A growing number of physicians are stepping into leadership roles in hospitals and health systems. As a career health system executive, CEO and now strategic advisor to healthcare leaders, I’ve noticed a critically important difference in how those who really make an impoact view their role.
The transition from “The Old World” into “The New World” of healthcare is unprecedented and wrenching because all the rules are being rewritten. None of us has been where we are going and it will take all the best minds around us, working together, to figure it out.
Health systems are urgently searching for effective physician leaders to fill a litany of institutional roles: chief medical officer, VP of medical affairs, chief clinical informatics officer, chief of clinical operations … the job titles vary. This is driven largely from the shift to value-based payment by CMS. The clinical quality and patient safety metrics that now directly impact the system’s revenue cycle require a new kind of clinical redesign, one that non-clinical executives cannot lead effectively.
This represents what I call the First of Three Tables: doctors being invited to the executives’ Table to help redesign the health system.
In response to this need for physician leaders, executives traditionally looked to the medical staff leaders for help. Nearly every health system has experimented with some form of “physician leadership academy” to develop leaders from within the medical staff. These programs produce widely varying results, but they represent the Second Table: executives coming to the medical staff’s Table, trying to affect change and redesign inside the walls of the hospital through the mechanism of the medical staff.
In the Old World of healthcare, this made some sense. The name of the game was to refer patients to specialists who admitted them to the hospital, and the focus was on building service volume. The medical staff was the only forum to affect change.
But in the New World of healthcare, the name of the game is “population health management,” turning the focus to value, teamwork and coordination of care inside and outside the hospital. Medical staffs are ill equipped to manage such care.
This new reality of life in healthcare is spawning variety of new care delivery models, all under the rubric of “Integration”: hospitals and physicians working in teamwork. Generically, there are 2 methods of integration. One is the employment of physicians by hospitals (i.e., “financial integration”). The second is the creation of a sophisticated structure that enables independent physicians to “clinically-integrate.” Both involve the creation of a new business that assumes and manages financial risk through better-coordinated clinical care of a population of patients. In any Integration model, unlike the hospital or the medical staff, the new structure is some form of a joint-ventured business. It is the Third Table, where physician leaders and hospital leaders partner to run a new business in a new and interdependent manner.
Differing Worldviews Affect Our Table Manners
The people sitting around these 3 Tables are not always aware that the role of a physician leader, and his/her relationship to hospital executive partners, is distinctly different at each Table. Moreover, the basic worldviews of physician- and non-physician leaders could not be more different.
This difference was beautifully illustrated through the story told by a respected physician leader whose twin-sons left home on the same Saturday morning to attend different graduate schools.
One went to medical school while the other left for an MBA program. Both twins called home the next Saturday morning to talk to Dad about their first week in grad school.
The son at MBA school recounted his first morning in class: “I was introduced to five other members of my class who will be my study group. For the next two years my grades will depend on how well we work as a team. We spent the first week sharing the results of our personality assessments and doing team-building exercises.”
An hour later, the son at medical school called home. “This was the most interesting first week! On the very first morning I was introduced to my cadaver!” From Day One the message to the medical student is clear: it’s all on your shoulders, you are responsible and you cannot delegate it to anyone else.
Is it any wonder why autonomy is so important to physicians? Throughout their training they were perpetually drilled on being the expert and never assuming anyone else knew more about their patient than they did. I believe the best of American Healthcare is the result of this ruthless and uncompromising commitment to the personal accountability of the physician. But it represents a daunting obstacle to building the multi-disciplinary, coordinated care teams required in The New World.
“Table Manners” for both executives and physician leaders must blend together, animated by mutual respect for one another’s expertise and experience.
The First Table: Physician Leadership in a Hospital
Historically, executives managed hospitals, and medical staffs were granted privileges to practice there. This often created a contentious relationship. The New World of healthcare requires a fundamental redesign of the health system, and physician leaders engaged in this work can serve as “translators” between clinical and non-clinical staff to find better clinical ways to serve patients and generate the financial margins the system needs.
Chief Medical Officers become the first line of relationship between management and clinicians to set the agenda for advancing clinical quality and patient safety. It works well for hospital-based clinicians, such as hospitalists, nursing, and hospital-based physician services. But the autonomy of the independent physician members of the medical staff often resists the chief medical officer’s ability to drive change alone.
The Second Table: Physician Leadership in a Medical Staff
As hospitals are becoming accountable for the value-outcomes of their patients’ care, management turns to the medical staff officers for help. They become the target audience for physician leadership training. The dubious premise is that leaders on the medical staff can change the clinical behavior of their peers to benefit the hospital financially.
Eventually, everyone realizes that a medical staff is not well designed to change the clinical and business practices of its members. Its primary mandate is to set and preserve standards of quality for membership on the medical staff. Managing “pedigree” is what gets the attention - - proof of education, training and certification necessary to be privileged to practice in the hospital. Managing performance is limited to monitoring quality and patient safety practices and advocating for compliance with minimally required standards.
No independent physician would entrust the management of his or her private practice to the medical staff. Why? Because it was never designed to run a business. And in The New World of Healthcare, running a business that assumes the risk for managing the health of a population is exactly where we are going. A new approach is needed.
The Third Table: Physician Leadership in a New Business
What a medical staff cannot do is to manage the Business Performance of its members -- keeping referrals in-network, assuring high patient satisfaction, and following agreed-upon clinical protocols based upon best evidence-based practices. The real work of Population Health Management will require a litany of new business competencies that combine both the institutional resources of the health system and the collaborative leadership capacity of physicians:
• Linking EHRs from inpatient to ambulatory, with evidence based protocols
• Reduction of Inpatient Readmissions
• Managing cost and utilization of resources across the continuum of care
• Improvement of Patient Compliance
• Managing Clinical Quality Metrics by provider
• Increasing Patient Engagement
• Stratification of patients and targeted interventions to the right people
• Provision of outreach, ambulatory management of chronic diseases
• Connections with Community Based Organizations
Moreover, the physician members of this new business are typically a sub-set of those who compose the medical staff.
Think of a “tree house” that a few physicians have built, in partnership with the hospital, and they are looking down at those who were not invited to join the new club. The criteria for membership in the club go beyond the “pedigree” requirements for medical staff membership. They focus upon the business need and business performance of the physicians invited to join, and there is a “trap-door” in the clubhouse to jettison those who do not maintain high-quality performance. New entrants are selected by criteria that serve the business’ customers (payers, narrow networks, etc.).
The medical staff members outside the new business are accustomed to being entitled to “privileges” to practice, without an invitation, based upon the proper education, training and experience, and subject only to the minimally required community standards of care in their specialty! Conflict will certainly arise when the new business hangs out its shingle for the first time. And the physician and executive leaders of the new business, who often wear hospital and medical staff leadership as well, must be very clear and consistent in remembering which hat they are wearing when managing that conflict.
Because the new business, unlike the medical staff, can exercise the prerogative to choose who will sit at the table of running the new business, executives and physician leaders at The Third Table will be blazing new territory. Both groups will need to convert from their “expert” personas to “learners,” employing the curiosity, respect and emotional intelligence required to blend their business skills and clinical experiences to build the new business.
The Irreducible Ingredient for Success: Leadership
Creating structures to achieve legally compliant clinical integration are far easier to do than is finding and developing the leadership capacity required to actually implement and lead those new enterprises.
And without effective leadership - - particularly physician leadership - - the best strategies will flounder and fail.
Leaders rarely fail because they don’t know what to do. They fail because of how they do it. Behavioral competencies (emotional intelligence and relationship skills) rather than just technical competencies (knowledge of finance, operations, etc.) distinguish highly effective leaders.
Recent research reveals that the behavioral competencies needed by physician leaders are different from non-physician leaders. Collaboration, political acumen, motivating others and adaptability are behavioral competencies that are critical to the success of physician leaders, and are less evident among physicians than the general population. But they can be learned. And they are best learned in an experiential, rather than didactic, environment.
The winners in The New World of Healthcare will emerge wherever executive and physician leaders come together as equal partners around The Third Table with the right Table Manners. And effective physician leaders will be the key to their success.