Tag: Health system change

How Health Systems are Losing Contact with their Clinicians

Apr 18, 2025

By JEFF GOLDSMITH

Jeff wrote this article for Hospitals & Health Networks in the July 5, 1998 edition. He republished it this week on his substack calling it a “27th anniversary edition”. It’s an enlightening piece, but as you read it please ask yourself. What, if anything, has changed, and did anything get better?–Matthew Holt

It is hard not to be impressed by the sweep of change, both in the capabilities of the American health system and in health care organizations, over the last 20 years. In the space of a single generation, health services have evolved from a cottage industry into a substantial corporate enterprise. A breathtaking array of new technologies has been added to the hospital’s diagnostic and therapeutic capability. Hospitals have also managed-though not always gracefully-the transition to a more ambulatory and community-based model of care.

Through all these changes, the hospital has remained a central actor in the health system — and despite periodic political challenges, its economic position has significantly strengthened. But this success has come at a terrible price: the increasing alienation of professionals who are the lifeblood of health care and who bear most of the moral risk of the health care transaction.

As organizations have integrated structurally, they have disintegrated culturally. Not merely physicians, but also nurses, technicians, and social workers have seen themselves transformed into commodities and marginalized by the corporate ethos of health services. Professional discontent has intensified as physician practice has become increasingly incorporated into the hospital and as health systems have begun rationing care through captive health plans.

The gulf between managers and professionals — and even between senior and middle management — has widened into a chasm. At its peak financial strength and amid a record economic expansion, the health field has grown ripe for unionization. In fact, the labor climate among health professionals has become so hostile toward management that organizing health services could single-handedly revive the dying union movement in the United States.

Some of this tension is a by-product of the pressure to reduce the excess hospital capacity that health systems have inherited. To move from the present concentration of ownership to consolidation of excess capacity will inevitably mean workforce reductions or redeployment. The fact that little actual reduction in hospital workforce capacity has taken place so far doesn’t mean that the pressure to cut jobs and improve productivity isn’t real and tangible — or that it won’t increase in the future.

But the origin of workforce problems in hospitals and health systems runs deeper than the pressure to consolidate. In little more than a generation, management of hospitals has moved from a passive, custodial, and largely benign “administrative” tradition to an aggressive, growth-oriented entrepreneurial management framework.

Rube Goldberg Would Be Proud

Oct 31, 2023

By KIM BELLARD

Larry Levitt and Drew Altman have an op-ed in JAMA Network with the can’t-argue-with-that title Complexity in the US Health Care System Is the Enemy of Access and Affordability. It draws on a June 2023 Kaiser Family Foundation survey about consumer experiences with their health insurance. Long stories short: although – surprisingly – over 80% of insured adults rate their health insurance as “good” or “excellent,” most admit they have difficulty both understanding and using it. And the people in fair or poor health, who presumably use health care more, have more problems.

Health insurance is the target in this case, and it is a fair target, but I’d argue that you could pick almost any part of the healthcare system with similar results. Our healthcare system is perfect example of a Rube Goldberg machine, which Merriam Webster defines as “accomplishing by complex means what seemingly could be done simply.”

Boy howdy.

Health insurance is many people’s favorite villain, one that many would like to do without (especially doctors), but let’s not stop there. Healthcare is full of third parties/intermediaries/middlemen, which have led to the Rube Goldberg structure.

CMS doesn’t pay any Medicare claims itself; it hires third parties – Medicare Administrative Contactors (formerly known as intermediaries and carriers). So do employers who are self-insured (which is the vast majority of private health insurance), hiring third party administrators (who may sometimes also be health insurers) to do network management, claims payment, eligibility and billing, and other tasks.

Even insurers or third party administrators may subcontract to other third parties for things like provider credentialing, utilization review, or care management (in its many forms). Take, for example, the universally reviled PBMs (pharmacy benefit managers), who have carved out a big niche providing services between payors, pharmacies, and drug companies while raising increasing questions about their actual value.

Physician practices have long outsourced billing services. Hospitals and doctors didn’t develop their own electronic medical records; they contracted with companies like Epic or Cerner. Health care entities had trouble sharing data, so along came H.I.E.s – health information exchanges – to help move some of that data (and HIEs are now transitioning to QHINs – Qualified Health Information Networks, due to TEFCA).

And now we’re seeing a veritable Cambrian explosion of digital health companies, each thinking it can take some part of the health care system, put it online, and perhaps make some part of the healthcare experience a little less bad. Or, viewed from another perspective, add even more complexity to the Rube Goldberg machine.

On a recent THCB Gang podcast, we discussed HIEs. I agreed that HIEs had been developed for a good reason, and had done good work, but in this supposed era of interoperability they should be trying to put themselves out of business.

HIEs identified a pain point and found a way to make it a little less painful. Not to fix it, just to make it less bad. The healthcare system is replete with intermediaries that have workarounds which allow our healthcare system to lumber along. But once in place, they stay in place. Healthcare doesn’t do sunsetting well.

Unlike a true Rube Goldberg machine, though, there is no real design for our healthcare system. It’s more like evolution, where there are no style points, no efficiency goals, just credit for survival. Sure, sometimes you get a cat through evolution, but other times you get a naked mole rat or a hagfish. Healthcare has a lot more hagfish than cats.

I’m impressed with the creativity of many of these workarounds, but I’m awfully tired of needing them. I’m awfully tired of accepting that complexity is inherent in our healthcare system.

A Time For Revolutionary Thinking

Aug 13, 2014• 53

By JOHN HAUGHOM, MD

We need to design a system of health care that optimally meets the country’s needs while also being affordable and socially acceptable. Clinicians should be at the center of this debate if care delivery is to be designed in a way that puts quality of care before financial gain.

This challenge is too important to be left to politicians and policymakers. There is an urgent need for clinicians to step up, lead the debate and design a new future for health care. Placing professional responsibility for health outcomes in the hands of clinicians, rather than bureaucrats or insurance companies with vested interests, must be an ambition for all of us. We need to find the formula that meets the needs of the patients and communities we serve. A sincere collective effort by committed clinicians to design an effective system will lead to a health care system that has a democratic mandate and the appropriate focus on optimizing the outcomes patients and society need.

As clinicians enter the debate, they should keep three things in mind.

Promote the leadership role of clinicians

We need to help politicians and policymakers recognize the role of clinical leaders in shaping a transformed but effective health care system. Clinicians must redefine the debate so that it focuses first and foremost on patients and health outcomes. Cost effective care can and should be a byproduct of optimal care. Accomplishing this will provide a strong common purpose for efforts to address the challenges of designing outcome-based funding structures and improving access to care.