The University of St. Thomas

The Health Care Execution Challenge

By: Daniel McLaughlin

Published on: Tuesday, August 7th, 2012

This article was originally published in the spring 2012 issue of B. Magazine.

Health care organizations lag behind most successful businesses in executing high-quality business plans

In 2001, the Institute of Medicine published Crossing the Quality Chasm, a seminal work identifying the chasm between what is known about providing high-quality health care and what actually is being delivered. Ten years later, this chasm still exists and was a key factor leading to the publication of Make It Happen: Effective Execution in Healthcare Leadership, a book published by Health Administration Press, a division of the Foundation of the American College of Healthcare Executives.

As director of the Center for Health and Medical Affairs at the Opus College of Business, I long have been engaged in the health care delivery system throughout the Midwest and the nation. The focus of the center is to “support improvements in the leadership and management of health care systems through research, community outreach and the collaborative development of innovative professional and executive education programs.” Conducting research for and writing this book not only furthered the goals of the center but can, as a member of HAP’s editorial board notes, “advance health care leaders from developing a plan and letting it sit on the shelf to full and robust execution.”

The Challenge

The failure to execute is a common problem in many organizations but more so in health care. Barriers include an incredibly complex system, splintered leadership, strategies that vacillate between financial goals and patient care, and no external pressure strong enough to force change.

Effective execution, however, is the key to high performance for most of America’s successful corporations. Executing strategies effectively and quickly is well-known in the general business world, but it appears not to have crossed the chasm into the health care field. One way to bridge this gulf is to provide more effective education and training to health care leaders nationwide in the area of practical and efficient execution.

In 2009, during the Health Care UST MBA Washington, D.C., seminar, I had the opportunity to meet Dr. Carolyn Clancy, director of the Agency for Healthcare Research and Quality. A primary goal of AHRQ is to improve the processes needed to effectively move major clinical research findings from scientific literature to widespread use by the clinician.

AHRQ agreed to provide funding to the Opus College of Business to develop a new, effective execution curriculum for health care leaders and managers. For more than a year, I consulted with OCB faculty members on best business practices outside of health care and also visited some of the leading health care delivery organizations in the Midwest, including HealthPartners, Essential Health – Duluth, Marshfield Clinic in Marshfield, Wis., and Twin Cities Orthopedics to examine their systems for execution.  Read the rest of this entry »

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Initiatives for Responding to Health Care Reform

By: Editor

Published on: Tuesday, July 24th, 2012

By Noi Oan, Full-time UST MBA class of 2013

On June 27, I was excited to leave work a little early to attend the “Initiatives for Responding to Health Care Reform” event at the University of St. Thomas. It was one day before hearing the decision from the Supreme Court regarding the future of the Affordable Care Act. Curiosity and anticipation of what going to happen next was the main driver for me to come to the event.

The panel included Jim Eppel, chief operating officer of Blue Cross Blue Shield of MN, Brian Rice, the vice president of Network and ACO Integration at Allina, and John Herman, the president of Fairview Northland Hospital and Maple Grove Medical Center. Dan McLaughlin, the director of the Center for Health and Medical Affairs, moderated the event.

Each panelist brought to the table a unique perspective about the current health care system and the necessary moves to a better future for their organization. However, one theme arose as the common ground for all panelists: the necessity of patient engagement to improve health quality and control total cost of care. Read the rest of this entry »

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How much will my health insurance cost?

By: Daniel McLaughlin

Published on: Friday, June 29th, 2012

With the Supreme Court ruling the Affordable Care Act constitutional, attention is now shifting to the details of the law – especially how the individual market will function in the insurance exchanges.

I had the opportunity to work on the Clinton health reform plan in 1992–1993. As part of this work, the White House sent us to various groups to present the proposed plan. I usually spoke to provider groups. At the beginning of the presentation, I always asked the audience to “Please raise your hand if you know someone who is uninsured or who has difficulty getting health insurance.” Almost all the hands in the room were raised.

My guess is that this question would yield similar results today. Although it’s likely that many health professionals are already working on implementing sections of the ACA (such as ACOs, medical homes, reducing re-admissions, etc.), they may not have paid a lot of attention to the individual market insurance details. Here are some basics to remind us of the details and some resources to share with any friends who are uninsured.  Read the rest of this entry »

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It’s Definitely a Roberts Court

By: Editor

Published on: Thursday, June 28th, 2012

Senator Dave Durenberger shares his reaction to the Supreme Court’s ruling on the Affordable Care Act and thoughts on where we should go from here. This post was originally published on his blog, NIHP.org.

In plain English:

Regardless of the spin that follows, Obamacare is the law of the land.  From now on it is open to criticism, repeal, or reform.  But it will be implemented and reform will require both political parties to find ways to cooperate.  It is a time now for the leaders of the health care industries in America and the leaders of America’s job creation community to step up to what should no longer be a political plate and be heard on policy implementation.

The president himself should take the first step to the plate and speak to the importance of the role of the law and the national government, not in delivering health care, but in shaping the payment policy which rewards a healthier people, healthy communities, and a value-oriented health care system.  This shouldn’t start in Washington but rather in communities across America. Read the rest of this entry »

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Health Care Technology Impact: Cloud Computing

By: Editor

Published on: Thursday, June 14th, 2012

By Rex Njoku

As a final year student of Health Care UST MBA cohort 18, I have been challenged with in-depth knowledge regarding the current health care system and the various problems that still exist, such as the rapidly-increasing health care costs, number of uninsured individuals, questionability of the ongoing health care reform, shortage of primary care physicians, etc. The new age of increasing technological advancements, though phenomenal and advantageous, has also brought with it more complexity and problems to resolve, most especially in the health care industry.

A key part of the health care reform involves the use of technology to address a number of health issues such as access, value and cost. Hospitals, if not fully transitioned yet, are now transitioning from paper records to Electronic Medical Records (EMR), a digital and portable version of the medical records used in health care systems that allow storage, retrieval and easy modification of records. To support health reform’s goal of collecting data on providers, determining what treatments are improving outcomes, linking care to payments, determining quality measures, etc., computer support systems are being used everywhere. Increased medical knowledge has brought about more technological advancements in treatment and devices that require computer support. Increases in medical/research data has brought about the need for highly complex computer support systems to analyze and retrieve information. The increase in patient-centric care and social media popularity has also required health care systems and providers to become more technology-savvy. The cloud, social, mobile, consumer, apps, enterprise technologies and more are needed, more than ever, to support these technologies.

The Cloud

Cloud computing enables computers and various other devices in different geographical locations to access shared computer services or applications over the “cloud” or internet rather than a local environment. Cloud technology is at the heart of health care’s transformation and health care industries are now, more than ever, utilizing various cloud technologies.. With tablets and EMRs replacing paper medical charts, private clouds are now being used to access medical records and promote information sharing among medical professionals. Cloud health care services are also currently being used to solve a wide range of health care challenges, such as fraud, remote diagnostics and patient CRM.

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A Focus on Women’s Health

By: Editor

Published on: Friday, June 8th, 2012

This article was originally published in the spring 2012 issue of B. Magazine.

Dr. Donna Block ’05 M.B.A. has opened two women-centered clinics that provide care to women, by women

By Lisa Guyott

Women’s health issues have traditionally been narrowly defined as those specific to the female anatomy and to issues surrounding reproductive health. As late as the early 20th century, a large portion of health concerns brought forward by women were attributed to the catch-all diagnosis of “hysteria,” an ailment which had more symptoms than the common cold and could potentially be cured by bed rest, bland food, seclusion and, most importantly, refraining from taxing tasks such as reading or writing. Laundry, housekeeping, child care and cooking were still permissible.

Today, a rapidly growing number of organizations and practitioners include in the definition of women’s health not only reproductive health, but social and emotional well-being. As defined by the World Health Organization, the topic of women’s health includes biological differences between men and women as well as the study of those illnesses unique to women, more common or serious in women, with distinct occurrences in women, or with different outcomes or treatments in women. Since the 1980s, research on gender differences in health and disease has influenced new treatment and prevention of serious illnesses, including heart disease, stroke, lung cancer and depression.

Clinic Sofia in Edina subscribes to this revised and expanded definition. Launched in 2004 by Dr. Donna Block ’05 M.B.A., the clinic’s mission is to “nurture a community of confident, healthy women,” a mission taken seriously not only by Block, but by the all-woman staff and the clinic’s clients.

The clinic’s name evokes Sophia, the Greek goddess of wisdom, fertility and nurturing. Its waiting room is the first and most visible sign of this mission. Bearing a greater resemblance to a 19th-century literary sálon than a medical office, it is furnished in comfortable couches and lounge chairs. A large bowl of chocolates sits on a side table and soft music issues from a portable CD player. The waiting room also is an exemplar of the clinic’s – and Block’s – approach to business: a carefully crafted, deliberate implementation of disciplined intuition.

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Capital Investment Decisions in Health Care – Five Questions for Prof. Southard

By: Editor

Published on: Thursday, May 24th, 2012

Peter Southard

We recently talked with Peter Southard, Ph.D., an assistant professor of operations and supply chain management, about his research on capital investment decisions in health care.

Q: Why did you decide to examine capital investment decisions in health care?

A: Increasing competition and artificially-imposed price controls in health care are forcing caregivers to rethink how they manage their delivery systems. Health care delivery systems must be able to provide extremely high-quality care at reasonable costs. Any variation in the systems and the processes needed to deliver the health care “product” serves to increase the costs and reduce the quality of that health care. The variation does so, partly, by increasing the time needed to deliver the service. One of the primary goals of health care must be, then, to identify and reduce the root causes of variation in its processes and systems.

This need is also true in all decision making processes in which variation, or lack of a consistent framework by which to make decisions, can lead to not only inefficiencies but also costly errors that reduce the hospital’s competiveness and its ability to deliver cost-effective care. One of the decisions impacting a health care system’s cost is the make/buy decision: when to outsource a process and when to maintain the process in-house. If the decision is to “make,” then the next decision is a capital investment one. Our research looks at adapting a framework from another area of business to this decision situation. We apply a Six Sigma quality tool, the Technology Function Deployment (TFD), to develop a practical framework that hospital managers can use to make consistent and effective decisions regarding capital investments versus outsourcing.

Q: Why is this topic of interest to you?

A: Professor Sameer Kumar and I have been doing quite a bit of research in this area of process improvement in health care. While researching our last paper, we noted the lack of uniformity in the laboratory equipment purchasing decisions of our subject hospital and decided to try and apply this approach to standardizing that process.  Read the rest of this entry »

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What Would You Do? UCare’s Ethical Dilemma

By: Editor

Published on: Wednesday, May 9th, 2012

This post is republished from the Opus Magnum blog. The story was originally published in the Business Ethics Exchange, the newsletter from the Center for Ethical Business Cultures. Let us know your opinion in the comments.

By Ron James

“No good deed goes unpunished.” That’s the message Nancy Feldman, president and CEO of UCare gave to the commissioner of Human Services for the State of Minnesota as her organization returned profits (surplus gains for a nonprofit) to the state. Speaking to a packed house at the 12th Annual Minnesota Business Ethics Awards co-sponsored by the Center for Ethical Business Cultures, Feldman provided insights into her organization’s ethical culture, an ethical dilemma UCare faced and the resulting aftermath following its decision to return $30 million of gains to the State of Minnesota.

UCare is a unique health plan serving 225,000 low-income families and children, and Medicare and Medicaid members in Minnesota. Of its $1.7 billion in revenue last year, 40 percent came from state government and 60 percent from the federal government, placing government in the dual role of regulator and purchaser of its services. As the leader of this mission-based nonprofit, Feldman personally meets with all new employees to plant the seeds of the UCare mission and values into their hearts and minds. Integrity is the first key value.

Earlier this year, the value of integrity was placed in the spotlight. Due to a number of factors, including better efficiencies, improving the health care of its members, healthier people coming into the plans because of the recession and decreases in health care utilization, UCare realized strong “earnings after expenses” gains. This resulted in $30 million beyond the “two months reserves” it normally sets aside. Stimulated by a board of directors discussion, UCare considered a range of options to utilize the additional gains. But given the State of Minnesota’s $5 billion budget shortfall, UCare ultimately decided to return it to the state’s treasury.

Despite UCare’s best intentions, many voices emerged with a variety of agendas attempting to use the contribution for a variety of purposes. Feldman explained that given their unique relationship with the state government as a funder, this was the right thing to do for UCare and that this may not be applicable to other situations. But once started, the events took on a life of their own.  Read the rest of this entry »

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Segmenting the Future of Health Care

By: Editor

Published on: Friday, May 4th, 2012

By Cindy Lorah, Associate Director, Health Care UST MBA

Last Tuesday, the University of St. Thomas hosted the Minnesota Chapter of the American Marketing Association’s final Health Care Special Interest Group event of the program year. Bart Reed of UnitedHealthcare Medicare & Retirement and Michael Brousseau of OptumHealth shared how their segmentation work is driving business growth throughout their organizations.

Methodology

The UHC Medicare & Retirement Group wanted to create a shared perspective on consumers over age 65 that would provide a common language in how they talk about consumers; a common approach to targeting; a clearly defined customer value proposition; a clear understanding on where growth opportunities lie; and a focus for messaging, innovation, product development, etc. They developed a methodology to answer the following questions:

  1. Which consumers and segments present the most attractive opportunities for growth?
  2. What are the current, latent, and emerging needs of attractive consumers and segments?
  3. What is the total value proposition – benefits, services, pricing, communications – they should deliver to drive differentiation and growth?

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The Affordable Care Act Passed. Now What?

By: Editor

Published on: Monday, April 23rd, 2012

This article was originally published in the spring 2012 issue of  B. Magazine. 

In 2011, two Opus College of Business faculty members launched a study of more than 70 health care organizations. The outcome will assist these organizations in meeting the demands and challenges of a new, more transparent and more competitive market.

By Jack Militello, Ph.D., and Mick Sheppeck, Ph.D.

On March 23, 2010, President Obama signed into law the Patient Protection and Affordable Care Act. On March 30, 2010, the Health Care and Education Reconciliation Act of 2010 was signed into law. The two laws are collectively referred to as the Affordable Care Act (ACA). The ACA includes a wide variety of provisions designed to provide more health care choices, to enhance the affordability and quality of health care for all Americans, to hold insurance companies more accountable and to lower care costs; however, the ACA does not give direction to health care-related organizations as to how to implement its legislation. Implementation is the strategic challenge of every health care provider.

Two strategic theories underlie the expectations set by the ACA. The first is that, with the proper incentives in place, costs can be contained as better service is provided. The second is that a fully functioning and competitive market for health services will achieve the goals of the legislation. Any strategic responses to these theories of funds-flow and markets have to be taken in relationship to each other and in the context of the broader health care system.

A discrete response to the administrative-pricing directive of the ACA is quite simple: cut costs and retrench to meet pricing constraints while seeking new venues to gain revenue. The former is currently undertaken through a number of initiatives accepted within the industry. These include analytically based cost containment, operational-improvement protocols and employee-motivation programs. These initiatives are necessary but not sufficient to strategically succeed in the reform environment urged by the ACA and must be teamed with revenue-generating initiatives. The latter demands the application of each of these tools with the addition of an engagement with competing business models, potential partnerships, community and governmental relationships, generational-culture differences, and the power of the consumer. In short, it demands a systems perspective on a cash-flow strategy that addresses both costs and markets.

The health care delivery system offers myriad business models, ranging from nonprofit services through return-on-investment models for publicly traded companies. The core of the health care delivery system is the patient-provider relationship, but it then takes in all the suppliers of goods and services that support the core interaction. Each model is driven by a mission that aligns itself to the health care system as a whole. But first an internal organizational alignment of mission to the management of costs and markets has to occur.

An organization’s purpose should express its vision, either implicitly in its goals or explicitly in a statement of mission. Mission statements are often high-minded but lacking in connection to the actual operational management of the organization’s assets. A good mission should state long-term goals and determine how to measure progress toward reaching them, as well as providing the organization with a business model that defines a distinct competitive advantage. That advantage should be expressed in the value it provides to its customers, patients and stakeholders. An analysis of the alignment of mission with organizational operating factors would equip any health care provider with insight as to how to approach its markets.  Read the rest of this entry »

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