Shrink To Grow
Wednesday, October 27, 2010
This is a affair of expert administration in addition to expert world policy. Let me explain.
From the beginning, the creation of PHS was never intended to final result inwards a clinical integration of the flagship hospitals, Massachusetts General Hospital (MGH) in addition to Brigham in addition to Women’s Hospital (BWH). The ii organizations select disparate cultures in addition to select ever suffered from usual jealousies, sometimes rise to the grade of disdain. The senior leadership of PHS recognized early the futility of clinical integration in addition to instead focused on back-office functions—purchasing, data systems, in addition to negotiations amongst insurers. On those fronts, they were relatively successful, achieving roughly economies of scale in addition to other fiscal gains.
As the scheme grew, amongst acquisition of Dr. groups in addition to incorporation of outlying community hospitals, the clinical split upward betwixt the flagship hospitals was reinforced. To this day, physicians in addition to community hospitals refer their patients primarily either to MGH or BWH. Researchers inwards each flagship infirmary select no exceptional interaction amongst those inwards the others, compared to interaction amongst the other non-PHS Harvard hospitals. Education programs—undergraduate medical didactics in addition to residency programs both—likewise are physically in addition to culturally separate inwards most respects. Quality improvement programs, to the extent they exist, are hospital-centric. Development of novel clinical initiatives occurs inwards 1 house or the other, but seldom inwards both.
Beyond that, each infirmary has used its influence at the PHS headquarters to impair roughly of the creative energies inwards the other. There are enough of stories, for example, of times an first at BWH powerfulness select the potential to endure genuinely competitive amongst an established plan at MGH, in addition to solely to notice itself quashed at the corporate level. These were non cases of rationalizing attention delivery: They were only opportunities for ego-flexing.
Likewise amongst regard to philanthropy. Donors are identified early in addition to separately equally MGH targets of chance or “BWH people.” Never the twain shall meet, in addition to their identities are carefully guarded until the gifts are secured.
So this is non genuinely an integrated wellness attention system, in addition to it volition never be.
On the describe organisation side, too, the existence of economies of scale has clearly reached a bespeak of diminishing returns. Look, for example, at the recent $1 billion data systems contract amongst Epic. I am willing to bet that disparities inwards the models of attention in addition to administrative requirements betwixt the ii segment of PHS are causing that information technology scheme to select higher costs than would give off if it were beingness constructed for ii separate in addition to to a greater extent than culturally distinct organizations.
Likewise, at that spot is footling or no payoff inwards purchasing contracts for this large scheme that would non endure available for ii somewhat smaller, but nevertheless really large systems.
Further, the centralized PHS corporate business office amongst high salaried people inwards the high-rent Prudential Center is quite properly viewed amongst resentment equally mere overhead yesteryear those both on Fruit Street in addition to Francis Street.
The 1 thing that powerfulness endure argued is that PHS has had effective in addition to extreme ability inwards its negotiations amongst insurance companies, leveraging its network spread to need higher rates than almost all inwards the region. But, fifty-fifty there, a instance tin endure made that the leverage was based on geographic authorization inwards each subregion—a authorization based either on the presence of the MGH-affiliated branch or the BWH-affiliated branch—as much equally the scheme equally a whole.
Meanwhile, though, the size of Partners makes it a target for opponents when it seeks to grow. Witness the recent objections to the acquisition of community hospitals to the due north in addition to southward of Boston. What powerfulness brand feel from a world policy bespeak of view, amongst regard to suburban-to-urban secondary-to-tertiary clinical integration, gets squashed or dependent area to burdensome regulatory requirements.
Everybody interested inwards wellness attention inwards Eastern Massachusetts—government officials, describe organisation customers, in addition to consumers—seeks to convey most terms savings, service improvements, in addition to a displace to higher character care. Notwithstanding lots of recent dry reason legislation, at that spot is a growing recognition that the solely agency to accomplish this is a greater grade of contest inwards this marketplace. As things stand, Lahey, BIDMC, Tufts in addition to the others tin solely nibble at the edges, in addition to they scarcely brand a departure inwards the overall results inwards terms of those desired areas of improvement. Meanwhile, Steward Healthcare System is showing signs of rapid reject in addition to irrelevance. Boston Medical Center, too, remains inwards its safety-net niche, scraping yesteryear amongst diminished dry reason in addition to federal resources.
The best agency to generate existent contest is to split upward PHS in addition to then that MGH in addition to its network in addition to BWH in addition to its network select separate corporate identities in addition to bottom lines. This would admit the de facto clinical separation of the ii components of the PHS scheme in addition to give each organisation a existent incentive to grow—but this fourth dimension through excellence inwards attention delivery rather than corporate heft. Each, too, powerfulness essay novel clinical alliances amongst the aforementioned Lahey, BIDMC, Tufts, Steward, in addition to BMC, offering the potential for rationalization of attention in addition to ameliorate utilisation of fiscal resources.
Would the Partners board select the nervus to dismantle a scheme they assume is working well? Frankly, non likely. But this is non a instance of having to worry most accretive value for shareholders or mortal equity investors. There are no shareholders here. The solely audience of concern should endure the public. The board owes it to that world to review the twenty-year history of the corporation in addition to objectively create upward one's heed whether the part is ameliorate off for the creation of Partners Healthcare System, in addition to whether the hereafter is ameliorate served yesteryear 1 entity or two. Indeed, whatever potential CEO worth his or her common salt should endure bespeak the interrogation earlier taking the job.
(Note to Attorney General-elect Maura Healey: Might they endure to a greater extent than probable consider a breakup if y'all tossed out the wrong-headed proposed understanding negotiated yesteryear your predecessor in addition to threatened a truthful antitrust lawsuit jointly amongst the U.S.A. Department of Justice? This is a 2nd for a corking negotiator, in addition to y'all select the ability to fix the province of affairs for an understanding that is genuinely inwards Earth interest.)