With 10,000 hospitals the largest of which has 6500 beds, China healthcare is like everything else in the massive country. The scale is unfathomable. But as I have found visiting 11 countries over the last five years, the problems are exactly the same in China as everywhere else: the costs are sky rocketing, the quality is not reliable, and mostly not measured, and there is no transparency of performance.
China delivers most care through hospitals. There are outpatient clinics in many cities but the Chinese consider them inferior to the care they receive at hospitals. So you can imagine the bottleneck when hundreds of millions of Chinese try to get care care every day at the hospital. As is true in the U.S. when care is designed around the provider. A friend who’s mother was in the Internal Medicine hospital at a large multi-hospital complex had been in a bed for 20 days. Nothing was happening. Then the friend went to the surgical hospital (a completely separate building on the same campus) and pleaded with a surgeon to come and see the patient. The surgeon on seeing the patient transferred her to the surgical hospital (wheeling the patient out the door and across the street literally) performing surgery the following day. This is the ultimate silo thinking but is not much different than American hospitals I’ve visited.
During our visit we were invited by the Chinese Hospital Association to deliver a session on lean in healthcare. Initially, the officials thought a room accommodating one hundred would be fine. Because of interest they moved us to a room seating 300 and it was mostly filled. After the conference many Chinese doctors approached me very excited. There is a lot of pain. With huge need to deliver better through-put at lower costs the Chinese including party leadership are looking for help.
My first book, On the Mend, was introduced in Mandarin with great fanfare. We gave out 300 books to attendees who were elated. We also visited two Chinese hospitals during the visit. These were both top notch hospitals for China. One thing was clear, they have a lot of technology. Everything from robots to iPads, but missing was standard work processes. As we know technology without process doesn’t deliver better results just more expense.
China has much to gain with lean. Because of a very large burning platform(1.3 billion people) it wouldn’t surprise me if they beat the U.S. to the punch.
The nation is looking for answers to the healthcare mess. The financial media is scouring the world for anyone with a clue as to what really to do. Recently CNBC has focused on work done at the Center. They published an editorial I wrote http://www.cnbc.com/id/48608480 which outlines the three components of true health reform. These are: care delivery redesign using lean principles, transparency of cost and quality outcomes, and payment that rewards patient value. These principles are the cornerstones highlighted in my new book Potent Medicine: A Collaborative Cure for Healthcare. In the book we recommend practical solutions that have been working in Wisconsin and could work for the rest of the country and the world for that matter.
Hospitals and doctors still get paid based on the sickness care model. It should be no surprise why 30 day readmission rates for common clinical conditions haven’t changed over a three year period: Hospitals get paid to readmit patients not to keep them out of the hospital. Even though penalties are about to be applied by Medicare for readmissions the penalties do not outweigh the benefit for hospitals.
It’s very difficult to get the entire team required to reduce readmissions to work together. In some cases, the hospital has no control over the outpatient side of the business leading to little connectivity of the clinicians critical to move the readmission metric. Add to that negative financial consequences of reducing readmissions and nothing changes.
At ThedaCare, 30 day readmission rates for the common conditions identified in Kaiser Health News have dropped to U.S. benchmark performance of around 8% and guess what’s happened? Commercial insurers and Medicare have reaped benefits while ThedaCare suffers the financial result of fewer patients in hospital beds. ThedaCare is participating in the Pioneer ACO model. Clearly, Medicare needs to pay differently and the Pioneer may be the way to do it. But the payment change is not coming fast enough. ThedaCare and others such as Harvard Vanguard Medical Associates in the greater Boston area have proven readmission rates can be dramatically reduced. The problem is they are jeopardizing financial results to do the right thing.
We need more significant payment experiments such as what is happening at the Partnership for Healthcare Payment Reform http://www.phprwi.com/ and the Pioneer ACO model for the industry to truly reform. Grant funding from government and private foundations should be funneled in this direction as quickly as possible if we are going to get on top of the cost and quality crisis.
As lean thinkers we need to keep in mind the “enterprise wide” value stream. This means understanding every step in the customer’s experience from time to when an abnormality occurs to cure. But what if there is no process to identify abnormalities? Today we have a process that is perfectly designed to deliver poor health outcomes for farmers. It goes way beyond whether we actually have the right providers and care processes designed correctly in a medical clinic. More and more our thinking has to shift to understanding the entire customer experience. This includes understanding their work, where they live, what their access to healthcare is etc. ThedaCare’s Community Health Action Team found that most rural Wisconsin farmers were fearful of doctors and refused to go to the clinic. So, the team brought nurse practitioners to them piggybacking off the local agriculture extension service. The team had to build trust before it could save lives. The natural place to start was the extension.
In the adjacent article from Commonwealth the program to address the needs of farmers in rural Wisconsin is highlighted and brought to national attention. The importance of this work,however, is the difference in thinking about the health of a relatively isolated population. This thinking can be applied to any population of individuals from inner city America to the farm fields of Wisconsin. The point being that lean thinking is very applicable to population health and if it was utilized more often community health teams such as the Rural Health Initiative in Wisconsin would be the rule rather than the exception.
The Center’s three-pronged strategy for true health reform relies on two parts of the bill that are most important — payment reform and the release of Medicare data with public reporting.
We believe the experiments established by CMMI to test bundled payments, comprehensive primary care payments and the Pioneer ACO program, which moves to global payments in year three, are all fundamental to the redesign of American healthcare.
The Medicare data release rules are cumbersome at this point. However, officials at CMS have been trying to work with both private parties and state governments to release this data in a format that is useful to providers and the public. We continue to work with CMS to make this happen.
Finally, our work in delivery redesign is creating much more efficient and higher quality care delivery. The reduction in CMS payments over the next few years is motivating providers to improve performance, and we believe the lean methodology which we continue to teach and facilitate is the only established approach to meet these challenges.
Inova has been working hard to deliver better value to customers using lean. The executives are taking this thinking now into new payment methods as this article in the Washington Post clearly articulates.
AHRQ releases it’s state health rankings once a year. Wisconsin and Minnesota have been competing at the top for years and this year Minnesota won out in a close race. There are many good things happening in both of these states including transparency initiatives, lean healthcare, and major payment reform initiatives. Those that argue these states just have better demographics should know that in Wisconsin alone there were 1.1 million medicaid members in 2011. That is nearly 20% of the population at the poverty level yet look at what can be achieved when a collaborative multistakeholder group in a whole state works together to deliver better health.
There is much that remains to be done but these results give others hope that it’s possible to improve the health of an entire state.
Lean in healthcare is beginning to take off. Five of the eleven high value health systems in this new report have deeply committed to transforming the entire organization using lean practices and principles.
ThedaCare, Virginia Mason, and Denver Health have been using lean as a transformational set of principles for years. All three have been highlighted in multiple peer reviewed publications and have proven track records. Kaiser Permanente has established the Santa Clara Ca. hospital as the “model line” for KP’s experiment to determine if the method will be applied across the hospital system. Cleveland clinic is transforming the lab and pathology institute using these principles.
None of this is surprising. The core concept of delivering improved customer value is at the heart of the lean transformation. The healthcare industry now realizes that it is critical to improve quality and reduce cost at the same time. Lean delivers both and is the only reliable known method to consistently deliver improved value to patients.
It’s helpful that the IOM is calling out these organizations as examples of great performers that the industry should be carefully studying.
John Toussaint, MD, CEO of the ThedaCare Center for Healthcare Value and author of the recently published Potent Medicine: The Collaborative Cure for Healthcare is featured in this presentation summarizing the three core elements needed to dramatically improve healthcare value in the United States:
Delivery of Care Designed around the Patient. Meaningful care delivery is organized around the needs of the patient, not the convenience of insurance companies or doctors.
Transparency of Treatment Quality and Cost. To build a true picture of any healthcare system, we must identify accurate data regarding quality and cost, and publish it in a way that people understand.
Payment for Outcomes. Right now we pay for procedures, and we do it more than any other industrialized nation. What we really want to pay for is health.
In this video, Dr. Toussaint also introduces two payment experiments currently occurring in Wisconsin. The Partnership for Healthcare Payment Reform is testing a shared savings and bundled payment model for knee joint replacements with six hospitals. ThedaCare and Bellin Health were designated as a Pioneer ACO, the only one in Wisconsin. This ACO covers 25, 000 Medicare beneficiaries in northeast Wisconsin.
Watch this forum for future information on these experiments as they unfold.
