That is, in essence, what my week at the AHA Leadership Forum in San Francisco was all about. We all know that there’s a tremendous wave coming in healthcare. The recurring theme was actually “the second wave” representing the shift from pay-for-service to the new models of healthcare reimbursement that are on the horizon. And the conference focused on determining what the industry will look like in the future.
As much as we’ve discussed the changes, much of that talk has either been very conceptual or very tactical – in essence missing the forest for the trees. The various legislative efforts that have gotten this ball rolling (ARRA, ACA) are really applying leverage at the edges of the healthcare system. But they don’t do a good job describing what the core of the system will really look like when it’s all said and done, let alone what will happen as we work through the processes of transformation.
While it may add to our collective discomfort, this is fundamentally a good thing. For all the complaints of politicians trying to change a healthcare system that they do not fully understand, we should be happy that they haven’t attempted to dictate the details. They’ve set out meaningful goals specifically around the reimbursement model and then stepped out of the way to allow the healthcare system work out the details.
It’s clear that we don’t really know the details just yet – at least not all of the details. We do seem to understand where enough major challenges lie to keep us occupied for a while, however.
The AHA Leadership Forum split its time between addressing the bumps that will lie in the road ahead and big-picture strategic thinking around how to prepare ourselves and our organizations for the challenges we have yet to recognize. The list of speakers was fantastic – including Jim Collins, Author of Built To Last and Good To Great, Former Secretary of State Condoleezza Rice, Harvard business professor and author of the Innovator’s Dilemma and the Innovator’s Prescription Clayton Christiansen, Maureen Bisognano, the President and CEO of the Institute for Healthcare Improvement (IHI), and political analyst George F. Will along with dozens of faculty from health systems and their consulting and vendor partners.
A few key take-aways from the conference:
- Healthcare transformation requires a lot of things to go well in order to be successful. But over and over again, attendees said that the EHR is the hardest part. I must say that I’m not sure I agree. I do think that the software requires the organization to do a lot of really hard things, many of which they should have done a long time ago – standard protocols for treating patients with a particular condition, for example, or effectively sharing patient data both inside and outside the organization. The price tag on these tools (often running into the hundreds of millions of dollars) is the reason that they are viewing these pieces as the most difficult. The hard part isn’t the tools; it’s the change that comes with implementing those tools.
- The other pillar of change that’s well underway is the relationships between physicians and hospitals or health systems. Lots of people are talking about this challenge as “physician alignment” but many don’t really understand what that’s going to look like or just how big the task is. The move to physician employment may help, but simply giving a physician a regular paycheck doesn’t fundamentally solve the problem. Many physicians are on the verge of burnout, feeling disaffected and underappreciated. The problem of alignment is one of morale boosting, engagement, embracing best practices, and creating systems for consistent, high quality care delivery. Seeing an exodus of large numbers of providers from the field would cripple our ability to deal with the changes on the horizon.
- For that matter, we need to do some “employee alignment” as well. We are, appropriately, pushing towards a more patient-centered care environment. But we can’t do that without happy, energetic, committed employees throughout our facilities. These people used to love to do healthcare; now we need to help them love to do healthcare again.
- Expect a period of massive reorganization in healthcare. We haven’t seen significant operational re-engineering in healthcare in the way that other industries have experienced it over the years. That set of changes is coming now. The current leadership structures wouldn’t work for what we’re trying to accomplish. If they did, we wouldn’t have this problem.
- All of this requires great leadership at the industry level and at the individual organizations that will be making these changes real over the next several years. Those leaders will need to do four things: they’ll need the discipline to put a plan in place and march forward towards their goals, they’ll need the ability to adapt themselves and their organizations to changes that will come and are unforeseen, they’ll need the ambition to make their organizations great, and they’ll need the humility to hear out the messages that don’t always align with their outlook.
In other words, it’s going to be a wild ride in healthcare for the next several years. My own take on the changes that are coming boils down to the difference between a strategic retreat and simply running away. I see a lot of organizations today that are running away – cutting budgets arbitrarily, simply trying to do the same things in the same ways with less. Running away, in military terms, is a panicked maneuver done without thought and typically without a lot of success. Strategic retreat accomplishes the same thing in a thoughtful, systematic way with a focus on containing the threats surrounding you to facilitate the transition to a safer place.
The healthcare system’s transformation won’t be accomplished simply by doing more with less. It will only happen when we do things differently. The endgame is, at least superficially, the same but it allows organizations to preserve enough of their capabilities to face the next set of challenges that lie ahead.