NEW @ THCB PRESS: Surviving Workplace Wellness. Spring 2014. Al Lewis and Vik Khanna. e-book edition. # LIGHTHOUSE Healthcare. Illuminated.

David Whelan

Cleveland Clinic is the health care industry trailblazer when it comes to publishing its clinical outcomes. As discussed in this earlier story (“How To Report Quality To The Public”), the Ohio hospital system annually publishes Outcomes Books that detail the clinical performance of each of its departments.

If you doubt this is radical, go to your local hospital’s Web site. See if it publishes how many patients died during heart surgery last year.

At Cleveland Clinic that number is easy to find. The hospital performed 459 bypass surgeries and only three patients died in the hospital. That is about a third the rate of deaths recorded at other hospitals for the same procedure.

Yet Cleveland Clinic does not only publish data that casts itself in a favorable light. In the third quarter of last year, 3% of bypass patients had strokes after their operations, when that number should have been around 1%.

I called the hospital’s corporate office to find out more about the history of the Outcomes books, how they affect hospital operations, and if there were lessons to share. I asked to speak to the de facto “Chief Transparency Office” and assumed I’d be directed to a middle manager working in the office of public affairs or marketing.

Instead, I soon found myself on the phone with the CEO. It turns out that Delos “Toby” Cosgrove, who runs the $6 billion health system, is also the organization’s unofficial transparency officer. He was the guy who developed the Outcomes Book concept in the first place.

Continue reading “Five Lessons in Transparency from Cleveland Clinic CEO Toby Cosgrove”

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There’s a larger question here about why the scholarly world allows itself to be judged by secretive Scandinavian committees sitting on endowments funded by money made selling explosives. But let’s put anti-Nobel polemics aside.

The announcement today that Alvin Roth and Lloyd Shapley won this year’s award in economics came with the explanation that they had devised systems for matching buyers and sellers that led to more rational outcomes than existing markets.

Shapley, a contemporary of “A Beautiful Mind’s” John Nash, introduced an elegant theory 50 years ago to explain the (relative) stability of marriage pairings despite the fact that individuals have complicated preferences when choosing a mate. Shapley’s idea is that the person you end up with is the best match given everyone else’s preferences.

You might prefer someone else more than your current mate, but that person has you lower on her list, and so on. Imagine Larry. If he could Larry would have definitely married Elizabeth Taylor. But she was taken so now Larry is happy with his actual wife. (To sum it up in a way that would make an economist cringe.)

Alvin Roth built on that early theory. He designed actual markets that used the matching principle, also known as the deferred acceptance algorithm, as a guiding principle. The most famous example of a Roth market is the Residency Match.

Medical residency is a job that lasts three to seven years, depending on the program, and follows graduation from medical school. It is required for a doctor to complete a residency in order to be licensed to practice.

In the “old days” medical students would apply to hospitals and rank their preferences in a way that was visible to those institutions. A hospital would first review those applicants who had indicated them as the first choice. If spots remained to fill, a hospital would then look at those who had picked it second, and so on. You can quickly see how this system punished people who shot high and missed. They would end up at one of their last choices because the best places would fill up quickly.

Continue reading “Alvin Roth Receives Economics Nobel For Flawed Residency Match System”

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Affordable Care Act (ObamaCare) has been knocked for its alleged unintended consequences. The bill’s attracted speculation that workers will lose their health plans, college grads will stop looking for jobs, and even that fewer people will get married.

Those are just the effects related to insurance regulations. Less attention has been given to how hospitals and health systems might change  after ObamaCare.

The most common theory is that reform causes consolidation. But what if the effect on hospitals is even more radical? What if the legislation changes the largely nonprofit nature of the industry?

Right now approximately 60% of the 6,000 or so hospitals in the U.S. are nonprofit, while 25% are government-owned. The rest–fewer than 1,000–are for-profit. There’s a reason the pie cuts this way.

Religious groups, especially Catholic orders, opened many of these facilities as charitable institutions. (Ever driven by a hospital with Mercy in its name?)

Then during the post-war infrastructure boom the federal government offered subsidies to cities that wanted hospitals. Getting the money required nonprofit tax status and a promise to provide “community benefit.”

Continue reading “How ObamaCare Could Cause Nonprofit Hospitals To Lose Tax-Exempt Status”

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This summer I spent some time exploring how big teaching hospitals publicly report clinical outcomes to the public. For a given set of patients, how many live or die? And with what complications?

Patients can rarely find this information before getting elective surgery, or when deciding to commit to a given institution for a long-term course of treatment.

The problem is that right now there are few short-term incentives for hospitals to be transparent  to the public. Patients are used to finding care based on proximity, word-of-mouth, and referrals from trusted physicians. (None of these are bad methods, by the way.)

Meanwhile insurers and public programs rarely pay for better outcomes, so they do not build networks that steer patients to quality. Paternalism pervades the entire system, where insurers and providers alike do not trust patients to shop for the best care.

Thus it is only the most long-term focused institutions that decide to become radically transparent. And there’s one that stands out above the rest: Cleveland Clinic.

The Ohio institution is already known for excellent care, especially in cardiology, for being a “well-oiled machine”, and for being an economic bright spot in the otherwise dreary environs of Cuyahoga County. (Sorry, as  Pittsburgher it’s hard for me to say nice things about the Mistake By The Lake.)

But something else Cleveland Clinic should be known for is its public outcomes reporting. Every year since at least 2005 Cleveland Clinic has published Outcomes Books on its Web site. For each clinical category it releases data on mortality, complication rates, and patient satisfaction. It also mails paper copies of these books to specialists around the country as a kind of transparency-marketing. No other hospital system comes close to reporting this level of detail about the quality of its care.

Continue reading “What Business Can Learn From Cleveland Clinic: How To Report Quality To The Public”

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When Florida voters elected Rick Scott back in 2010 they may have thought they were getting a health care expert. After all, his claim to fame was building the largest for-profit hospital company. Boy were they wrong.

The list of Scott’s public health missteps are vast–such as trying to gag doctors from discussing guns with patients, taking credit for refusing to perform abortions at his old company, trying to shut down a monitoring database that would keep pain pill addicts from getting more prescriptions, and pushing the sale of the state’s public hospitals to buyout funds to raise money to close the deficit.

But this latest one may be the most tragic. In March Governor Scott moved to close A.G. Holley hospital, a small 100-bed safety net institution specializing in tuberculosis. The Palm Beach County public hospital had operated for 60 years. Closing it saved only $5.4 million, which is what its costs were last year. Scott justified the closure saying that TB cases had dropped by 10% in recent years.

Continue reading “Unleashing An Epidemic: Florida Gov Rick Scott Shows The Folly Of Cutting Safety Net Hospital Funding”

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