Irrespective of the healthcare delivery mechanisms that have endured to this day, consumers expect value in their healthcare, which implies high quality, reasonable cost, and an excellent patient experience. Physicians will need to not only participate in effecting this change, but also lead it, or risk losing credibility as a patient's most critical healthcare advocate. In anticipation of these needs, Lancaster General Health (LG Health) embarked on a unique, decade-long physician leadership development journey that culminated in the graduation of 21 physicians and administrators from St. Joseph's Haub School of Business Executive MBA program. Collectively, the group constitutes a priceless network of professionals who are helping to lead healthcare change in their community.
TopIntroduction
Whether healthcare has a black swan looming, or some lesser disrupter on the horizon, one thing is certain: spending on healthcare has reached epic proportions (Taleb, 2010). Three trillion dollars, or 20% of the nation’s gross domestic product (GDP), is placing a severe drag on the United States (U.S.) economy. What is uncertain is how long this level of spending can be sustained.
Consumers, who convert to patients for their brief office visits or hospital stays, pay an average of $18,764 for an employee-sponsored family plan (Kaiser Family Foundation, 2017). Considering that in 2016, the median household income for an American family was $59,039, it is no wonder that consumers feel that healthcare is priced outside of a reasonable range - like the US economy, over 30% of most families’ income is simply too much. Similarly, businesses cannot afford to keep up with the rapid rise in healthcare pricing and disrupters, such as the collaboration between Berkshire Hathaway, Amazon and J. P. Morgan Chase is a good example of a major healthcare stakeholder deciding that the growth trajectory in healthcare spending must stop (Wingfield, Thomas, & Abelson, 2018).
Exacerbating the frustration with the costs of this system is the fact that outcomes of these expenses are not particularly impressive. According to the Peter G. Peterson Foundation, 30% of US healthcare spending goes to wasteful, ineffective, or useless services. In a study conducted by the Organisation for Economic Co-operation and Development (OECD), cited by The Commonwealth Fund in U.S Healthcare from a Global Perspective, the United States’ per capita spending was highest, while life expectancy was the lowest amongst 13 OECD countries including Australia, Canada, Denmark, France, Germany, United Kingdom, and Japan.
Considering this, it is no wonder that “value” has become the buzzword in healthcare that is, according to Griffith (1998), “price and quality delivered to the customer”. This means that “it consists of good outcomes, easy access and acceptable service” (Griffith, 1998, p. 3) and, one could add, at an affordable price. The Institute for Healthcare Improvement explains the need to move in this direction through the “Triple Aim” which focuses on:
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Improving the patient experience of care (including quality and satisfaction);
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Improving the health of populations; and
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Reducing the per capita cost of health care.
So, why are we at this juncture? The symptoms we are seeing, of high costs, with less than desirable outcomes, are the results of a system that was not designed to keep people well. Rather, healthcare in the US has focused on caring for people when they are sick. While not an intrinsically “bad” way to look at resolving a problem, a system that is only focused on problem resolution is incomplete. A more complete approach would be to consider problem mitigation, and resolution assessment and improvement, pieces that are often forgotten or ignored.
In healthcare, focusing on caring for patients when they are ill has resulted in a one-dimensional system. Incentives, systems and programs have all aligned to focus on getting sick patients “well”, rather than keeping “well” patients from getting sick. Likewise, there is no feedback mechanism to assess whether the processes and steps we are taking to get people “well” are working. Put simply, the system has focused on interventional rather than preventative care. This is reflected in the payment mechanisms of current healthcare, with little or no recognition for the time of physicians and their staff to proactively reach out to patients for annual health checks, cancer screenings, etc., to prevent their needing future intensive care. No compensation is offered for building relationships that might actually mitigate interventional healthcare needs. Consequently, these perverse incentives have resulted in expensive inpatient services and interventions.