The American health-care system is vastly more expensive than any other country’s, but our results are not vastly better.
The Affordable Care Act attempted to begin untangling the factors that contribute to this untenable situation. While it certainly has improved things like access to care and coverage of pre-existing conditions, the cost of care is still so high that more government intervention routinely pops up as the only remaining solution. Think “BernieCare” or a public health insurance option.
The health-care conundrum is too big to point at any single contributor, but hospitals routinely fight perceptions, if not outright evidence, of charging too much — especially to the privately insured.
Colorado hospitals charge more, have higher costs and still report higher profit margins than any other state, according to a financial analysis of federal data presented last week to the Colorado Business Group on Health.
Against this backdrop, St. Mary’s Medical Center is sharing the initial results of a long-term and ongoing process to change how it operates. Instead of issuing a top-down management directive to shave costs, the hospital is asking frontline doctors and staff how they can operate more efficiently with the savings getting passed to consumers.
The Sentinel’s Charles Ashby details the “Clinical Leadership and Care Redesign” initiative in today’s paper. It’s a pilot project within the SCL Health family of hospitals.
The care redesign concept isn’t new. Intermountain Healthcare, a network of hospitals and clinics in Utah and Idaho, has spent 25 years applying the insights of W. Edward Deming’s process management theory — which says that the best way to reduce costs is to improve quality — to health care delivery.
With that trail blazed, St. Mary’s hopes it can complete a meaningful transformation in three to five years, Chief Medical Officer Andrew Jones told the editorial board on Monday.
The hospital has enlisted the consulting services of Dr. Richard Bohmer, one of the first directors of quality at Mass General (Harvard’s teaching hospital) and a faculty member of Harvard’s Business School.
Bohmer’s experience is that hospitals have very different types of care processes, each requiring different management systems, resources, tools and personnel. Most hospitals aren’t set up for that kind of multifunctionality, leading to a misalignment between patients’ health problems and processes and treatments applied to solve them.
The way to begin improving care — and reducing costs — is for physicians and frontline staff to deconstruct what they do and ask if those processes meet four goals: lower costs, provide better quality service, improve access to care and enhance the work experience for providers, Dr. Jones said.
That last item is important because eliminating “headaches” for staff correlates highly with greater efficiency, which produces cost savings, but also addresses the growing problem of physician burnout.
So far, three clinical physicians representing the Spine Center, oncology/hematology and critical care have led their staffs through the process and have reported difference-making results, most notably in the realm of removing “irritations” for both patients and staff.
“None of these things are in and of themselves transformative,” said St. Mary’s CEO Bryan Johnson. “But what I’ve found in transformative organizations is that small changes consistently applied over time is what transforms them.”
Johnson said the care redesign project is the fulfillment of a “promise to our community to change the way we operate internally,” and a giant stride toward value-based care.
“Nobody cares if the hospital can do things better if it’s more expensive to the end user,” he added.
Improving care, reducing waste and lowering costs have been consistent themes since Johnson became president of St. Mary’s nearly 18 months ago. He pointed to the hospital’s decision to reduce prices for imaging services by 70% last year.
The pandemic interrupted a more aggressive timeline for addressing cost savings through care redesign. But it remains a priority, Johnson said.
“Where the country is fed up with health care, generally, is the fact that we’ve used the pricing model to maintaining profitability and not investing in our efficiency or cost structure.”
There’s certainly a political angle here. The renewed focus on hospital profits is expected to factor into a debate in the state Legislature over adding a “public option” insurance plan. Johnson can point to the care redesign as proof that his hospital system is trying to do something about costs. Perhaps that helps the hospital lobby buy some time before lawmakers take drastic action.
But the bottom line for patients in the areas served by St. Mary’s is that the hospital is taking steps in the right direction. Borrowing a phrase from Johnson, nobody cares what St. Mary’s motivation is. People just want more affordable care.