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How to Meet These Challenges

These challenges are formidable, but they can be met and resolved by implementing some serious changes to the way we do business in health care today. Health care is one of the few remaining sectors of the U.S. economy that still use a bureaucratic organizational structure. Most businesses in the for-profit sector have realized that in order to continue to prosper, foster innovation, and retain talented workers, they need to change their strict bureaucratic method of management to a more organic structure where workers are encouraged to be creative and innovative and where trust can develop. This change in organizational design is slowly but surely making its way toward the health care sector. Some of the major changes that need to be made in the very near future in order to solve many of our health care problems include the expansion of health education, leadership replacing management, the encouragement of innovation by employees, and provision of the necessary incentives to make all these changes successful.

Houle and Fleece (2011) point out that at least part, if not all, of the current health care system is broken. The problem has become one of gaining agreement from the various stakeholders about what needs to be done to fix this broken system of health care delivery. There is indeed a paradigm shift coming in how we think about health care, how we deliver health care, and of course the economics of health care. These necessary changes in health care services delivery must occur sooner rather than later.

Invest in Health Education Programs

It seems obvious that the current focus in health care delivery of attempting to cure all diseases is not working. The major problems found in the current health care system – cost escalation, lack of access to care, and poor health levels among the population – would all go away if we remained healthy rather than becoming ill. In fact, as previously mentioned, the leading cause of morbidity and mortality in the United States is no longer curable communicable diseases but rather the incurable chronic diseases. This silent epidemic of chronic diseases cannot be treated but can be prevented if we as a nation are willing to invest sufficient resources in health education and health promotion programs designed to prevent people from acquiring these diseases in the first place.

Almost all the money spent on health care every year in this country is designated for finding disease and then curing the disease when found. The problem with this strategy is found in the fact that once one acquires a chronic disease there is no cure but only the management of the chronic disease in an attempt to prevent complications from it. Fortunately, there is another strategy that can be used to deal with the epidemic of chronic diseases. This strategy will take a long time to develop, implement, evaluate, and improve, but given time and resources it will work. Our health care system must move a large amount of resources from disease detection and attempted cure to health education and disease prevention. Health education is also a valuable strategy for the prevention of the complications that usually arise from having a chronic disease for a long period of time.

The idea of expanding health education and health promotion programs is not new. It has been a core function of public health departments for years. The problem has been that public health departments have never been allocated the necessary resources to make health education programs work. Why have health insurance providers not educated their members about the value of receiving health education and preventing chronic diseases from occurring in the first place? Doesn't it seem logical that if health insurance companies used their resources up front to prevent disease then they would not waste their resources attempting to cure the incurable chronic diseases later in life? The answer to these questions is found in the etiology of chronic diseases. These diseases take decades to develop and produce expensive medical complications. Because these complications usually occur in older individuals, these patients will most likely have moved into the Medicare system where they become the government's problem. There is simply no real monetary incentive for health insurance companies and employers to care much about keeping the population free from illness. Unfortunately, this attitude is costing the country as a whole enormous amounts of resources as the population grows older.

Barnes, Kroening-Roche, and Comfort (2012) point out that the new health law is requiring a strong primary care foundation for patient care. They also point out that the availability and use of patient-centered medical homes discussed in the previous chapter is growing across the United States; these medical homes are focused on promoting good health rather than just treating disease. They recognize that 40 percent of premature mortality is determined by individual health behavior and 15 percent by societal factors. Therefore, in order to improve the health of the population, more attention must be paid to preventing high-risk health behaviors like tobacco use, physical inactivity, and obesity. This will certainly result in health education becoming a vital part of primary care.

Engage in Leadership, Not Just Management

The most important skill necessary if we are to solve the many problems facing the health care industry and reform that industry is leadership. Without strong leadership from both formal and informal leaders in health care delivery, there will be little if any success. The current problems found in our health care system are far too large to be solved by management alone. The major challenges in health care today require vision and health care workers empowered to be creative and innovative in designing solutions. According to Hamel (2012) our large problems today demand radical new solutions, forcing organizations to change in ways that have no precedent. This is where our entire health care industry finds itself today. Change is coming so rapidly to health care organizations that current management processes are incapable of turning that change into opportunities for the organization.

Bureaucracies are designed to work slowly within rules and regulations, while changes in function or process meet with extreme resistance from those in control. Although bureaucratic structures are being rapidly replaced with decentralized management systems in most successful organizations, a few sectors in our economy, like health care, have retained a rigid bureaucratic structure. Health care management systems were never designed to deal with rapid change but rather to keep the organization running efficiently. This is especially true in bureaucratic organizations that are micromanaged by bureaucratic managers. These managers are not interested in the improvement of health care delivery, only in protecting their power and influence, which is found in their management position. Radical change brought about by innovation threatens their power base so they usually block change with their position power.

There is no magic bullet available to deal with the many challenges facing the health care sector of our economy. It requires creativity and innovation to turn the waste found in health services delivery today into efficient and productive changes designed to improve the health of our population at a price that we can all afford. Better management of the scarce health care resources is required, along with leaders who provide a vision and a plan to achieve that vision. Leaders must have a strategy to empower all staff in health care organizations to spend the majority of their time improving the quality of the services that they deliver every day. This is going to require the development of trust between the health care leader and those who actually deliver the services to the health care consumer. This process of building trust between leaders and followers begins when the leader of the health care organization recognizes that the most important resource found in the health care facility is the people providing the health services.

The enormous challenges faced by the restructuring health care sector require leaders with superb communication and conflict management skills, motivational expertise, and the ability to build and sustain a strong positive culture within the health care organization. These skills can help to release the innovative spirit throughout the organization, empowering all employees to improve service delivery on a daily basis. Just as the employee with innovation skills grows by using these skills, the leader grows by constantly using his or her leadership skills. With both the leader and the empowered employees growing in their positions, the health care facility should grow and prosper. The answers can be found in the people who work in all parts of the health care delivery system. These are the people who first recognize the problems and are also most likely to understand how to solve them.

Gross (2012) argues that it is not productive to use the enormity of the challenges that we face as an excuse for doing nothing. The most important attribute that we as a nation can bring to solving the challenges in health care is a desire to try new approaches and to adapt innovations to the way the business of health care services is conducted. This is where the vision of the leader, complemented by the talent of the empowered workers, comes into play.

O'Callaghan (2010) comments that in an organization facing a crisis, one of the most important things the leader can do is to gather numerous viewpoints on the causes of the problem and encourage a discussion of the various opportunities that are present for change. Jennings (2012) points out that all businesses must adapt to change or accept the fact that they are slowly going out of business. He finds that failing businesses usually waste valuable time blaming others for their failures rather than dealing with the root cause of their problem, their inability to respond rapidly to a changing environment. This is exactly what is happening in health care today. There needs to be radical change in the way health care is delivered, and we are all running out of time to address this change. Champy and Greenspun (2010) point out that many of the processes currently used in health care services delivery are in dire need of reengineering but have been ignored. If these health delivery processes were reorganized, they could maximize their quality, safety, and convenience while reducing costs of operation.

Leinwand and Mainardi (2011) argue that capable leaders are inspiring. They can provide leadership and empowerment to a group of creative individuals who understand why the organization has achieved success.

Vanourek and Vanourek (2012) point out that organizations that have developed a healthy culture have been able to achieve improved productivity, staff retention, increased profitability, and much better relationships with customers and suppliers. These authors use the Mayo Clinic as proof of this improved relationship and to illustrate the role of leadership in the daily improvement of the health of the organization's culture. The Mayo Clinic prides itself on its team approach to health care delivery. This is achieved through an emphasis on communication among all levels of the organization, along with collaboration among staff and patients on all medical decisions.

Create Innovations in Health Care Delivery

Florida (2011) states that creativity involves distinct habits of mind that are often stifled by the design of the organization. The great strength of a capitalist system is found in the entrepreneur who revolutionizes the pattern of production. All too often, as the organization grows because of a successful entrepreneur who has passion for the product or service and the confidence to take the risks associated with creativity, a bureaucratic system of management is installed to help with the growth process. Then, for efficiency and effectiveness within the growing organization, rules and regulations are instituted, which in turn all but eliminate the creativity of the organization. This is exactly what has happened to the health care sector of our economy.

The productivity of health care resources must be improved if we are going to be successful in dealing with the many challenges we face in the delivery of health care services. In order to improve health care resource productivity, we must be able to increase the availability of health care services at a lower price. This requires the development and implementation of innovations in health services delivery that are currently being blocked by bureaucratic organizations and the micromanagers that they employ. These innovations are also being blocked by powerful interest groups who resist changes that affect their members' income by supporting legislation that eliminates creativity and competition in the health care industry.

The way we receive medical care is in dire need of innovation. Consumers of health care services are demanding convenient, less expensive, quality health services that are delivered to them without their having to waste a large amount of their limited time filling out forms and waiting for care. According to Goodman (2012) this consumer demand has resulted in the growth of urgent care clinics and walk-in clinics. These innovations in health care delivery post their prices and usually offer excellent quality of care in a timely fashion. Retail clinics are a form of ambulatory care found in retail establishments like grocery stores, pharmacies, and many other types of stores. In a recent study Mehrotra and Lave (2012) found that the number of retail clinics is rapidly growing and these clinics are becoming a part of the U.S. health care delivery system. These authors have discovered a fourfold increase in retail clinic visits from 2007 to 2009. These clinics provide a desired service at a transparent and reasonable price. They offer after-hours availability, are usually conveniently located, and have short waiting times. The demand for retail clinics also reflects the increased demand for primary care because of the shortage of primary care physicians. The need for primary care will increase in the future as many of the uninsured become insured as a result of the Affordable Care Act now that it is being fully implemented.

retail clinics

Basic care walk-in clir located in drugstores other retail stores.

Omachonu and Einspruch (2010) point out that information technology has become the most important component of innovation in health care. It has the ability to reduce the costs of health services delivery while improving the quality of care. Even though the federal government has put monetary incentives in place for providers of care to adopt technology in their practices and hospitals, the adoption rate of this technology is still moving at a frustratingly slow pace. This innovation is a critical requirement that must be fulfilled if we as a nation are ever going to deal with the challenges we face in health care, especially cost containment and quality improvement. We must first restructure the health care organization so that it encourages not only innovation but also disruptive innovation, which replaces older technologies with newer and value-added ideas.

Wagner (2012) argues that innovators require a skill set that includes curiosity, imagination, perseverance, critical thinking, a willingness to take risks, and the ability to accept failure. These skills are present in many individuals throughout health care organizations, no matter what their position or their formal education or training. The secret is to allow individuals with innovation skills to continue to develop their skills by using them. According to Chesbrough (2011) successful innovation efforts require changing the role of both the employee and the customer in the innovation process, thus empowering both groups.

The development of new products and services is the function of the entrepreneur who visualizes opportunities, pays the up-front costs associated with bringing the service or product to market, and ultimately takes all the market risks. The missing ingredient for success in innovation in health care delivery has been the entrepreneur. According to Miniter (2012) individuals with entrepreneurial skills are all around us and are well aware of the many opportunities that are present in the health care industry. Therefore the question that needs to be answered is, how can we motivate these prospective health care entrepreneurs to channel their much needed skills toward solving the challenges currently faced by our health care industry?

Make Incentives Matter

Most incentives provided in the health care industry are dedicated to rewarding the players who have the most power and influence, but unfortunately these incentives do not improve the health of the population. Miniter (2012) points out that incentives matter in almost any attempt that is made to improve the chances of goal achievement. He offers the example of a rent-seeking society, where individuals and institutions spend a great deal of time attempting to increase their profits through politics rather than value creation. This rent seeking is evident in almost all the health care legislation that gets passed and implemented by our government. It is not proposed and ultimately turned into law by the people that it affects but rather it is a reflection of powerful health care providers and their lobbyists. They lobby government to pass legislation that hurts competitors while rewarding them with increased profits. This rent-seeking motive tends to reward nonproductive efforts and to discourage the very innovation required by our entire economy but especially the health care sector.

rent-seeking society

A society where individuals seeking profits put more emphasis on political influence than on creating value with innovations.

The current incentives in health care delivery encourage wasteful testing, unnecessary medical procedures, hospitalization when ambulatory care would work better, and often the unnecessary utilization of a hospital emergency room. These incentives must change or we are never going to get any semblance of the best way to deliver quality health care at a reasonable price. There's also a need to start providing incentives for preventive health care delivery that starts with health education in elementary school and continues right through the workplace. The only way to stop the epidemic of chronic diseases is to prevent high-risk behaviors from occurring in the first place. This will only happen once incentives are in place for the health care system and the nation as a whole to work together to prevent disease rather than attempt to cure disease after it has occurred. A very good example of an individual incentive would be a reduction in the insurance premium for various preventive health choices, such as participating in a company-sponsored wellness program. Miniter (2012) argues that the incentives found in a market provide individuals and companies with reasons necessary to choose productive activities, and so another example is found in the way we pay physicians for health care. The current method of payment is fee-for-service. The more activities produced by the physician, the larger the amount of money paid to the physician. The result of this incentive is a large number of activities, some of which are unnecessary. A better way to pay physicians would be for positive health outcomes.

 
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