Second Curve- a New Strategy for Bending Healthcare s Cost Curve

Transcription

1 Second Curve- a New Strategy for Bending Healthcare s Cost Curve The Tenth National QUALITY COLLOQUIUM on the Campus of Harvard University Cambridge, MA August 14,2012 Martin D. Merry, MD, CM and Tom Bigda-Peyton, EdD, Second Curve Systems

2 Presentation outline Introduction to Healthcare s Second Curve A New Performance Curve and Strategy The Cost of Poor Quality Overuse, underuse, misuse, and waste of care Competing on value Toward high-reliability Improving Quality and Bending the Cost Curve: Current Strategies Government/Policy: Health Reform and the Massachusetts experiment Employer-Based Initiatives: Getting to 50% Cost Reduction (Hannaford, Asheville, Milstein) ACOs and health system redesign (cases from the US and Canada) What s missing/ the Second Curve contribution Reliable System Design: a new leverage point Transforming the Medical-Legal environment SCS startup strategy The Net Effect Way better care at half the cost : the US 2015 project 2

3 Does This Resonate? At this point, we can t afford any illusions (re: health care): the system won t fix itself, and there s no piece of legislation that will have all the answers, either. The task will require dedicated and talented people in government agencies and in communities who recognize that the country s future depends on their sidestepping the ideological battles, encouraging local change, and following the results. But if we re willing to accept an arduous, messy, and continuous process we can come to grips with a problem even of this immensity. We ve done it before. - Atul Gawande, MD. Testing, Testing, The New Yorker, 12/14/09 3

4 No problem can be solved from the same level of consciousness that created it. We must learn to see the world anew. - Albert Einstein 4

5 Performance Healthcare s Second Curve: A New Performance Curve and Strategy First Curve/ 4 sigma Circa 1910 (Craft-Age Culture) Future Performance (Second Curve/ 6+ Sigma) (Bifurcation curve: 2011) Time (Craft+Information- Age Culture ) Crossing the Chasm - 5

6 1st 2nd 6

7 Our 1 st 2 nd Curve Journey Why must we move from 1 st curve health care? What is 2 nd curve health care? How 2 nd Curve Bends the Cost Curve Leadership 7

8 The Four Doctors Halsted Welch Osler Kelly 8

9 The most important event in the history of American and Canadian medical education (And the birth of health care s 1 st Curve ) 9

10 1 st Curve Health Care s Performance Problem Sigma Defects per million 1 690, , , , st Curve Health Care (Craft Culture) 90% OK 100,000 95% OK 50,000 99% OK 10,000 10

11 The Stealth Cost Culprit Cost of Poor Quality?* $390 Billion, Annually * What IOM labels as overuse, underuse, misuse and waste 11

12 The INEVITABLE consequence managing highly complex health care with a 4 sigma quality infrastructure Medical errors as 5 th - 8 th leading cause of death in US 44,000 98,000 deaths annually 12

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15 Toward High-Reliability and Beyond Mechanistic Organizations Less Bounded System More Bounded System Living Organization s Adaptive Living System Normal >>>RWF Grant (22>>>10) Reliable High- Reliability Begin A3s on Falls>>> Use A3s system-wide (12>>>4>>>0) >>>Ultrasafe

16 ... OK, so it s confirmed the sun will slam into the earth in 3 days. I don t want any more gloom and doom, I want suggestions! 16

17 Our 1 st 2 nd Curve Journey Why must we move from 1 st curve health care? What is 2 nd curve health care? 17

18 The 21 st Century s Flexner Report? 18

19 The Vision: 10 Rules of Performance in a Redesigned/2 nd Curve Health Care System 1. Care is based on continuous healing relationships. 2. Care is customized based on patient needs and values. 3. The patient is the source of control. 4. Knowledge is shared, and information flows freely. 5. Decision making is evidence based. 6. Safety is a system property. 7. Transparency is necessary. 8. Needs are anticipated. 9. Waste is continuously decreased. 10.Cooperation among clinicians is a priority. - Institute of Medicine, Health Professions Education,

20 Columns Columns 2 & = = 2nd 2 nd Curve Curve Regulation Hammurabi Legal system State Boards JCAHO Inspection Fed/State regs ORYX, EMTALA, HIPAA, Etc. JC, CMS core measures Medical Science Hippocrates Nightingale, 4 doctors Flexner, Codman, ACS/Hospital Standardization M&M conferences Donabedian,structure process, outcome Outcomes, Disease Management Science Industrial Revolution Taylor: Scientific Management Shewhart Deming, Juran, Total Quality Complexity theory management Six Sigma, Health Care Lean, Reform! Action Evidence based Learning, Adaptive care, Hospitalists Design, Resilience 20

21 1 st Curve 2 nd Curve Evolved around medical and hospital practices Disease focus, one patient at a time Hierarchical, physician controlled Performance problems assumed as people-caused Culture of blame Fragmentation of care givers and health care functions, hand-off gaps common Medical records paper, fragmented, owned by caregiver Complexity frequent errors, harm to patient Quality is compliance-oriented, 2-4 sigma common Reactive to sentinel events Designed around patient/ community experience Health, prevention focus, patient plus population Team-based systems outperform hierarchy Recognition that performance problems 95% systems-based Just Culture Integration of all system elements, care seamless for patients EHR, smart cards owned by patients Integration of quality sciences minimizes error, harm Quality, value oriented toward 6+ sigma performance Proactive, O preventable harm 21

22 Our 1 st 2 nd Curve Journey What is our 1 st curve dilemma? What is 2 nd curve health care? How 2 nd Curve Bends the Cost Curve 22

23 The Policy Environment: Affordable Care Act New insurance rules guaranteeing coverage High-risk pool for people with pre-existing conditions Protection for children with pre-existing conditions Coverage for young adults, to age 26 Small business tax credits Preventive care, free for proven services Early retirees temporary reinsurance Doughnut hole rebates for Medicare Annual review of premium increases Access to care: $ Billions for Community Health Centers and the National Health Service Corps for low-income and uninsured New incentives for providers (ACOs, CMS rewards and penalties, shared gain provisions) 23

24 Improving Quality and Bending the Cost Curve: Current Strategies Government/Policy: Health Reform and the Massachusetts experiment Employer-Based Initiatives: Getting to 50% Cost Reduction (Hannaford, Asheville, Milstein) ACOs and health system redesign (cases from the US and Canada) 24

25 The Deming Cascade: Simultaneous Quality, Cost, Value (W. Edwards Deming) Improve Quality ( Process Improvement) Decrease Cost Enhance Value Increase Market More Jobs 25

26 Designing New Structures 26

27 Our Structural Heritage, Our structural fatal flaw Medical Staff Executive Committee Medical Staff Functions ( Silo 1 ) Board of Trustees Chief Executive Officer Hospital Functions ( Silo 2 ) Credentialing Departmental (Peer) Physicians: Review Surgical Case (craft culture) Review Blood UR Drug Usage Review Pharmacy and Therapeutics Medical Records Nursing Ancillary Laboratory Radiology Physiotherapy Risk Management Finance, Planning Regulatory Agencies Etc. Management: (industrial culture) 2011: The Structure Hierarchy, Fragmentation, Communication gaps, Misunderstanding, Power Struggles, etc. 27

28 Building New Leadership 28

29 Command & Control Pyramid (Taylorism, circa 1900) Commands Top Management Hint: Doesn t Work Anymore Obedience 29

30 Stewardship/Servant Leadership (Covey, Block, others) Those We Serve Caregivers/Innovation Resources/ Support Top Management 30

31 Improve Quality Systemic Leadership (Argyris, Schon, Senge) ( Process Improvement) Decrease Cost Enhance Value Increase Market More Jobs 31

32 Systemic Leadership (Argyris, Schon, Senge) Environment Industry/Sector Organization Intended Consequences Behavior B Thoughts, Feelings, Intuitions Unintended Consequences Beliefs, Assumptions Governing Values Myths, Legends, Heroes Copyright Action Learning Systems

33 Are we ready to board the 2 nd Curve boat? 1 st Curve Void 2 nd Curve 33

34 Case examples 34

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36 The ThedaCare Breakthrough Realizing that ThedaCare needed change, leaders tried one improvement program after another over the course of many years. Most of the programs offered incrementally better results for a while, until everyone slid back into old habits. Finally.. leaders started thinking about breaking down the divisions between caregivers specialties, divisions of labor and habits of working to create a unified focus on the patient. Because this would require change in everyone involved, it was clear that hospital units needed a revolution instead of isolated, incremental adjustments. 36

37 Breakthroughs in progress? Iowa Health System: no falls for Baylor U. Health System: Ontario Health System: Excellent Care for All Act and Strategy Resilience Engineering and Learning Network: Vancouver, B.C. 37

38 In Summary... 1st Curve health care has run its course. It is unsustainable financially and quality-wise, and in search of a new paradigm. Fortunately that new paradigm is already emerging, awaiting our embrace. Emerging now is 2 nd Curve health care, a patient and community-centered system that will be better than we can now imagine. The greatest challenge of moving to the 2 nd Curve is for health care leaders, and perhaps uniquely physician leaders, to understand and embrace this paradigm shift. They will be crucial, at the national, regional, and local levels in maximizing our nation s ability to move toward higher value health care that can fulfill the desires and commitment of virtually all health caregivers - Martin Merry, MD 38

39 What s missing/ the Second Curve contribution Reliable System Design: a new leverage point Transforming the Medical-Legal environment SCS startup strategy 39

40 Patients and Families Reliable System as Part Design of the Care Team Leadership, Co-Management Pharmacy Team-based care MD Nursing/NP/PA Care Social Work Spiritual Healing Case Mgt Home care/ Telemety Accountable Care Organizations Community Partnerships! 40

41 Observed & Expected Operative All Case Operative Mortality Mortality Concord Cardiac Surgery 7/6/98 to Concord Observed 12/31/01 Concord Expected (NNE Risk Model) Salem Observed deaths (When Teambase care, Informatics entered) sequential patients All Case Mortality (percent) (4.8) Concord Expected (2.1) Concord Observed (0.3) Salem Observed 3sd hig expecte observ 41

42 And the Caregivers? Heroes! 2 lives saved by ER, ICU and NICU teams Deeply grateful family (Does it get any better?!) (But does anyone believe that the OB office did a near miss root cause analysis on their telephone triage practices?) 2 weeks before trial, all 3 physicians and hospital settle lawsuits Headline story in local press 1 physician censured by state board of medicine (And can we imagine what it must be like for these physicians today and for how long?) 42

43 Transforming the Medical-Legal Environment Just Culture Relational Law Systemic Law 43

44 Life Sciences Suppliers Improve Care Reduce Cost Create Jobs Medical Devices Increase Access to centers of excellence Increase Access to Outpatient Care Lack of community services Increase in options for community re integration Unique challenges for specific populations of care Need for community navigation Community services need to focus on recovery and medical issues SCS Startup Strategy Increase access to rehab for acute chronic conditions Lack of awareness of Community programs Payors and Funders Lack of accountability in Hospital Planning Delivery System Hospitals, Providers, Care Networks Translate Data into practice Long waits for Services in the community Taking a regional perspective on research Increase connections with Primary care Expanding Caregiver Pilots Expand wellness programs e.g. Fit for Function Need for strategic Collaborations/partnerships Increase need for Peer support survivor groups Need to create systems perspective on care Need to focus on transitions Need to collaborate with other strategies i.e. COPD, Importance of timeliness Diabetes, cardiovascular of treatment Increase partnerships with case management Coordinated Pediatric Care Biotech Technology

45 2 Historical Curves of Health Care Innovation (derived from Kuhn, Toffler, Morrison, Merry) Performance First Curve/ 4 sigma 1910 (Create and Build Momentum) Future Performance (Second Theoretical Curve/ 6+ Ideal Sigma) (Bifurcation curve: 2010) (Transfer/Sustain Momentum) Crossing the Chasm Time - 45

46 Toward Resilient Systems Focus on what goes wrong because we know how things work Robust THEORY OF ERROR Analyze accidents and system failure Avoid unacceptable risk with rules compliance Curve I Resilient THEORY OF ACTION Focus and appreciate the barely noticeable traits of everyday safe and productive work Learn how the system adjusts to sustain performance under expected and unexpected conditions Curve II Today Source: Erik Hollnagel

47 Way Better Care at Half the Cost: the US 2015 Project Healthy Behavior Credit for all employees, the selfinsured, and Medicare/Medicaid recipients; Collaborative Care Model for chronic and persistent conditions; Medical Village Model to create care coordination and patient navigation and align specialists with primary care; Wellness Advantage, a scalable worksite wellness initiative that combines local campaigns with regional and national action learning networks; and Community Hearth/Mosaic, a program that combines learnings from the self-help movement, story-based focus groups, and community health outreach to create local self-reliance, improve population health, and build community resilience. 47

48 The Net Effect When implemented in an ACO, health system, state, or region, the US 2015/Second Curve program results in the following: Reduction of the cost of care to globally competitive levels (e.g. from 18% to 12% of GDP); Improvement of quality to highly reliable levels (on par with high-performing systems in other industries); Patient safety improvement to the level of ultrasafety, thus making healthcare as safe as commercial aviation; Economic magnet zones, supported by an economically sustainable community health model. 48

49 2 nd Curve 49