Leadership

Manage for Population Health or Volume — Not Both

Article · March 24, 2017

A strong health care center or system requires its leaders to demonstrate financial stewardship and a solid business case. How should that stewardship be conveyed to direct reports, the board, or others in your organization?

“We can’t hide things. We must be completely transparent,” says Akram Boutros, President and CEO of The MetroHealth System. “At my board retreat earlier this year, I said to them, ‘I’m either going to manage this organization for population health and what’s coming, or I’m going to manage it for volume. You get to choose.’” Boutros told them he couldn’t do both because he did not want to send conflicting messages. He also noted that although MetroHealth had been doing well financially, they would likely lose money over the next couple of years. Despite this, the board agreed to focus on reducing MetroHealth’s readmission rate — which dropped by 2,000.

“That’s $18 million that we’re not going to recapture every year from this point on,” says Boutros. “When we talk about our financial stewardship, we ask our executives if they’re doing the right thing. And if they’re doing the right thing, we think there’s a cost that we can bear sometimes in moving through that transition.”

“Our goal is to align our overall strategy with our future financial success,” adds University of Utah Health Care CEO Vivian Lee. “All of us, whether we’re on the clinical side of the enterprise or the academic, are interested in the financial success of our hospitals and clinics.” University of Utah has made an effective case for this, notes Lee. For example, the organization’s patient satisfaction efforts have led to significant growth in referrals, network development, and regional hospital partnerships, and the organization’s annual growth is higher than ever — everyone wants a great patient experience.

“That word of mouth, the reputation that disseminates, is incredibly powerful for driving volume,” says Lee. “At the same time, a lot of times we struggle with the potential downstream impact of cost management.” If you’re monitoring costs and no one orders MRIs, for example, what will happen to your radiologists? “It’s not perfect in every regard,” she acknowledges, “but there can be good alignment between financial benefit and what we’re trying to do to transform health care.”

Watch the video:

From the NEJM Catalyst event Leadership: Translating Challenge to Success at Mayo Clinic, June 2, 2016.

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
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.

Health Care Organizational Culture Emphasizes Patient Care Only Slightly More Than the Bottom Line

Survey Snapshot: Who Should Lead Culture Change?

NEJM Catalyst Insights Council members feel that culture change at their organizations is heading in the right direction, but differ on who it should come from, and reveal too much balance between emphasis on bottom line and emphasis on patient care.

Culture Change Within Health Care Organizations Is Changing for the Better

Leadership Survey: Organizational Culture Is the Key to Better Health Care

Although three-quarters of Insights Council survey respondents say culture change is a high or moderate priority at their organizations, survey results show a lot of work on organizational culture remains to be done.

Metraux01_pullquote - dinners to combat burnout in the health care community

“Breaking Bread” to Combat Burnout

Can a simple dinner create community among health care providers?

Connect

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

Learn More »

Topics

Leading Teams

170 Articles

Survey Snapshot: How Do You Know…

The NEJM Catalyst Insights Council discusses strategies for clinical engagement.

Team Care

110 Articles

Survey Snapshot: How Do You Know…

The NEJM Catalyst Insights Council discusses strategies for clinical engagement.

Rating the Raters: An Evaluation of…

Some promising innovation is taking place among organizations that rate hospital performance, but major systemic…

Insights Council

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

Apply Now