The Secret Sauce of Health Care Management (09:24)

Any physician leader has memories that cause them to cringe, of doing things they hoped would work out but did not, and of learning lessons the hard way. For NEJM Catalyst Leadership Board Founder Tom Lee, one of those embarrassing memories is of a time “when I really did think that being a good leader meant giving a great speech,” he says. He recalls how at Partners HealthCare in Boston one night in 1996, at the last big meeting of medical leadership before Partners embarked on its first big capitated contract with a major HMO, he showed a film clip from Henry V.

“[As Chief Medical Officer] I thought that my job was to rally the troops, to help them see that what we are trying to do was important, and that in fact, it was something great and noble, something we could be proud of for all time if we did a good job.” To make that point, he showed his colleagues a clip of Henry V giving the St. Crispin’s Day speech, and then gave everyone sweatshirts quoting the speech.

Everyone left the meeting full of confidence, says Lee. But, “in retrospect, I would say we were probably better prepared to fight the French army than to actually manage care for a population.” When the first data came in, they were losing $1 million a month. “That was how I learned that a speech is just a speech and that goosebumps fade, and that you need to do something more if you’re going to create sustained change.”

After that, Lee’s “next phase” as a physician leader was financial incentives. He describes the two big takeaways from prospect theory:

  • Proportion matters. If someone gives you $100, you’re happy, but if someone gives you $200, you’re happier — but you’re not twice as happy.
  • People value losses differently from gains. If someone gives you $100, you’re probably not going to call home about it, but if you lose $100, you’ll be in a bad mood for the rest of the day.

“The message that my colleagues and I extracted from prospect theory is that the sweet spot, where you get the most return on your incentive dollar, was close to zero and to the left of zero, multiple small packets of incentives that were framed as potential losses,” explains Lee. For a time, their fund flow was influenced heavily by prospect theory.

The current phase is surrounding physicians with systems. “While they work hard doing their good work, we implement electronic medical records with decision support to help them be better and more efficient and safer,” he explains. They also place high-risk care managers, population health managers, and variation analyses for physician performance comparison.

“None of these individually has been enough; collectively, they haven’t been enough to change performance to meet the market’s needs for better quality and safety,” admits Lee.

Lee points out two lessons he’s learned the hard way:

  • If you layer new systems on top of the same old care delivery system, those new systems won’t change much. “The hard work, the brutal work of departing from the past and actually organizing care around what patients actually need — not much can really happen until that challenge is taken on by leadership,” says Lee.
  • The health care business is complicated, and people are complicated. “The idea that any one single thing will be enough is wrong.”

Lee describes Max Weber’s four models for social action: tradition, self-interest, affection, and shared purpose. To illustrate these models, he notes how the Mayo Clinic has a social norm of answering beepers immediately — and if you don’t, you don’t fit in. Other examples include the University of Utah’s policy of transparency with all patient experience comments, a non-financial affection incentive, and the Cleveland Clinic’s creation of shared purpose via its empathy video. “You need them all,” says Lee. “You need to create that shared purpose and then you need to be ready to press these individual levers as well.”

“There is no single silver bullet, but I think that collectively these could be a secret sauce if we’re applying them toward work worth doing, which is meeting the needs of patients,” says Lee. “And if we can do that, then, someday, maybe we get to be Henry V and give the St. Crispin’s Day speech.”

From the NEJM Catalyst event Physicians Leading | Leading Physicians at Intermountain Healthcare, July 12, 2017.

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