Masters Series Leadership Program

November 1, 2012

Presented by: Doug Strong, CEO, University of

Michigan Hospitals and Health Centers

Outline

• UMHS Overview

• Importance of leadership

• What is our job in health care?

• Balance of excellence

2

University of Michigan Health System Synergies of Mission

3

Research Education

Patient Care

• Basic and clinical research by faculty develop reputation, processes and techniques that attract patients

• Undergraduate and graduate health sciences training provide an important pipeline for recruitment

• Patient care provides subjects for clinical and health services research

• Patient care provides the margin to support research 3

Confidential – Exempt from FOIA 4

Clinical Programs• Michigan Market Leadership (Children

& Women’s, Cancer, Transplantation)• High-Complexity Patients• Destination Programs

Novel Delivery Models• Clinical Partnerships• ACO/Population Management

Ideal Patient Care ExperienceIntegrated Research• High-Potential Scientific Intersections• Discovery Research Into Clinic • Enabling Research Infrastructure• Build and Maintain Research Workforce

Basic ScienceNovel & Targeted

Diagnostics / Therapeutics

Clinical Delivery System

Future of Health Care

Translational Medicine

Enterprise-Wide Learning Architecture

Diversity/Health Equity

Institutional EnablersIntegrated Information Technology, Funds Flow/Faculty Effort, Payer Contracting

Our Strategic Platform

Confidential – Exempt from FOIA

5

• Research and education investments are highly dependent on ability to generate clinical margins

• Clinical margins are dependent on distinguishing ourselves with robust research and education programs

Formula For Success

ClinicalMargin

(+)

Research(investment)

(-)

Biomedical & Medical

Education(investment)

(-)

Philanthropy (+)

Investment Income

(+)

Cash to Invest in

our Future

Importance of

Leadership

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What is Leadership?

• Definition 1:

Influencing, motivating, and enabling others to achieve the goals of the organization

• Definition 2: – Explaining the present– Communicating with & learning from the organization– Creating a vision for future – Implementing it

• The more leaders, the better.

20,000 problem solvers are 20,000 leaders

• Importance of leadership to employee engagement

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What is Our Job?

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What Is Our Job?

Before Health Care Reform: Improve quality and efficiency simultaneously

During Health Care Reform: IMPROVE QUALITY AND EFFICIENCY SIMULTANEOUSLY

What does reform mean?

What is Our Job?

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CMS Innovation Center Mission Statement:

• Better Health Care

• Better Health

• Reduce Costs

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HealthINFLATION News September 30, 2012

Metropolitan Areas Compared to U.S. City Average, August 2012

Note: MI has lowest Employer Sponsored Insurance Premium Growth In U.S. from 1999-2009 Not all Metropolitan Areas are reported each month. When August 2012 data are not available July 2012 data is used.

Michigan Dashboard on Health Care Quality Compared to All States

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The graphics on this page are summaries of measures reported in the National Healthcare Quality Report (NHQR) for Michigan. Above is a summary of over 100 measures in the NHQR reported at the State level, and below are graphics describing specific types of care, settings of care, and care in clinical areas. Select the graphics to find the underlying measures.

Overall Health Care QualityAverage

Strong

Very Strong

Weak

Very Weak

= Most Recent Data Year

Performance Meter: All Measures

- - - - - ► = Baseline Year

- -

- -

- -

- ►

MI Rank: 20

Types of Care

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Each graphic shows a State's balance of below average, average, and above average measures compared to all States reporting such data in the United States. The graphics have five categories: very weak, weak, average, strong, and very strong. This State's performance for the most recent data year is described by a solid arrow or solid triangle; a dashed arrow or hollow triangle describes the baseline year. A missing arrow or triangle means there were insufficient data to create the summary measure.An arrow or triangle pointing to "Very weak" means all or nearly all included measures for a State are below average within a given data year. An arrow or triangle pointing to "Very strong" indicates that all or nearly all available measures for a State are above average within a given data year.

ntive Measures

Acute Care Measures

Chronic CareMeasures

Very Very Weak Weak Average Strong Strong

PreventiveMeasures

Acute CareMeasures

Chronic CareMeasures

Types of Care

= Most Recent Data Year

= Baseline Year

MI Rank: 17

MI Rank: 8

MI Rank: 32

Variation in Health Care: The Key to “Bending the Cost-Curve”

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• Variation in cost

• Variation in quality

• Variation can be found everywhere

– Comparing states

– Comparing areas within states

– Comparing practices within a community

– Comparing physicians within a practice

• Reducing variation and “Lean Thinking”

are closely related

Appropriateness

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Definition: Appropriateness is providing allof the care that is necessary and none of the care that is not necessary.

Goal statement for bending the cost curve: Reducing variation to the point of appropriateness.

Examples of Inappropriateness:

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On the low side:

• CHRT Cover Michigan Survey: 2011

Half of respondents with Medicaid found getting an appointment with a specialist

either “very difficult” or “somewhat difficult”

On the high side:

• MI has substantial regional variation in utilization(e.g., back surgery, angiography, percutaneous coronary intervention)

Drivers of Soft Landing

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Perspective of :Institution MI Health Society

Care Industry

Doing more with more?

Doing more with less?

Doing less with less?

Maximize vs. Optimize

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Maximize Optimize

Present Future

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1

2

3

4

5

6

7Preparing for the Future

Employer of Choice

Benefit to the Community

External Presence

Financial Success

Quality and Safety

Provider of Choice

Balance of Excellence

Financial Success

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Quality / Safety

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• QUALITY CARE: Surgical Site Infection rates

Targets/Results: Quality of Care

Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 Jul-11 Jan-12 Jul-120.0

1.0

2.0

3.0

4.0

5.0

Rat

e p

er 1

00 p

roce

du

res

Outpatient

Inpatient

Inpatient procedures include: Thoracic Surgery, Vascular Surgery, C-Section, Ortho Spinal fusions, total hip arthroplasty, total knee arthroplasty, total abdominal hysterectomy, VP shunts, Colectomy, Craniotomy, and Peds Cardiac Surgery, Peds Spinal fusion, Peds VP shunts , Peds Gen Surg, Peds OMS, Peds Ortho, Peds Oto, Peds Plastics, Peds Uro, Peds Txp, Peds Ophthy.

Outpatient procedures include: KEC Ophthy, LSC & EAA

FY00FY01

FY02FY03

FY04FY05

FY06FY07

FY08FY09

FY10FY11

FY12

30,000

40,000

50,000

60,000

70,000

80,000

90,000

100,000

110,000

Adjusted Cases

Adjusted Discharge Cases Over Time

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CAGR=5.0%

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Target: Patient satisfaction mean scores on “care experience”

Provider of Choice: Target/Results

Employee Willingness to Recommend One’s Department - Mean Index

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Desired Trend

D.A.R.T. Rates (Days Away, Restricted or Transferred)

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2002 2003 2004 2005 2006 2007 2008 2009 2010 2011Year

0.0

1.0

2.0

3.0

4.0

5.0

6.0

5.24.8

4.6

4

3.43.3

3.12.8 2.7

2.5

DART rate by calendar year

Benefit to the Community

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Grand

Tot

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50

100

150

200

250

300

350

400

2007

2008

2009

2010

2011

2012

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External presence: Where Our Patients Come From

• UMHS is only statewide provider

• 1/3 Local and Under our Control (competing directly)

• 2/3s From Referrals (competing for referrals)

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External presence: What is At Risk for UMHS?

• Various aspects of health care reform maydisrupt existing referral channels

– ACO’S– Bundled payment– National centers of excellence

• Consolidation in MI market of physicians and also of hospitals

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Now

ImprovingWhat We Do

Convincing Others of Our Value

Developing Partnerships

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Necessary Future

Improving What We Do

Convincing Others of Our

Value

NOTE: Size of circles indicates level of importance, not level of effort.

Developing Partnerships

Preparing for the Future

• Strategic Planning and Deployment

• Information Technology

• Facility Expansion

• Integration

• Partnerships

• Improving Quality and Efficiency Simultaneously

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Confidential – Exempt from FOIA

Create the future of health care through discovery

Become the national leader in health care, health care reform,

biomedical innovation and education

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Driven by Our Vision