Leading Change
HFMA Metropolitan New York ChapterJoseph A. Levi 52nd Annual Institute
Debora Kuchka-Craig, FHFMAHFMA National Chair andCorporate Vice President, Managed CareMedStar Health, Columbia, MD
March 10, 2011
The Crisis May Seem to Be Over . . .
…this month marks the one-year
anniversary of the Affordable Care Act
The recession─at least technically ─ has ended...
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. . .But the Long-Term Issues Remain
Exponential Growth in Healthcare
Expenditures
Need for Better Access to Insurance Coverage
Substantial Opportunities to
Improve Quality of Care and Patient
Outcomes
No Correlation Between
Expenditures and Quality
REFORM DRIVERS
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Kotter’s Eight-Step Model for Leading Change
Source: John Kotter, “Leading Change,” 1996
Create Urgency
Form a Powerful Coalition
Create a Vision for Change
Communicate the Vision
Remove Obstacles
Create Short Term Wins
Build on Change
Anchor Change in Corporate
Culture
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Create a Sense of Urgency
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Step 1
As We Navigate a New Phase of the Crisis
Emergency PhaseLeaders sought to stabilize the situation and buy time
Adaptive PhaseLeaders must tackle the underlying causes of the crisis and build the capacity to thrive in a new reality
Step Up:Healthcare Finance Must Take the Lead
Source: hfm magazine. August 2010.
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“Somebody has to do something, and it’s
going to be— and it has to be—you.”
Former Senator and Senate Majority Leader
Bill Frist, MDSpeaking at HFMA’s ANI: The Healthcare Finance Conference, June 2010
Form a Powerful Coalition
“Leadership has nothing to do with titles;
it has everything to do with, “Do you inspire other people? Do they want to follow you?
Do they want to be with you?”
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Step 2
Other Administrative Departments
Physicians
Nurses & Other
Clinicians
Other Entities Within Your
Health SystemPayers
Patients & Community Members
Finance
-Tom Atchison, author of Followership: A Practical Guide to
Aligning Leaders and Followers
Healthcare Coalition Success Stories
For more information, read HFMA’s Leadership e-Bulletin, available at www.hfma.org/leadership. “Transforming Revenue Cycle” (Providence Health & Services CA region): Oct. 2010 issue.
“Funding a Capital Project” (Beatrice Community Hospital/NE) : Dec. 2010 issue.“Redesigning Primary Care” (Fairview Health Services.MN): Nov. 2010 issue.
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A California healthcare system created core revenue cycle teams with representatives from 10 departments across all system hospitals.Improvement: $9.4 M
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Community banks and residents bought 38% of the $45M in bonds that a rural Nebraska critical access hospital used to fund construction of a replacement facility.
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A payer funded an initiative to make a Minnesota healthcare system’s primary care clinics more efficient and patient-centered. Physicians, nurses and other clinicians provided the ideas.
Create a Vision for Change
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Step 3
“The people who really succeed in this field have a vision. They have a high degree of motivation, and they are out to make things better—to do good and to change the world on whatever scale they can. They work hard, they have an end in mind, and they will acquire whatever skills and training and knowledge they need to get there. ”
Mary Stefl, professor and chair of the department of healthcare administration, Trinity University, San Antonio, Texas, and a consultant for the
Healthcare Leadership Alliance Competency Model
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Communicate the VisionStep 4
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Communicating the VisionSuccess Stories
For more information, read HFMA’s Leadership, available at www.hfma.org/leadership.Virtua case study : Spring/Summer 2010 issue.
Virginia Mason and Kettering case studies : Fall/Winter 2009 issue.12
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LAN Virginia Mason
leaders use this pyramid graphic to continually communicate and sum up the health system’s vision and strategic plan.
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Virtua focuses around the united goal of providing an outstanding patient experience. All improvement projects relate to one of the five points of the star.
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At Kettering, team members can easily see how close they are to achieving annual goals based on where the darts fall on the bulls-eye graphic.
Remove Obstacles
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Step 5
Leaders Will Confront Obstacles on Three Levels
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Resistance to change Risk aversion Need to develop new skills Need to relate differently to team members
INDIVIDUAL & INTERPERSONAL
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Incentive structure that does not reward risk-taking & change Lack of organizational nimbleness Limited resources for supporting change
ORGANIZATIONAL
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Divisive political differences Complex web of regulations Misaligned provider incentives
HEALTHCARE DELIVERY SYSTEM
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“. . . a leader needs to know and understand his or her people. You cannot lead without knowing the needs of your people—what drives them, what makes them do what they do. Once you understand some of the psychology of that, then you can give them opportunities to succeed based on their own psychology of success.”
Kerry Gillespie, FHFMA, vice president, operations, Community Health System, Inc., Brentwood, TN,
and a member of HFMA’s Tennessee Chapter
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Create Short-Term Wins
“A journey of a thousand miles begins with a single step.”
- Lao-tzu, Ancient Chinese
philosopher
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Step 6
“Don’t be afraid to start small.”
- Marty Manning, Advocate Physician
Partners
How it Manifests at the Hospital Level
Short-TermWin
Short-Term Wins Help Bridge the Gap to Long-Term Solutions
For more about Presbyterian Hospital’s navigator program, see the Oct. 2010 Leadership e-bulletin, available at www.hfma.org/leadership 17
Healthcare Delivery System Issue
In 2008, the U.S. spent $14 billion treating 115 million people who visit the ED for a non-urgent condition
Payers no longer want to pay ED prices for non-emergency care
New Mexico’s Presbyterian Hospital launched a patient navigator program that deferred 60 unnecessary ED visits within a month after its launch. The program is expected to save $10M - $15M over five years
Build on Short-Term Wins
“Leadership is invaluable to surviving Step 7. Instead of declaring victory and moving on, transformational leaders will launch more and more projects to drive change deeper into the organization.”
-John Kotter
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Step 7
Building on Short-Term WinsSuccess Stories
Floyd Memorial Hospital
For more information, see “The Value Equation” in the Nov. 2010 hfm, available at www.hfma.org/hfm..
Catholic Health East
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One-year initiative to reduce supply chain
costs by $1.1M
Small pilot program to prevent
readmissions
Two-year savings of more than $4M
Increased collaboration Enhanced quality of care Reduced waste
hospitalwide
Number of participating physicians nearly tripled
in two years
Avoided payment denials from direct readmissions
Increased physician satisfaction
Anchor the Changes in Corporate Culture
“Company cultures are like country cultures. Never try to change one. Try, instead, to work with what you’ve got.”
-Peter Drucker
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Step 8
Corporate Culture Success Stories
Read an interview with Advocate’s Lee Sacks, MD, in the Dec. 2010 hfm, available at www.hfma.org/hfm.
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Advocate’s balanced scorecard centers around health outcomes
40 percent of managers’ merit compensation increases are based on health outcomes
Their publicly available Value Report documents quality and cost achievements
Sharp aligns all strategic initiatives under six pillars of excellence
Leaders and staff come together at an annual All-Staff Assembly to recommit themselves to their mission
Sharp produces an annual TV documentary that shares real-life experiences with the community
Build on Finance Professionals’ Change Leadership Strengths
“CFOs are often better leaders than they think they are. They are good at setting goals, measuring results, and looking at variances.”
-Quint Studer, CEO & Founder, Studer Group
“The CFO is really in a role to help the various stakeholders understand how the pieces fit together.”
-Noblis Health Innovation Senior Principal, Paul Breslin
“When asked what role finance officers can play in transforming our healthcare system, David Walker said to remember what the ‘P’ in CPA stands for.”
-HFMA Board member Edward Giniat,quoting the former U.S. Controller General & CEO of the Peter G. Peterson Foundation
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