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Overview
In healthcare, strong leadership is crucial. Today's volatile and ever-changing environment calls for a new set of leadership skills. As cost reduction, quality improvement, and management of scarce resources become increasingly important, healthcare leaders must know how to build a positive culture, manage change and conflict, establish trust, promote creativity and innovation, and empower every staff member in their organization to succeed.
Principles of Healthcare Leadership provides complete coverage of the topics most vital to the success of a healthcare leader. Beginning with foundational leadership theory, including a discussion of power and influence, the book then explores distinct leadership styles and skills, the importance of organizational culture building, and strategies for leading people in healthcare delivery.
Additional key topics include:
Creativity and innovation Entrepreneurship Trust Change and conflict Leadership development and trends Team performanceEnd-of-chapter summaries and discussion questions allow students to review and apply each chapter's concepts while they learn. Five comprehensive leadership case studies provide opportunities to integrate and apply skills featured in the book.
The future of healthcare is now, and this book will guide leaders, current and future, as they manage daily change and growth in their redesigned healthcare organization.
Product Details
| ISBN-13: | 9781567938951 |
|---|---|
| Publisher: | Health Administration Press |
| Publication date: | 06/22/2017 |
| Series: | AUPHA/HAP Book |
| Sold by: | Barnes & Noble |
| Format: | eBook |
| Pages: | 315 |
| Sales rank: | 883,147 |
| File size: | 3 MB |
About the Author
Read an Excerpt
CHAPTER 1
THE FUTURE OF LEADERSHIP IN HEALTHCARE
Bernard J. Healey
Learning Objectives
After completing this chapter, the reader should be able to
• identify the major challenges facing the US healthcare delivery system and potential solutions to them,
• understand the need for change in healthcare delivery,
• understand the role of leadership in preparing the organization to meet the future challenges, and
• recognize the need for healthcare leaders and followers to work together toward solving the many US healthcare issues at hand.
Key Terms and Concepts
• Affordable Care Act (ACA)
• Comparative effectiveness research (CER)
• Cost–benefit analysis
• Cost-effectiveness analysis
• Fee-for-service
• MRSA (methicillin-resistant Staphylococcus aureus)
• Paradigm shift
• Pay for performance (P4P)
• Psychological trap
• Resource trap
Introduction
No one can predict with certainty the future of healthcare in the United States. Despite this fact, some researchers and authors have come out with their own predictions concerning the healthcare delivery system over the next ten years.
The only certainty is that the continuing escalation of healthcare costs, along with the diminishing quality of healthcare services, is not sustainable for much longer. Few individuals seem happy with the current healthcare system, including those who purchase healthcare services and those who deliver these services. In addition, the healthcare industry is ripe for disruption by low-cost providers who concentrate on giving consumers what they want in terms of healthcare delivery at a lower price. The healthcare industry is in the process of major change, and that shift is descending quickly.
In his book Disrupt You: Master Personal Transformation, Seize Opportunity, and Thrive in the Era of Endless Innovation, Samit (2015) points out the classic traps of corporate success covered by Vijay Govindarajan in his research. As demonstrated in Samit's book, Govindarajan (2016) describes them as a resource trap, a management psychological trap, and a failure to plan for the future. These traps are all wide open, ready to capture unaware staff, and are found in many healthcare organizations despite numerous warnings to root them out. Some healthcare organizations have already been disrupted by other companies taking advantage of these traps to the point that the organizations must file for bankruptcy.
The resource trap can be seen in organizations that continue to invest scarce resources in old systems rather than looking long and hard at what the future requires. One example is the organization that continues to invest in buildings that the future healthcare organization may not even require, a scenario being played out in many healthcare systems expanding emergency departments (EDs) with little consideration of changing reimbursement procedures that may not favor utilization of the ED.
The second trap, known as a management psychological trap, is common in healthcare systems that hold onto the ways activities and processes have been performed in the past. Healthcare administrators spend countless hours in so-called planning meetings and talk about past successes and how they need to be continued into the future. The current turbulence in the US healthcare environment is disrupting almost every part of the delivery system, and past successes do not ensure that past processes will continue to work.
The third trap mentioned by Govindarajan (2016) is the inability to plan for an evolving future. In healthcare, this trap is evident as many current administrators have failed to realize the future role for healthcare providers in the prevention of illness. Instead, they continue to focus on treating chronic diseases and their complications after they occur. To thrive under a value-based reimbursement model, healthcare organizations must design a strategy to prevent the complications of chronic diseases from developing and deploy resources to prevent chronic diseases from occurring in the first place.
Responding to these three management traps, especially as they relate to concerns of chronic diseases, requires a paradigm shift for most healthcare organizations. They often have failed to view the prevention of disease as their primary responsibility, being more interested in — and rewarded for — curing disease after it has occurred. Prior to the shift from volume- to value-driven incentives, organizations made little effort to keep people well because of the way the reimbursement system was structured and the fact that people usually consider visiting a provider only when they are ill. These factors led to a reimbursement system whereby providers were paid for services rendered, known as fee-for-service (discussed later in the book). Furthermore, medical education is centered on treating curable diseases, mainly by prescribing one or more drugs. Though well-intended and often effective in making patients healthy, a new emphasis should be placed on an illness prevention paradigm throughout the US healthcare system.
Once the healthcare organization leaders and staff get serious about keeping people healthy rather than having to treat illness, or even allowing the population to get sick, a reduction in the cost of healthcare and an improvement in their population's health status should occur. Those who are responsible for reimbursing providers of care — payers — also need to shift the reimbursement structure from incentives to achieve the cure to those that reward prevention of disease. The time for discussing the need for prevention programs is over; healthcare leaders now must make the changes. This change can occur, through strong leadership throughout healthcare organizations, by altering the way healthcare is provided to consumers.
The Changing Healthcare Environment
Most health policymakers agree that the real cause of both cost escalation and diminished quality of healthcare services is the epidemic of chronic diseases and their complications. One important component of solving this complex problem is enhanced leadership, along with empowered followers, that supports creativity and innovation in the development, implementation, and evaluation of health education initiatives among organizations throughout the United States. The US healthcare system has no capacity for separate operational or professional silos, nor for professions' desire to hang onto power as if their existence depended on it.
The main question that needs to be answered by healthcare researchers is what changes in the delivery system will occur over the next several years because of the shifting healthcare environment. Numerous experts in health policy research have attempted to answer this question, but agreement on the results is lacking. Some experts predict the system will go into a crisis mode, seeing no end in sight to escalation of costs and lowered quality of care. Others view all the changes as a tremendous opportunity to build a new system of healthcare delivery that contains costs while improving quality. This new system of healthcare delivery, if designed properly, should also result in a healthier population.
According to Emanuel (2014), an architect of the Affordable Care Act (ACA), six megatrends will directly result from the 2010 legislation, assuming the ACA remains intact during the Donald Trump administration. These shifts should be evident following 2020 and include the following:
• A change in the care of chronic diseases and mental health care
• Hospital closures
• Major changes to medical education
• A change in the role of health insurance companies
• The end of employer-financed health insurance
• The end of cost escalation
Each megatrend is explored further in the paragraphs that follow.
One might view these six trends as resembling dominoes ready to collapse. If we are unable to reduce significantly the complications from chronic diseases and their attendant costs, these diseases may bankrupt the United States. This situation calls for significant changes to address chronic diseases, including mental health issues.
The use of hospitals as a center for healthcare delivery is an outdated concept long overdue for change. Hospitals suffer from the so-called cost disease found in nearly every sector of the healthcare delivery system. This author is confident that the expansion of chronic diseases will be reversed, and when that happens, overall hospital census will drop. However, hospitals continue to expand capacity in almost identical fashion to colleges, which continue to purchase real estate while experiencing drops in enrollment.
A change in the way physicians are educated is similarly overdue, but such shifts face tremendous resistance. Physicians receive redundant medical training but little education in the prevention of disease and team leadership. As reimbursement systems change from fee-for-service to payment for outcomes, physicians need to expand their knowledge of proven prevention techniques that will be necessary to reduce the complications arising from long-present chronic disease.
To realize Emanuel's (2014) projected changes to the insurance industry and the employer's role, a serious discussion regarding third-party payers must take place, beginning with ways to reduce the costs of healthcare delivery and improve the quality of care delivered. These goals are not being achieved by the prevailing system, whereby insurance companies collect money from employers and then reimburse providers for activities that may or may not improve the health of US populations. The discussion must include the employers who are paying the ever-increasing bill, currently written off as an expense of doing business.
Much discourse in recent years has concerned the creative destruction of the US health insurance industry. The providers of health insurance have not used their market power as an incentive to demand better quality and lower prices from the providers they essentially employ. Instead, a steady trend has been seen of reduced payments and increased denials of care for their consumers. A much better strategy is to motivate providers to provide the right care rather than denying care — resulting in the final megatrend, an end to healthcare cost escalation.
Emanuel's (2014) predictions seem accurate considering the currently turbulent healthcare environment. In this textbook, we use these predictions as background for proposing how the US healthcare system can deal with the major problems discussed.
Changing Reimbursement Methods
One major reason for the continued cost escalation in healthcare delivery is the way providers of care are reimbursed for their services. It is not the intent of this chapter to explain the history of healthcare finance or provide an overview of the many reimbursement terms that make payment for healthcare services so different from the financing used in the payment for most goods and services in the US economy. Instead, the focus is on demonstrating how the reimbursement methods for healthcare services will change and how these changes will affect the future of US healthcare delivery.
As mentioned previously, the historical approach to paying providers has been on a fee-for-service basis. The problem with this payment mechanism is that it encourages providers to offer more care than necessary, bringing little value and perhaps even harm to the patient. In essence, it allows the care provider to create her own demand for healthcare.
To eliminate this so-called perverse incentive, a movement must take place to reimburse providers for healthy patient outcomes. To be successful, this move to performance-based reimbursement, or pay for performance (P4P), requires healthcare providers to work with their patients by offering education about their health status and how to avoid high-risk health behaviors that result in chronic diseases and their complications. A great deal of physician–patient contact is necessary under this system.
With increased contact between physicians and patients comes increased payment to the provider. Even so, overall costs should eventually be reduced because of the positive impact this patient education is expected to have on population health.
If more than $3 trillion a year is expended in the United States on healthcare services, we should have a good idea of what services work best and what interventions in healthcare should not be reimbursed. This expectation is a main reason so much discussion has emerged about comparative effectiveness research (CER).
The Role of Comparative Effectiveness Research
Feldstein (2015) notes that health economists have long been interested in using economic analysis to decide how scarce healthcare resources should be used. The most popular forms of economic analysis are cost-effectiveness analysis and cost–benefit analysis. Simply stated, the costs of medical procedures are compared with the benefits that result from the use of those procedures. If adopted, economic analysis would help identify and eliminate approximately $1 trillion a year worth of waste on unnecessary and potentially harmful medical procedures.
Encouraging the elimination of $1 trillion in wasteful healthcare services through economic analysis is a compelling idea. But how does an organization determine what represents waste in the delivery of healthcare services? The answer is CER.
Feldstein (2015) indicates that more than $1 billion was allocated to CER in 2009 as part of the American Recovery and Reinvestment Act, and an additional $3 billion was made available for CER through the ACA. CER has helped decision makers determine the cost and value of treatment options by testing the effectiveness of medical procedures and seeking less expensive alternatives for achieving a positive outcome.
An early attempt at evaluating medical care was conducted in 1967 by John Wennberg, at the Institute for Health Policy and Clinical Practice of Dartmouth College. Wennberg (2010) analyzed medical data to determine how well hospitals and physicians were performing. He found tremendous variation in every aspect of healthcare delivery — practice patterns, types of medical tests ordered, and types or numbers of surgeries performed — depending on geographic location. Worth noting is that such variation continues throughout the United States.
For example, exhibit 1.1 offers a comparison of total reimbursement per decedent for treatment during the final two years of life at several US academic medical centers. As seen in the exhibit, wide variations are evident in each measure. Feldstein (2015) argues that this type of information can provide a great service to the US healthcare system by helping to determine the effectiveness of treatments and medicines. This knowledge can then be shared broadly through the practice of evidence-based medicine to improve the quality of care delivered.
To complement the promise of CER and ensure the system's ability to control healthcare costs, an organized effort is needed to find accurate data with which to prove the value, or lack of value, of treatment regimens for the vast majority of health issues. That both positive and negative implications are inherent in the use of CER for reimbursement determinations should not stop this important discussion from continuing. Discovering the best way to handle different medical conditions helps guarantee quality service to all US residents at a cost all can afford.
Measuring the Quality of Healthcare
In recent years, the Institute of Medicine (IOM) has raised concerns about the quality of healthcare services in the United States. It has published several research-based reports concerning quality indexes along with numerous recommendations for how to improve healthcare quality (e.g., IOM 2000). Among the most serious quality issues being addressed are medication errors and hospital-acquired infections.
Claxton and colleagues (2015) present a number of reasons for concern regarding diminished quality in health services delivery. Some of these reasons are discussed next.
Healthcare Services Are Vital for Everyone
When one becomes ill, one usually is unable to work and enjoy life. In this situation, there is no substitute for healthcare services. The individual in need of healthcare wants the best care possible and generally is not concerned about the price of that care. Because most US healthcare consumers do not have a medical background, they tend to evaluate their experience on the basis of service criteria: the amount of time they have to wait, the length of their visit with the physician, how well they are treated by the organization's staff, whether their health situation improved as a result of their visit to the healthcare facility, and so on.
(Continues…)
Excerpted from "Principles of Healthcare Leadership"
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Copyright © 2018 Foundation of the American College of Healthcare Executives.
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Table of Contents
Preface,
Introduction,
Part I Introduction to Leadership in Healthcare,
Chapter 1. The Future of Leadership in Healthcare Bernard J. Healey,
Chapter 2. The Evolution of Leadership in Healthcare Bernard J. Healey,
Part II Leadership Skills,
Chapter 3. Leadership Theory Bernard J. Healey,
Chapter 4. Creativity and Innovation in Healthcare Bernard J. Healey,
Chapter 5. Healthcare Entrepreneurship Jeff Helton and Nancy Sayre,
Chapter 6. The Development of Trust in Healthcare Organizations Tina Marie Evans,
Part III Organizational Culture Building,
Chapter 7. The Process of Culture Development in Healthcare Organizations Bernard J. Healey,
Chapter 8. The Process of Change in Healthcare Organizations Bernard J. Healey,
Part IV Leading People in Healthcare Delivery,
Chapter 9. Conflict Management in Healthcare Organizations Tina Marie Evans,
Chapter 10. Developing Leaders and Improving Team Performance in Healthcare Organizations Bernard J. Healey,
Chapter 11. Physician CEOs as Leaders in Healthcare Organizations Francis G. Belardi,
Part V Leadership Case Studies,
Case Study 1: Leadership and Never Events Bernard J. Healey,
Case Study 2: Leadership in Wellness Programs Susan Diana and Dana Abend,
Case Study 3: #ThinkBeforeYouPost Katie P. Desiderio,
Case Study 4: Leadership in a Changing Healthcare Environment Bernard J. Healey,
Case Study 5: Transforming Community Health Justin Beaupre,
Glossary,
Index,
About the Author and Contributors,