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The Value Proposition For Health Care: A Challenge For Physician Leadership

In health care there is nothing more complex than the simple.

In a recent New England Journal of Medicine article, What is Value in Health Care?,  Michael Porter, a Harvard trained PhD in business economics, makes a compelling case for defining, measuring and rewarding value in health care. By shifting our focus on value, simply defined as quality divided by cost, we can lower costs and improve quality.

The elegantly written article shows that value is what drives consumers.

Not quality. Most of us wouldn't shell out $100,000 for a  new automobile, regardless of its quality.

Not cost. We wouldn't buy a new car for $5,000 if we were convinced it would spend most of its time in the repair shop. Honda and Toyota have been kicking Detroit's butt because of value. Most of us see Honda or Toyota automobiles as providing high quality and low cost. It's time we move health care in the direction of value.

The value proposition is easy to understand, but its implementation will be complex.

There are three complexity challenges that will require effective physician leadership:  

  1. Defining and measuring quality outcomes
  2. Identifying and understanding the true costs involved in delivering care
  3. Shifting the paradigm of our health care culture from a physician-centric to a patient-centric one

Dr. Porter outlines some of the challenges in defining and measuring quality outcomes. These include the fragmented and insufficient state of medical informatics, the length of time needed to track outcomes, and the dynamic nature of quality outcomes.

He explores the difficulties in measuring costs (not charges) across a continuum of care. Dr. Porter also recognizes that to properly measure value, one needs to identify the proper consumer. In health care the proper consumer is the patient, not the physician. The culture therefore needs to be patient-centric.

As an economist, Dr. Porter presents a well nuanced analysis of the first two hurdles in achieving value in health care: measuring quality outcomes and tracking costs acurately. He may, however, have underestimated the challenge involved in the third: moving from a physician-centric to a patient-centric culture.

Our physician-centric health care culture has deep roots. It is planted in the elitist soil of medical school selection, fertilized by the academic docents of physician indoctrination, and nurtured by the competition skewed by a physician friendly supply-demand curve with further nutritional supplements supplied by a perverse payment incentive system.

The future culture of patient-centric healthcare will not take root in today's American health care soil unless the current physician-centric culture is uprooted. No one should underestimate this task's importance nor its challenges.

Uprooting the current physician-centric culture before it uproots the foundation of the American health care system is the biggest challenge facing our physician leaders. This task will require effective physician leadership in academic medical centers, in hospitals, in outpatient clinics, and in our medical societies. It's time to develop and support effective medical leaders by teaching them the leadership skills required for success.  

Reader Comments (2)

Hey, Fred. Thanks so much for your very thought-provoking post (as usual). Another interesting read.

I agree that our health care culture was originally designed as physician-centric and I also agree the goal should be a patient-centric culture. However, I don't really think that the current culture is still physician-centric.

In my observation, the current culture of health care isn't physician or patient-centric, it's a bureaucrat-centric culture and has been for some time (and getting more so).

When I look at health care today, the current systems in place and the "improvements" that are being discussed seem all focused on improving the system for individuals who are trying to monitor and track and measure health care. These systems are all cloaked in the guise of improving patient care, but I've never seen any hard data that they really do help patients.

If I were to measure the percentage of my time that I spend actually taking care of patients versus the amount of time I spend filling out forms, ordering extra tests, making phone calls, typing data into a computer, and completing paperwork,-- all to satisfy some bureaucratic overlord-- I am certain the latter would far outweigh the former.

It just seems to me that while, yes, a physician-centric culture is not the best and we certainly are not yet to a patient-centric culture, physicians are certainly not calling the shots today and the healthcare culture of 2011 cannot be described as physician-centric. My concern is that the legions of bureaucrats who are currently running health care today find physicians an easy scape goat, instead of taking responsibility for the mess they've created and perpetrated. The bureaucratic-centric culture we're in cannot be changed to a patient-centric culture unless we're willing to define the problem and then seek to return the power back to the patients where it belongs.

Anyway, that's my rant on the subject. Sorry for the soap-box speech. Thanks again for the perspective and I would love to hear your opinion of my views and also opinions from others.

Many thanks for your patience.

Who's responsible for the mess we're in? All of us. The patient who demands a CT scan for a tension headache, the doc who orders it, the lawyer who will sue the doc if he/she doesn't, the bureaucrat who knows the answer, but asks the wrong question, the politicians who make unrealistic promises and the electorate who vote for them because they make the promises that feel good.

Regarding health care centricity, I would argue that too many hospitals say they are patient-centric in thier mission statements, but are still physician-centric in their actions. They are dependent on physicians who fill their beds with a "good payer mix", orthopedics, cancer, interventional cardiology, open hearts etc. These high rolling docs are often excused for inappropriate behavior and enjoy veto privileges on needed initiatives like, EHR implementation, CPOE, group purchasing, new program development, best practice implementation etc.

Successful heath care systems will be the ones who train effective physician leaders who demand and implement patient centric delivery at the risk of alienating large referral physicians as well as misguided bureaucrats.

Thanks for your comments and for all your support.

Mar 7 | Unregistered CommenterFred Tobis

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