Leadership

My Favorite Slide: The Entrepreneurial Gap Applied to Health Care

Infographic · March 8, 2017

Value-based health care increases providers’ accountability for patient outcomes. Many physicians have resisted taking on such increased accountability, claiming that patient outcomes are influenced by many forces outside their control, such as care provided by other clinicians, patient compliance with post-acute and rehabilitation care, and the quality of external rehab personnel and facilities. These skeptics are, in effect, invoking the well-known Controllability Principle, in which managers are held responsible only for resources and outcomes that they directly control.

Accountability for Patient Outcomes: The Controllability Principle - Set Responsibility and Accountability Equal to Authority

  Click To Enlarge.

Yet contemporary management practice advocates the benefits of holding individuals accountable for results well beyond what they can immediately control. The difference between accountability and control is called an “entrepreneurial gap,” evoking the Harvard Business School definition of entrepreneurs as those who pursue opportunities — internally and externally — without regard to the resources they currently control.

When physicians become accountable for patient outcomes, through publicly reported functional and patient-reported outcomes, and are also paid through bundled payments that cover all the costs incurred in a patient’s care cycle, they face a significant entrepreneurial gap. To constructively cope with these enhanced expectations, they now must find ways to integrate, coordinate, and influence care outside their direct control. With such an entrepreneurial mindset, they might attempt to discharge more patients to inexpensive home health rehab rather than expensive skilled nursing facilities. They might hire patient care specialists to monitor and manage patients, both in-patient and post-discharge, “nudging” them for shorter hospital stays and encouraging them to remain on rehab and recovery protocols after they leave. They might coordinate with suppliers to get drugs, implants, imaging, and devices better matched to patient needs.

The creative tension generated by an entrepreneurial gap, although perhaps uncomfortable to health care providers, promises more integrated patient care and, as a consequence, superior patient outcomes at lower total cost.

Accountability for Patient Outcomes: What Happens When Span of Accountability Exceeds Span of Control?

  Click To Enlarge.

Call for submissions:

Now inviting expert articles, longform articles, and case studies for peer review

Connect

A weekly email newsletter featuring the latest actionable ideas and practical innovations from NEJM Catalyst.

Learn More »

More From Leadership

From the Commonwealth to Obamacare: Reflections on 10+ Years of Expanding Health Insurance Coverage

The former Executive Director of the Commonwealth Health Insurance Connector — a model for the Affordable Care Act and other state marketplaces — reflects on what worked, what didn’t, and what could be done differently in both Massachusetts and at the federal level.

Time Spent Engaging Directly with 16 Camden RESET Participants or Coordinating Care on Their Behalf

“Putting All the Pieces Back”: Lessons from a Health Care–Led Jail Reentry Pilot

The Camden Coalition’s jail-based reentry program illuminated the necessity and challenges of engaging people with complex health and social needs and helping to transform the systems that serve them.

Sands01_pullquote clinical research partnership for learning health care

Real-World Advice for Generating Real-World Evidence

If envisioned and implemented properly, a partnership between clinical delivery systems and clinical research programs can get us closer to the goal of achieving learning within the care continuum and discovering evidence that is available when it is needed.

The Largest Share of Organizations Do Not Have a Formal Strategy for Clinician Engagement

Leadership Survey: Why Clinicians Are Not Engaged, and What Leaders Must Do About It

Clinician engagement is vital for improving clinical quality and patient satisfaction, as well as the job satisfaction of clinicians themselves. Yet nearly half of health care organizations are not very effective or not at all effective at clinician engagement.

Rowe01_pullquote - clinician well-being - fighting clinician burnout and creating culture of wellness takes all stakeholders

Defending the Term “Burnout”: A Useful Tool in the Quest to Ease Clinician Suffering

Health care leaders must take a preemptive approach to clinician well-being that is supported by all stakeholders and prioritized on an equal footing with essential clinical and financial measures.

Screenshot from the NewYork Quality Care Chronic Condition Dashboard

Success in a Hospital-Integrated Accountable Care Organization

How NewYork Quality Care achieved shared savings — by strengthening collaboration, enhancing care management with telehealth, and transparently sharing performance data.

Miller03_pullquote social determinants whole-person

How a State Advances Whole-Person Health Care

Pennsylvania addresses social determinants of health by bringing together managed care and social services organizations to expand access to vital resources.

Abigail Geisinger Scholars Program for Medical Students -Ryu02_pullquote

Why a Teaching Hospital Offers an Employment-Based Tuition Waiver Program

Geisinger Commonwealth School of Medicine subsidizes medical students’ education in exchange for their willingness to practice at Geisinger Health System.

Michael Dowling and Charles Kenney headshots

Rebooting Health Care: An Optimistic Outlook

The U.S. health care system may seem broken, but it’s on its way to greatness, according to the authors of Health Care Reboot. They discuss their optimism for U.S. health care reform, particularly on the social determinants of health, payment, consumerism, and technology.

Action Steps for Risk-Share Contracts for Medical Devices

Challenges and Best Practices for Health Systems to Consider When Implementing Risk-Share Contracts for Medical Devices

When done right, value-based contracting for medical devices can ameliorate shrinking margins at health systems, leading to a virtuous circle.

Connect

A weekly email newsletter featuring the latest actionable ideas and practical innovations from NEJM Catalyst.

Learn More »

Topics

Leading Transformation

284 Articles

From the Commonwealth to Obamacare: Reflections…

The former Executive Director of the Commonwealth Health Insurance Connector — a model for the…

Physician Burnout

52 Articles

Survey Snapshot: How Do You Know…

The NEJM Catalyst Insights Council discusses strategies for clinical engagement.

From the Commonwealth to Obamacare: Reflections…

The former Executive Director of the Commonwealth Health Insurance Connector — a model for the…

Insights Council

Have a voice. Join other health care leaders effecting change, shaping tomorrow.

Apply Now