transformation across his N.J.-based health system-using words that have now become legendary among his staff: "Right now, we are average," he said. "Do we want to be average, or do we want to be a great organization?"
Virtua leaders had just completed the difficult work of integrating two merged organizations and were ready to launch a 10-year strategic plan focused on clinical excellences, facilities, IT, and finances. The health system had also begun to adopt Six Sigma methods and tools-becoming one of the first healthcare organizations to use these industrial quality improvement approaches.
"We realized Six Sigma was only going to be a tool, and it wasn't going to get us to the level we wanted," says Robert Segin, vice president and CFO. "We needed to change the culture and dynamics of the organization."
Driving toward greatness. Since 2002, Virtua has taken a series of steps to move the organization from "average" to "excellent." Virtua formed clinical alliances with a respected cancer center and children's hospital, giving its physician specialists the opportunity to adopt the most advanced medical technology. Virtua is also in the process of building an electronic health record that links Virtua hospitals to physician offices and other entities. And the health system has launched one of the most comprehensive patient navigation programs in the country (see Section 4, Coordinating the Doctor's Orders).
For the past five years, the four-hospital system has had one of the top two operating margins in New Jersey-a state in which more than half of hospitals have negative margins.
At the same time, quality is improving. Virtua has made statistically significant and sustained improvements in core measures monitored by the Centers for Medicare & Medicaid Services (CMS). The health system has also won national awards for clinical excellence in heart failure outcomes, cancer care, and surgical infection prevention.Unifying goals. Virtua has attained results like these by focusing around the united goal of providing an outstanding patient experience, say leaders. All strategic and operational decisions are made in light of Virtua's STAR initiative, a five-point symbol that sums up Virtua's mission and values.
We've simplified our directional mission and values around quality," says Ninfa Saunders, RN, MSN, PhD, executive vice president and COO for healthcare services. "We're constantly questioning, 'Why are we doing this project?' And we ensure that the project relates to one of the five points of the star."
Virtua leaders model the type of collaboration that is needed to attain all five goals. Most Fridays at 8 a.m., about 40 to 60 system and hospital leaders-clinical, administrative, and operational leaders-meet via conference call to evaluate the health system's performance on the five points of the STAR initiative. "We review financials, patient satisfaction scores, quality indicators, and other measures," says Segin.
Giving staff a toolkit. Virtua developed a management toolkit-including Six Sigma and Lean principles-that gives leaders and staff the skills and approaches they need to improve performance and attain organizational goals.
"Six Sigma is a way of life for us; it is how we do things," says Saunders. In fact, Virtua is so serious about Six Sigma that it requires all managers to be trained as Six Sigma yellow belts, which means they can apply basic Six Sigma approaches during everyday work. (The six belts are yellow, green, black, and master black.)
More complex improvement projects are handled by staff-nurses, physical therapists, accountants, pharmacists, and others-who are trained as Six Sigma black belts and work full-time on process improvements. To foster multidisciplinary thinking, those individuals are intentionally assigned to units outside their professional credentials, and they rotate into new assignments every three years. For example, a nurse who is trained as a black belt will work in any area except nursing.
Expecting ROI. All improvement projects are expected to have a 3:1 ROI, meaning that either revenue increases or expense reductions outstrip the cost of the project by a factor of three. Since the implementation of Six Sigma and other tools into its daily operations, Virtua has realized a total value of $28 million.
One of the biggest ROIs has come from appropriately billing managed care payers for implantable medical devices used in joint replacements and other surgeries, says Segin. "We were able to implement a process improvement that allows us to capture about $5 million in lost billing on an annual basis."
Another win: The rate of insurance claim denials for administrative reasons has fallen from nearly 8 percent to below 4 percent.
Virtua is now focusing on reducing the 30-day readmission rate and average length of stay for patients. Success in these efforts will position Virtua to thrive when payers curtail payment for avoidable readmissions, as expected.
The system's 30-day readmission rate is currently less than 15 percent, which is considerably below the New Jersey average of more than 19 percent. "In spite of that, we think we could do better," says Saunders.
CHRISTUS Health's cultural narrative was forged in 1866 by a small, but tough, group of French nuns. After surviving a rough sea voyage complete with a hurricane, the nuns arrived in Texas on a mission: to extend the healing ministry of Jesus Christ. In the span of just three years, the nuns opened two hospitals- one in Galveston and another 280 miles away in San Antonio-and they nursed the two communities through yellow fever and cholera epidemics.
Given the miles of rough terrain between them, the Galveston and San Antonio hospitals became two independent health systems. A century plus later, in 1999, the two systems rejoined forces. The united entities became CHRISTUS Health, which includes more than 50 hospitals and long-term care facilities, 175 clinics and outpatient centers, and dozens of other facilities in America and Mexico.
CHRISTUS Health's first 11 years have been marked by a commitment to excellence. Systemwide performance on CMS core measures reflects the health system's dedication to clinical quality. For instance, performance on a subset of congestive heart failure measures improved from 55 percent to 92.9 percent between 2004 and 2009. In addition, adverse drug events have been reduced by half-from 2.7 percent in FY07 to 1.11 percent by year-end 2009.
Improving on history. The leaders of the newly formed CHRISTUS Health astutely recognized-and harnessed-the motivating power of the founding nun's original quest. CEO Tom Royer, MD, pinpoints this in his blog, Wireside Chat with Dr. Tom: "Because the two organizations that came together to form CHRISTUS were over 133 years old when CHRISTUS was formed, we needed to make sure we reviewed their history and carried forth those elements that were an important part of their culture. As a result of this review, the mission of these two organizations remains the mission of CHRISTUS Health: to extend the healing ministry of Jesus Christ."
A few targeted improvements were made to the cultural foundations. For instance, "excellence" was added to the health system's list of core values to further rally leaders and staff. In addition, as part of a balanced scorecard initiative, all CHRISTUS units are continually measured in four key areas: clinical quality, service quality, business literacy, and community value.
Beyond that, Royer says, the CHRISTUS brand also stands for a commitment to future planning, transparency of clinical and financial performance, and a balance among local, regional, and system priorities.
Hiring the right leaders. In designing the new organization, Royer sought to strike a balance between autonomy that respects the local nature of health care and what he calls "systemness," or the need to work as a team to achieve system-level goals and objectives. One way he accomplished this: Choosing leaders who value collaboration as much as they value independence.
When CHRISTUS Health evaluates candidates for leadership positions, one of the "must-have" attributes is a high degree of comfort with collaboration. "We have a commitment to localness, a commitment to uniqueness within our regional and business units. Just as important, we have a commitment to 'CHRISTUSness,' or achieving system goals," he says. "The leaders have to understand this, first of all. Second, they have to embrace it. Third, they have to be able to implement it. And if they are uncomfortable with this approach, then they have to decide that perhaps this isn't the right organization in which to continue their careers."
CHRISTUS requires leaders to share facility-specific quality and patient satisfaction scores on the system's web site. In addition, incentives help ensure that leaders and staff are as concerned about their colleagues' success as they are their own.
"In some organizations, there is a competitiveness that causes people to keep things to themselves so they look more successful," says Royer. "Here, our salaries, our bonuses- everything really-has a system component to it. This incentivizes our leaders and staff to share their best ideas with everyone else."
Making long-term plans. Last year, the system completed an intensive planning process that will steer CHRISTUS through 2020. "Because of the trends we're seeing in our industry and the culture worldwide, we have been realigning our portfolio from its heavy focus on acute care to include one-third nonacute care and one-third international operations," says Royer.
The long-term plan identifies:
The long-term planning process provides another example of CHRISTUS' collaborative nature. The strategic drivers, directions, and enablers are conceived at the top level of the health system, but every business unit must consider these guidelines when developing three-year rolling plans.
"We can't plan in isolation," says Royer, who has been thrice listed on Modern Healthcare's list of most powerful physician executives. "We must use an integrated planning process so all units are working toward the same goals."
Spreading good ideas. Leaders and staff are encouraged to share and celebrate innovative ideas. The Touchstone award was designed to recognizebest practices in each quadrant of the balanced scorecard. To be eligible for the Touchstone, the nominated practice must be published on CHRISTUS' intranet so any system leader can learn from it.
Another award-the Spirit Exchange award-is given to a CHRISTUS region that "steals" a best practice from another region and successfully implements it. The award honors not only the borrowing region, but also the region from which the practice was appropriated.
For example, when one region won a Touchstone award for establishing a school-based health center, other regions took note. The clinic provides primary and preventive physical and mental health services at public school sites. Children with asthma and other chronic diseases can be closely monitored at school, keeping children out of the emergency department. Immunization rates have also improved.
The process for establishing a school-based center was widely shared, and CHRISTUS now operates 35 such clinics.
Spreading success in this fashion has limitless potential for the huge CHRISTUS system, Royer says. "There are some places in our health system where we have already reached excellence in every one of our measures," he says.
For example, CHRISTUS St. John Hospital in Nassau Bay, Texas, is a top revenue-cycle performer, thanks to process improvements that led to a significant reduction in insurance claim denials and high patient satisfaction scores for the admitting department.
"Now we're asking, 'How can we reach excellence in every place in our system and on every one of our performance measures?" says Royer. "That's my goal, and the goal of the entire CHRISTUS family."
In frontier LaCrosse, Wisc., people often said that life consisted of birth, christening, an operation by Adolf Gundersen, MD, and, hopefully much later, death.
Gundersen's European medical training quickly placed him as the city's premiere physician. Most of the other "medical doctors" in the area had received their training from diploma mills. Gundersen founded a physician-led medical clinic, which went on to merge with the local teaching hospital in the late 1990s, becoming the nationally renowned Gundersen Lutheran Health System.
Attracting patients and talented employees. Given the prominence of the Gundersen name and reputation, the leaders of the newly formed health system chose to make the new entity a physician-led organization. Gundersen Lutheran is led by an all-physician board of governors, a physician CEO, a chief medical officer, three physician medical vice presidents, 60 physician department and section chairs, and 10 medical directors who cover clinics.
All of these physician leaders continue to practice medicine. As such, they must rely on a cadre of nonphysician administrative leaders and managers-including senior vice presidents, vice presidents, chiefs, and directors-to help them lead and manage the organization.
"We're really committed to a strong medical and administrative partnership, working together to create the kind of environment that we want for our patients and to attract and retain the most talented employees and physicians," says Mary Ellen McCartney, the system's chief learning officer. She is responsible for the leadership development strategy that supports that culture.
The collaborative partnership is working well to date. The health system has won numerous quality awards, including HealthGrade's 2010 Distinguished Hospital Award for Clinical Excellence.™
Formalizing collaboration.The well-working partnership did not just "happen." A number of steps have been taken to encourage teamwork and trust between physician and administrative leaders.
One example: Expected behaviors for both parties are summarized in a formal "compact." One medical staff responsibility on the compact is to: "Work in collaboration with other physicians, support staff, and management across the system in both service and patient care improvements." A correlating responsibility for administrative leaders is to: "Acknowledge and reward superior performance that enhances patient care and improves Gundersen Lutheran Health System."
"These are really cultural transformation tools that determine where are we going, what you can expect as a physician in our organization, and what our organization expects from you," says McCartney.
The physician compact emerged from discussions about two trends, says Marilu Bintz, MD, a medical vice president. For one thing, the organization was asking its physicians to work more collaboratively so that patient care was better coordinated. For another, some physicians wanted their role in the organization to be more clearly articulated.
The final document helps drive organizational performance. For example, one of its tenets is that physicians will, "Embrace innovation to continuously improve patient care, service, and organizational efficiency." Because physicians agree to that concept, administrative leaders had their support when Gundersen Lutheran reorganized several departments to create a vascular institute.
"We had vascular surgeons doing their thing, interventional radiologists doing their thing, and cardiologists doing their thing," says Bintz. "Because of the compact and the principles that it enforces, we have been able to bring those subspecialties together to provide the best evidence-based care in a coordinated fashion that delivers the highest value possible."
More than 95 percent of Gundersen Lutheran's 450 physicians are employees. But Bintz rejects the idea that Gundersen Lutheran's high rate of physician employment is essential for a close working relationship between physicians and administrators. She believes that Gundersen Lutheran's success can translate to independent physicians.
"The issue is not physician employment. The issue is physician buy-in," she says. "You can have employed physicians, but if they don't buy into the relationship, then their employment is pretty irrelevant."
Partnering for management. Every physician who has management responsibilities at Gundersen Lutheran (at a vice president or department level) is paired with an administrative partner. For example, Bintz is paired with Deb Rislow, RN, an operational vice president who also serves as chief information officer. Together Bintz and Rislow are responsible for internal medicine and all medical subspecialities, as well as Gundersen Lutheran's cancer center, breast center, radiology, and pathology units.
"She and I address the financial issues, the human resource issues, strategic planning, quality-and everything," says Bintz. "Together, we're able to make decisions with the patient at the center, and not the checkbook at the center."
Bintz believes these physician/administrative partnerships are key to the system's ability to bend the healthcare cost trajectory. "When you can get the medical staff and the administration to look out over the healthcare landscape and future in a similar way, you will drive down the cost of care because you will find ways to be efficient and you will deliver value without compromising the quality of care," says Bintz.
Central to a collaborative culture are leaders who are comfortable crossing clinical, business, and operational borders. See Section 2, Learning Each Other's Language, for more. Or access the entire Leadership report, Collaborating for Results.
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Deloitte: Leveraging IT for Value-Based Care Transformation
Apex: Cultivating Patient Payment while Elevating the Patient Experience
HealthPort: Ensuring Compliant Exchange of Protected Health Information
Community Hospital Corporation: Supporting Community Hospitals
Cerner: Connecting Clinical and Financial Data
Aidin: Better Manage Your Post-Acute Provider Network and Improve Patient Outcomes
GE Healthcare: Delivering Sustainable Cost Reduction
Deloitte: Solutions for Healthcare Transformation