Foundations of a High Performing HCO

PURPOSE

 The purpose of any healthcare organization (HCO) is to provide care to individual patients.
o This purpose can also be expanded to “population health” but this larger purpose
depends upon excellence in care to individual patients.
 Other institutions that impact population health include schools, environmental sanitation,
public safety, and public health.
 HCOs deliver care through caregiving teams which are backed by three levels of support:
o Clinical
o Logistic
o Strategic
 HCOs are generally housed in purpose-built spaces such as clinics, operating rooms, business
offices
o With increasing technology, care giving teams can also be geographically dispersed.

IMPROVING POPULATION HEALTH

 There are 4 steps in improving population health

1. Defining the population
2. Measuring the current state of health in the population
3. Setting goals for improvement
4. Directing resources toward making improvements
 Healthy Community Cycle
1. Preventive health maintenance
2. Primary care (ambulatory management of preventative, acute, and chronic services)
3. Acute inpatient or specialty outpatient care
4. Rehabilitations in hospital, home, or nursing home setting
5. Continued care in home or nursing home setting
6. Palliative care and death
 Costs tend to rise and benefits decline as a patient moves away from the healthy state, therefore
optimum care maximizes use of prevention health maintenance and health improvement.
 HCOs are dynamic in three ways:
1. HCO constantly responds to the changing array of patients and their changing needs
2. HCOs evolves as medicine, technology, and management changes to makes use of the
latest scientific treatments.
3. HCOs adapt to the changing community needs. As the population grows, shrinks, and
changes in age and ethnic diversity, the epidemiology of disease changes and the HCO
must respond.
STAKEHOLDERS: THE HCO’S OWNERS AND MARKET PARTNERS

 Stakeholder – Individuals or groups who have a direct interest in the organization’s success.
o Stakeholders are buyers, workers, suppliers, regulators, and owners
o Stakeholders’ interests are inherently conflicting:
 Buyers want to buy inexpensively
 Suppliers want to maximize profit
o An HCO becomes “excellent” or “high performing” when it is able to negotiate effective
solutions among its stakeholders.
 Customer Partners
o Patients and Families
 Most important stakeholder
 HCOs are increasingly focusing on patient-centered care and involving patients
and families in care planning so that they can provide “care that is respectful of
and responsive to individual patients preferences, needs, and values”
o Health Insurers and Payment Agencies
 Health insurers and fiscal intermediaries provide most of the revenue to HCOs
(making them essential stakeholders)
 Private insurers are agents for buyers, which include governments, employers,
and citizens.
 Medicare and Medicaid
 Medicare deals with HCOs through fiscal intermediaries (an outside
contractor that processes claims for US Government programs)
 Medicaid is a combination of state and federal programs that finances
care for the poor. Medicaid is run by the State Medicaid agency or an
intermediary.
 Patient Protection and Affordable Care Act (ACA)
 Increased insurance coverage for many patients
 Instituted new approaches to those with chronic disease
 Required greater accountability for cost and quality of care
 “Triple Aim”
o Improved the individual patient experience with healthcare
o Improved population health
o Reducing per capita cost of care
o Regulatory Agencies
 Act on behalf of patients through regulation
 Requiring Certificate of Need for construction or expansion
 Quality Improvement Organizations (QIO) review quality of care and use
of insurance benefits by individual patients and physicians for Medicare
and Medicaid
 Consumer Protection Laws
o Health Insurance Portability and Accountability Act (HIPAA)
o Emergency Medical Treatment and Active Labor Act (EMTALA)
o Community Groups
  Facilitate infant adoption, receive victims of accidents and violence, serve the
homeless, the mentally ill, and those with chronic substance abuse concerns
 Provider Partners
o Associates
 HCO employees, trustees, volunteers, and medical staff members
 Licensed independent practitioners (LLPs) – caregivers granted legal status to
provide specific kinds of healthcare
 Usually physicians or advanced practice nurses
 Primary Care Practitioners
 Specialist Practitioners
o Associate Organizations
 Unions
 Professional Associates
o Suppliers and Financing Agencies
 Financing Partners help HCO acquire capital
 HCO use goods and services from various suppliers
o Other Provider Organizations
 HCOs have considerable contact with other provider organizations such as
primary care clinics, mental health and substance abuse services, home care
agencies, hospices, rehabilitation, and long-term care facilities.
 Sources of Stakeholder Influence
o Participation and Market Pressure
o Negotiation
o Networking and Coalition Building
 Buyer and consumer-oriented networks allow stakeholders to address social
problems such as healthcare’s uninsured and health promotion.
o Social Controls
 Stakeholders can imbed their viewpoints into law, regulation, and contract
 They can also sue in courts
 Create various regulatory mechanisms.

EXCELLENCE IN AN HCO

 Three Foundations of Excellence

o Cultural – a commitment to values that attract the respect and support of stakeholders
as individuals
 5 elements of successful cultural foundation
 Shared values
 Empowerments
 Communication
 Services excellence
 Rewards for success
o Operational – a system that seeks out, evaluates, and implements opportunities to
improve stakeholder returns
 Evidence Based Management
  Performance management
 Identification of best practices
 formal process specification
o Strategic – system that deliberately monitors the long-term relationship between
stakeholders and responds to changing needs
 Strategic Positioning
 First component – intensive and analytical
o Generate proposals for responding to the most important
questions
 Second component – decision to implement specific proposals
 Strategic Protection
 Assets of an HCO are subject to known hazards
o Money gets stolen
o Facilities get damaged
o People get hurt
o Information gets distorted
 ANY asset can be lost
o First line of defense is work processes designed to protect
against these risks
o Audits
 Transparent performance review
 Excellent HCOs encourage open review of
reports
 Internal audits and review
 External audits, review, and oversight