The Daily Beat

What you should care about in healthcare today, from the editors of Becker's Hospital Review

Code Black: Putting a face on America's access problem

A new documentary takes viewers inside America's busiest ER at Los Angeles County Hospital, where patients are known to wait 12, sometimes 18, hours or more to receive treatment, because they have nowhere else to go.

Code Black, which received the Best Documentary award at the LA Film Festival, was directed by Ryan McGarry, MD. He balanced filmmaking with his ER residency, filming the stories of the hundreds of patients who came through the ER each day, and the physicians and nurses who treat them.

For those in the healthcare industry who haven't been to an urban safety-net hospital like LA County, the film is eye opening. Safety-net hospitals make up 2 percent of all hospitals but provide 20 percent of all charity care in the country.

McGarry began filming during his first year of residency at LA County's old public hospital, the birthplace of emergency medicine and home to the first emergency medicine residency in the 1940s.

Over the course of four years, McGarry profiles the patients and providers as they transition from the old LA County — and its chaotic, outdated and too-small ER — to a new multimillion dollar facility (required by state earthquake code), which in the words of one attending, "moved the ER forward two decades in a single day." This creates a unique opportunity to see the effects of healthcare's increasing regulation and bureaucracy on providers who previously were exempt (thanks to federal waivers).

The documentary sets out to define what it means to be a doctor at this time in America, explains McGarry.

At old LA County, quarters were cramped but camaraderie was high, and physicians and staff spent almost all their time on direct patient care. At the new LA County, forced to comply with a bevy of federal and state regulations, the doctors find themselves spending less and less time with patients, despite no slowdown in volume. Several scenes show physicians alone, logging in and out of EMRs, looking for one of several paper forms, or hunched over while filling out pages of paperwork.

Jaimie Eng, MD, an ER resident profiled in the film, explains the impact: "It takes four times as long to document than to treat the patient."
The film doesn't ignore the benefits of regulations, such as HIPAA's privacy protections, but shows that such regulations do take considerable time away from direct patient care.
"We're not comfortable with this...we became doctors to be with our patients," says McGarry.

McGarry doesn't debate the law's intention — "We all want privacy and we all think it's important," he says. But so many delays in care delivery are caused by minutes spent on HIPAA-mandated minutiae. Anything that takes time away from direct patient care is worth examining, especially during a Code Black — when the ER is overrun with patients waiting hours upon hours to be seen.

At LA County, patients presenting to the ER are given a score from 1 to 4, with 1 denoting patients with the most emergent conditions. At LA County, level 2 patients can wait from 10-15 hours to be seen.

The film puts a face (or rather, faces) on America's healthcare access problem and highlights some of the other "well-intentioned" policies that end up exacerbating access issues.

For example, a state-regulated nurse-to-patient ratio forces ER administrators to shut down a wing. In California, where nurses are in high demand, LA County's ER lost 15 nurses during a four-month span during filming. And, privacy regulation prohibit doctors from treating patients anywhere other than a private room, creating backlogs of patients as doctors wait for rooms to turnover.

"The message is there needs to be balance," McGarry said after the screening. "It seems like we've gone maybe a bit too far in the other direction. Well-intentioned policy doesn't really benefit you the patient or you the provider."


What healthcare can learn from Harley-Davidson


What emotional response does your healthcare brand trigger for patients?

Medicine X, a conference hosted by Stanford on emerging healthcare technology, took place last weekend on the university's campus. Among the speakers — which included Amir Dan Rubin, president and CEO of Stanford Hospitals & Clinics, and Robert Pearl, MD, CEO of Kaiser Permanente Medical Group — Julie Wheelan, vice president of marketing for healthcare innovation incubator Edison National Medical, discussed patient-centric care, and the confusion surrounding it.

Patient-centric care, while important in today's healthcare environment, is an ambiguous concept. An informal survey of more than 250 respondents uncovered numerous definitions of the term.

For healthcare providers seeking to make care more patient-centric, this ambiguity makes their efforts more challenging: They must first define what patient-centric means for their organization, and then empower employees and medical staff to bring the concept to life through processes and behaviors.

For Wheelan, who worked at Harley-Davidson and helped expand the brand into Asia, patient-centric care involves understanding "how emotional connections are forged with customers."

"In my time at Harley-Davidson, for example, I came to appreciate why someone would tattoo the brand's name on his or her arm. When a customer purchases a Harley, they are not simply purchasing a way to get from Point A to Point B; rather, they are buying a tangible (and loud!) statement about their freedom and independence," she has said.

You don't buy a Harley solely as a form of transportation, you buy it for the ride — the journey — as well as the emotions and values associated with the brand, such as independence.

Hence, Harley-Davidson's tagline: "It's not the destination, it's the journey."

How are emotional connections forged in healthcare?
"It's not the destination, it's the journey" as a mindset is apropos for patient-centric healthcare.

A patient's experience is determined more by the course of care than by the outcome of that care. A patient with an excellent outcome can have a terrible experience, while a patient with a terminal illness may have a positive, caring and supportive experience. The difference depends on how the healthcare providers respond to both their physician and emotional needs.

The emotional response
Harley-Davidson is the brand it is today not just because of its bikes, but because of the emotional response it triggers for its customers.

What emotional response does your healthcare brand trigger for patients?

When patients reflect on their experience at your organization, does it invoke worry — of waiting for nurses to respond, inadequate pain management, lack of information and unclear information about diagnosis, treatment and discharge? Or, does it invoke a sense of calm — bringing back memories of a truly caring nurse, or a physician who went out of her way to explain each test, update the family and address their emotional needs?


We spend HOW much on hospital bureaucracy? Why pay-for-performance will only make it worse

The United States spends $667 per person each year on healthcare's red tape and pay-for-performance will only make it worse.

Yesterday, Health Affairs published a study on the cost of healthcare bureaucracy, comparing the cost for hospital administrative costs in the U.S. to seven other countries.

Not surprisingly, the U.S. had the highest administrative costs, with 25.3 percent ($215.4 billion!) of hospital spending going toward red tape — more than any of the other countries studied and more than twice the percentages for Canada and Scotland, which had the lowest administrative expenditures.

Becker's Finance Editor Helen Adamopoulos reported on the study yesterday, and did a great job of breaking down its various findings in her article "Why U.S. hospital administrative costs are among the highest in the world: 7 things to know." One of the data points she highlighted from the study really struck me: The U.S. spends $667 per person each year, or 1.43 percent of GDP, on administrative costs.

We know our country's healthcare administrative costs are considerable. After all, with each provider contracting separately — at different rates — for 10 or more payers, streamlining is challenging. On top of that, electronic billing and records are relatively recent phenomenon.

Why P4P is NOT the answer
The researchers concluded that reforming the U.S. healthcare system to a single-payer model could have saved up to $158 billion in 2011, the year of data studied. While single-payer is unlikely (for a number of political and other reasons) to take hold anytime soon, we can at least take solace in the fact that our pay-for-performance/value-based initiatives will help alleviate this high level of bureaucratic spending….right?

Not so, say the researchers.


5 critical communication skills for healthcare executives

Harvard Business Review has released a complimentary webinar on the top five must-have communication skills senior executives.

The webinar, led by communication expert Kristi Hedges, author of "The Power of Presence," discusses how executives can hone these five critical communication skills: intentional presence, gaining buy-in, delivering executive briefings, connecting with distributed teams, and giving and receiving feedback.

The webinar is intended for executives across all industries, but includes important lessons for healthcare leaders navigating today's complex healthcare environment.


Maybe healthcare shouldn't be local

 High healthcare prices leave one editor considering medical tourism, despite living in one of the best healthcare cities in the world.
Healthcare is local. I've heard this hundreds, if not thousands, of times from healthcare leaders, and for many reasons, it's true. Medical staff dynamics and alignment (both level of and structural arragments) vary by market, as do the health needs of each community.

However, a recent personal healthcare experience led me to wonder if, at least in some cases, healthcare shouldn't be so local.

To be clear, all healthcare isn't and shouldn't be local. If you are diagnosed with a complex disease or have symptoms that can't be diagnosed, you are referred to a tertiary care center. These may be within an hour or two drive, or they might be across the country, for the rarest of cases.

However, certainly routine care should be local, right?

I'm starting to think the opposite. Let me tell you why.

Last month I visited a gastroenterologist, who is employed by an nationally renown academic medical center here in Chicago. It was an annual check up, with nothing out of the ordinary to note. He asked that I head over to the lab for some routine blood work, just to ensure I was healthy as I felt. With my doctor's order in hand, I took the elevator down to the lab, where I waited to be called for the three tests he had noted: A comprehensive metabolic panel, a complete blood count with automated differential and a 25-hydroxy vitamin D test.

A week later, I received the bill, which totaled $698 for the labs, plus another $40 for the blood draw and $119 for the office visit.

And because the lab was hospital-based, it applied toward my deductible, meaning my insurance wasn't covering any of it. I can thank Blue Cross Blue Shield, though, for the roughly 47 percent discount I received, which brought my bill to a slightly more manageable $451.63. Including the $20 co-pay I was asked to pay before seeing the doctor (despite my insurance card clearly denoting a specialist cop-pay of $40 — I didn't argue), the two hours cost me just under $500.

The price isn't necessarily outrageous, but a recent blog post I penned on discount lab company Theranos had me wishing they had an outpost in my neck of the woods. Theranos currently operates 22 lab locations, one at its headquarters in Silicon Valley and the others at Walgreens pharmacies in California and Arizona.

Curious of the potential savings, I ventured over to Theranos' website, where I very quickly located their "Test Menu." There I was able to search for the lab by CPT code (handily included on my bill, which allowed me to ensure an apples-to-apples comparison). The potential savings was pretty spectacular (see chart below).




This is the easiest way to make a hospital CEO squirm

Until pricing in the American healthcare system is more transparent, we can expect continued reporting on shocking hospital bills and, by way of that, more blasé responses, nonsensical skirting and plain old lies from hospital administrators and executives.

I read pieces about hospital pricing — such as Steven Brill's "Bitter Pill," Elisabeth Rosenthal's ongoing "Paying Till It Hurts" series, the recent op-ed in the Wall Street Journal about a $20,000 hospital bill for a head bruise — with great anticipation for the paragraph in which the hospital spokesperson makes an appearance.

It might be the CEO, CFO, an administrator from the billing or payer relations department or a member of the media relations team. (I imagine a long thread of emails exchanged to determine which lucky employee will take the hot seat this time and get back to the reporter.) But despite the title, the quote often embarrasses the individual and, in some way, the institution.

Now, maybe this seems slightly unfair. Why should I place so much emphasis on hospital administrators when the entire healthcare economy is dysfunctional? The device companies, pharmaceutical giants, insurers — what about the roles they play? This is a huge problem, developed over years and years, that I know. But this doesn't let hospitals off the hook or make it any less wrong when they fib. One thing we should probably stop doing: Diluting responsibility by pointing to the size of the problem.   

Again and again, journalists and readers are fed bologna when they ask why a Tylenol with codeine pill at the hospital cost $36.78 when the market price is $0.50, why a troponin test cost a patient $199.50 when it cost the hospital $13.94, why a breast pump costs $543 when we could buy one for $25 online. It is maddening, and there is little urgency to bring any reason into these conversations.

When asked to explain prices for a test or drug, hospital officials often point to the chargemaster, an opaque, massive computer file that determines hospital prices. But then something strange happens. Almost immediately after upholding it as the holy grail of pricing, officials quickly dismiss the chargemaster, noting that few patients end up paying the full "sticker price" due to insurer coverage or negotiated rates. Throughout 16 months of reporting for the TIME piece, Steven Bill said he found "officials treat [the chargemaster] as if it were an eccentric uncle living in the attic. Whenever I asked, they deflected all conversation away from it. They even argued that it is irrelevant."

Some hospital officials act like journalists are dense for even thinking to ask about prices. Mr. Brill included some of hospital officials' blasé responses and bluffs in the article itself. When he asked one CFO to explain the chargemaster prices, the executive shrugged and said, "They were set in cement a long time ago and just keep going up almost automatically."

A spokesperson from Stamford (Conn.) Hospital said he doubted the CEO had seen the chargemaster list in years. "So I'm not sure why you care," he told Mr. Brill.

The senior vice president of payer relations at Yale New Haven (Conn.) Health System first told Mr. Brill the system thinks the chargestmaster is "totally fair." But when asked to explain how the price for a certain test was calculated, he said he "didn't know exactly" and would try to find out. He later said it was "a historical charge, which takes in to account all of our costs for running the hospital."

One hospital spokesperson from Chesterfield, Mo.-based Mercy told Mr. Brill that the health system's lawyers decided the CEO's discussion of a patient's medical bill (with information redacted to protect privacy) would violate the federal HIPAA law. Mr. Brill, a Yale Law School grad, founder of CourtTV and American Lawyer magazine, said he was unfamiliar with a HIPAA provision barring such discussion, but the spokesperson maintained this stance and ended further discourse.

Another hospital CEO in California told The New York Times "you need a PhD in health economics" to understand medical pricing. Not the most patient-centered thing to say, even though it might be true. And if so: Shouldn't we expect more hospital CEOs to get back to school then?


9 ways to make a bad decision

When it comes to leadership, decision-making is often one of the most important responsibilities of a leader. Most decisions aren't easy to make, which is why we need experienced, insightful and intuitive leaders to make them.

Each decision — or organizational path — has its benefits, but each has drawbacks as well. Both must be weighed before the path is chosen.

A good decision, and a leader who is able to align the organization (i.e., its people and processes) around the new pathway, can mean many good things for an organization. A bad one can mean disaster.

With decision-making so critical, a leader may wonder: What leads to good decisions? Bad?

A new study published in Harvard Business Review attempts to answer this question. 

Leadership development consultancy Zenger/Folkman analyzed 360-degree feedback data from more than 50,000 managers, comparing feedback on those perceived as good decision makers with those perceived as poor decision makers.

What they found were nine behaviors associated with poor decision makers. They are as follows (Note: I've simply listed them below, but I highly encourage you to read the full article on for a more in-depth analysis): 


Best practices don't matter. Here's what does.

High-reliability organizations don't implement best practices. They continually make new best practices.

Healthcare is an industry obsessed with best practices. And for good reason. Our costs are growing almost uncontrollably, and quality is highly variable from hospital to hospital, department to department and physician to physician. It makes sense, then, that organizations seeking to improve a measure would look to those who are top performers and emulate their processes.

However, instituting best practices isn't the approach taken by the highest-performing organizations.

What is?

To answer this, let's examine Toyota, the company whose efficient and adaptive practices have led to millions (if not billions) of consulting dollars spent by others who want to learn just how they do it.

Toyota doesn't worry about implementing best practices. Instead, it worries about adjusting and improving current practices in real-time — and doing so continually.

"The focus at Toyota is not to implement standard best practices across the organization," John Kenagy, MD, who studied Toyota in the 1990s while at Harvard Business School, recently told me. "Unpredictable changes in local environments between production facilities and even micro environments inside the same facility create opportunities to continually improve the current 'best practice.' Therefore, Toyota has standard ways to continually create new best practices."

He recounted how one of his Toyota teachers explained the approach to him:

"We know we cannot implement perfect processes because, first of all, we are human and humans aren't perfect. Secondly we know that, even if we design a perfect process, the environment will change around that process in unknown and unknowable ways. Therefore, although we work hard to design the best process possible, it is much more important for us to know when our processes fail and then improve them or the environment around them as quickly, simply and easily at the lowest-cost possible." (emphasis mine)

Ensuring high-reliability and, moving beyond that, innovation, is not implementing best practices. It's the ability to continually make new best practices.  

But, says Dr. Kenagy, 95 percent of established organizations are unable to 1) identify process failures or opportunities for improvement and 2) adjust and improve on the front-line, in real time.

What distinguishes those who can from those that can't?


CEOs love talking about culture. Here's why they shouldn't.

Attributing organizational success to culture doesn't help anyone, because no one knows what culture is.

Ask CEOs in any industry their secret to success, if their answer isn't "the people," $100 says it includes the word "culture." In one edition of Wall Street Journal's "The Experts" column on the five biggest priorities for CEOs, culture is mentioned 15 times!

But what the heck is "culture"?

Apparently, academics have some 164 definitions of culture. Don't worry though, you don't have to read them, let me summarize: Culture is the implicit and explicit patterns of behavior, structures, beliefs, values, symbols, customs, etc., that are shared by a group or society.

So I'm a CEO of an institution that's struggling. We aren't making our numbers, morale is low and there are service or product errors.

I seek out the help of other CEOs. They tell me I must improve the culture.

That doesn't really help me.

"Everybody says it's the culture, but what is the culture?" asks John Kenagy, MD, founder of Kenagy & Associates and a former practicing physician who has studied change management for more than two decades. "Culture is such a meaningless term; it really dodges the issue. Nobody's talking about what it is."

What is 'culture'?
According to Dr. Kenagy, culture, for all practical purposes, can be approached as the sum of four things: mindsets, methods, strategies and structures (which he's dubbed 'M2S2' for short).

That is to say, the M2S2 of your organization are tangible elements of the culture, that when taken together make up the culture — an idea that is a lot less tangible take by itself.

Let's return to my example of the struggling CEO. While he or she can't do a lot with "it's culture," he or she can certainly implement or adapt the M2S2 of like, successful organizations into his or her own.

So, what mindsets, methods, strategies and structures should successful in healthcare organizations develop?

According to Dr. Kenagy, the most successful organizations — those able to weather rapid change and market disruptors — are those that have adaptive cultures. Therefore, organizations should seek to implement M2S2 that support and create structures and processes to foster a culture that adapts quickly to change.

Cultures must support adaptive change
Why is adapting to change so important? To understand this, it's helpful to explore the theory of Disruptive Innovation, the popular change management theory advanced by Harvard Business School's Clay Christensen, who Dr. Kenagy studied with as a visiting scholar from 1998 to 2002. Under the theory, organizations that don't introduce innovation will be disrupted by it.

However, Dr. Kenagy has advanced his own theory, 'Adaptive Design' that argues against the 'disrupt or die' mentality. Instead, he believes organizations can adapt, successfully, to disruptive innovations from competitors or other market entrants.

"Disruption gives you this kind of view of 'boom!' and it's actually not," he says. "Innovation is going to happen, and it will either be disruptive or adaptive to your organization. It's your choice as a leader to be disruptive or adaptive. It's more about what the change is doing to you."

Organizations can succeed in the face of disruption if they adapt quickly — which requires leaders with savvy change-management skills.

Adaptive change doesn't sound revolutionary, but it sort of is
To become an adaptive organization, leaders must support instituting the structure and processes (that is, M2S2) that foster active adaptive change, which is characterized by the ability to change your organization's processes or procedures quickly and appropriately in the face external market forces.

The problem is, most organizations are ridiculously bad a responding quickly to business changes. Why this is involves a quick history lesson. During the Industrial Revolution, businesses that succeeded were the ones that were best able to organize workers and their responsibilities through a hierarchical structure. Managers directed work, and the front-lines carried it out. Management decides, measures, analyzes, improves and controls front-line work. Bigger problems move higher up in the organization.

But, what worked in the Industrial Revolution, doesn't work today. Organizations have so much data that management can't move quickly enough. "Moving data up is just too slow of a process and too inflexible," Dr. Kenagy says.

Instead, organizations must implement M2S2 that enable and empower front-line workers to make and implement decisions on how to improve their work, and to do so in a way that creates a new "value" for the organization.

Essentially, the organization moves away from traditional management (where decision making is sent up the chain) to one where decisions are made and data is analyzed on the front line, by those that are doing the work and know it most intimately. There are no managerial pow-wows to first assess the potential impacts of change or prioritize which have the biggest ROI potential. The ability to change the organization shifts from a top-down approach to a bottom-up one.


How Google searches reveal our country's stark healthcare disparity

If you've never Googled a healthcare service, you may want to consider your life — or your community — fairly comfortable.

That's what some findings from the The New York Times suggest, anyhow. Back in June, the newspaper identified American counties where life is "hardest." This categorization is based on six data points: education (or percentage of residents with a bachelor's degree), median household income, unemployment rate, disability rate, life expectancy and obesity. The 10 lowest-ranking counties in the country include six in the Appalachian Mountains, along with four others in various parts of the rural South. On the other hand, six of the top 10 counties in the United States are in the suburbs of Washington, D.C.

The variation between these "hard" counties and those deemed relatively "easy" is staggering. Median household income in some counties is five times higher than median income in others, and median life expectancy can vary up to a decade. (Here's the composite ranking and commentary, with an infographic that is pleasingly easy to navigate, too.)

This week, the Times team used Google Correlate to see how web search trends differ among counties. The analysis used a decade's worth of Web search data to pin down which terms are popular in places where life is easier versus those where life is more difficult. The analysis canceled out those terms that are popular throughout America, like "Super Bowl" or "Oprah Winfrey," and focused on subjects that were relatively common Web searches in one county but not common in another.

So what'd they find? Well, people in the easy-breezy parts of the country sure love their cameras, or searching them on the Web at least ("if you don't recognize some terms on here, they are probably digital cameras," the Times noted). Maybe an easy life is more photogenic. Some other common searches include ipad applications, dollar conversion and baby bjorn. Best cupcake also shows up near the middle of the list.

Many of the terms center around technology, photography, travel and products (oven review or ipod remote). Oddly, the Ben Stiller classic "Zoolander" comes up twice out of 90 times. Healthcare terms are noticeably absent.