Healthcare Reform Will Remain A Good Intention

Editor's note: We suggest that prior to reading this article, you read Introduction to Performance Measurement and Control Systems.

There is indeed need to improve our healthcare system. Many academic, economic and management experts have gone over the nearly 2,000 pages contained in both the House of Representatives and preliminary Senate proposals.

The verdict appears, at the moment, to be thumbs down on both plans. Some think it's shameful; others think it's downright scary; still others believe it needs to be thoughtfully and thoroughly redone with respect to its mission and purpose

Perhaps the administration will rethink what must be done and how to do it. We certainly hope so.

The astonishing work of Peter F. Drucker, W. Edwards Deming, Joseph Juran and countless others must be read and understood by our elected representatives.

Our governmental leaders must understand the concepts of streamlining and re-engineering processes in order to obtain the desired cost and quality outcome measurements. Otherwise it's sheer folly to think that costs can be lowered and quality of care improved.

If they would take the time to study the methodologies of these thought leaders, much pain and suffering could be prevented—and significant contributions to our society's well-being could result.

The escalating opposition to the Obama administration's healthcare plan, in part, is caused by the growing awareness that there are no truly satisfactory measurements yet developed by the government.

To say our objective is to "Improve healthcare and lower its costs" is an operationally meaningless statement. Nothing can be deduced from statements of this kind with respect to the goals and the work needed.

The government has not yet rendered explicit the specific results expected. Other than generalities about cost-reduction, sharing best medical practices, data-driven medical decisions and the like, this administration appears to have lofty objectives masquerading as attainable performance measurements.

They simply explain why a specific program or agency is being initiated rather than what the program or agency is meant to accomplish.

Said Peter F. Drucker: "Developing performance metrics or desired results is always specific, always mundane, always focused...Yet without performance goals that can be measured, appraised or at least judged, there will be non-performance."

"To think through the appropriate measurement is in itself a policy decision and therefore highly risky. Measurements, or at least criteria for judgment and appraisal, define what we mean by performance."

In short, the current healthcare reform proposal lacks specific performance metrics. In effect, measurements decide what phenomena are results.

Healthcare Reform Requires Specific Measurements

Healthcare reform is not even a pious intention. It is at best a vague slogan. Even "the best medical care for the sick," the sometimes preached objective of the administration, is not operational.

Drucker long ago suggested improving healthcare performance metrics such as:

• "To make sure that no patient coming into Emergency will go for more than three minutes without being seen by a qualified triage nurse."

• "Within three years, our maternity ward is going to be run on a zero defect basis, which means that it will be no surprises in the delivery room and there will not be one case of postpartum puerperal fever on maternity."

With measurements such as these it is possible to develop strategies and tactics for accomplishing the desired outcomes... continuously obtain feedback from actual results...and take corrective action when deviations occur.

Said Drucker: "The right measurements dictate where efforts should be spent. They determine whether policy priorities are serious or merely administrative doubletalk."

To control performance, Drucker reminded us, management needs to know more than what their goals are. They must be able to measure their performance and results against measurable goals. And, of course, there must be a system in place for capturing relevant information.

The management of any institution—especially, government—must have clear and common measurements associated with each and every program. Measurements need not be rigidly quantitative nor need they be exact.

However, measurements must be clear, simple and rational. And the following questions must always be asked: Are the measurements we selected the appropriate measurements? Will attainment of the quantitative goals solve the stated problems?

We believe much work has to be done by President Obama and his administration to develop the right measurements and the right strategies and tactics for remedying the root cause of identified problems.

Information gathering, analysis and synthesis must become an organized activity. In the absence of information about a trend or change in a given performance metric, a program's performance cannot be evaluated.

W. Edwards Deming, in his classic book Out of The Crisis (MIT Press,1982), suggested dozens of specific metrics for improving healthcare. These included:

• Delays in posting laboratory results to charts of patients
• Incorrect dosages of drugs to patients
• Inadequate monitoring of patients during drug therapy
• Number of toxic reactions observed to drugs given
• Number of laboratory tests ordered but not performed
• Mortality rate during surgery
• Percentage of rework in laboratory

Dozens of outstanding books in the field of quality management for healthcare outline solid methodologies for streamlining and re-engineering (i.e. redesigning) healthcare processes that lead to lower costs and higher patient quality care.

It may be a much more productive allocation of scarce resources to help (fund) healthcare institutions put into operational reality the ideas of Drucker, Deming, Juran and many others.

Initially, the announced purpose of the healthcare reform plan was to reduce costs and improve quality. If that's still the goal, we are perplexed on how the proposed strategy and tactics accomplishes this.

These late great people spent their professional lives developing approaches to deal with the real problems causing rising healthcosts.

In Conclusion

The "don't experiment, be dogmatic" approach, that is, "whatever it is that you do, do it on a grand scale at the first try" is doomed to failure. As with everything else in management, we must learn from experience.

Said Drucker: "In technical or product innovation, we sometimes skip the pilot-plant stage, usually to our sorrow, but least we build a model and put it through wind tunnel tests."

Some people have commented that the government appears to have started out with a "position," that is, a totally untested theory, and going from it immediately to national application. Unfortunately, that's the way it seems to be happening.

The proposed healthcare plan, as it stands now, is totally speculative. Totally untried social science theory, and backed by not one shred of empirical evidence that it will work.

Indeed, we are no longer sure of what the mission and purpose of the healthcare plan is all about. There's been much rhetoric about reducing costs and improving patient care. But it doesn't seem to us the strategies and tactics selected address this expressed concern.

The administration must think through in advance what is expected. The administration must decide what the objectives of the program are really all about.