By Jeff Goldsmith
In the ten months since the passage of health reform, health care managers, particularly those in hospitals and health systems, have struggled to make sense of an onslaught of change in Medicare policy. The response has been depressing: an accelerating wave of merger and acquisition activity, both horizontal hospital mergers and an accelerating concentration of ownership of physician practices in hospital hands. While this activity anticipates an era of “accountable care”, the care and feeding of these complex new enterprises will deprive managements and physician leaders of the time and bandwidth to actually transform health care delivery itself.
The best antidote to the magical thinking that achieving a certain asset structure is the key to transformation is reading Charles Kenney’s new book about the Virginia Mason Health System’s ten year experience with adapting the Toyota Production system to health services (Transforming Health Care: Virginia Mason Medical Center’s Pursuit of the Perfect Patient Experience, CRC Press, 2010 with an introduction by Don Berwick). By the year 2000, Virginia Mason had achieved the end state of “integrated care” that the current wave of hospital M+A activity seeks to emulate: a sophisticated 300-person multi-specialty medical group with its own hospital and a regional network of satellite clinics spread across metropolitan Seattle.
Yet Virginia Mason (VM) was losing money and, in the view of its leadership, delivering a suboptimal patient care experience. Under the leadership of CEO Dr. Gary Kaplan, Virginia Mason management and clinical leaders undertook to apply Toyota’s Lean Production system to Virginia Mason’s operations. The result was a cultural revolution in an organization that already had a national reputation, replacing a system of “physician-centered” care with a self-improving patient-centered care system. At the heart of this system was a “factory-floor” process of “rapid process improvement” initiated by workers in direct patient contact — an adaptation of Toyota’s kaizen process to health services.
This rapid improvement process involved empirical analysis of the problem and collaborative redesign by the work force itself (physicians, nurses and support personnel) to eliminate waste and improve the patient care experience. Different chapters of the book show how this was adapted to design a new cancer center, reorganize VM’s money-losing primary care operations, reorganize care for lower back pain to respond to health insurers’ and business’ cost-containment pressure, recreate its ambulatory surgery program, and, eventually, design a long-delayed replacement hospital.
What strikes you as you work your way through Kenney’s case examples is how hard clinical transformation is at the sharp point of direct patient contact. It required VM and its workforce to fundamentally rethink and renovate long established workflows, habits and routines. But most significantly, it involved redistributing power away from VM’s “owners”, the physicians, and enabling even the most junior nurse or aide on a patient unit to “stop the production line” by calling a Patient Safety Alert, triggering an immediate collaborative analysis and correction of defects.
In a visit to VM in 2008 (my fifth in thirty years), I… (Read complete blog post at Health Affairs, here).
Jeff Goldsmith (email@example.com) is president of Health Futures Inc. He is also the author of a book released this year titled “The Long Baby Boom: An Optimistic Vision for a Graying Generation.”