Posts Tagged ‘SunStone Consulting’

Light Up Night

November 20th, 2010

50th anniversary Light Up Night - Nick Jacobs, FACHE - HealingHospitals.comMy apartment is about two blocks away from Pittsburgh’s Cultural District and the same distance from the Sports District where the theaters, stadiums and plenty of restaurants are all nearby. Last night was the 50th anniversary celebration of “Light Up Night,” when the Holiday trees, choirs, and seasonal celebrations begin. Literally tens of thousands of people make their trek into the City for this special night. Zambelli puts on its finest fireworks display of the year, while lighted, horse drawn carriages, food vendors, and music fill the city. It is intended to be a special night for families, and last night was no different. Except for a few distractions.

Because my place is on a main drag and literally one apartment up from street level, activity sometimes feels like it is taking place directly in my living room. Most of the time, this reminds me that I’m alive and it is stimulating, exciting and always evolving. Last night, however, things were somewhat reminiscent of a war zone. Literally a block away, the Clemente Bridge was the staging point for some magnificent fireworks and the crowds were everywhere.

Not long into the celebration, however, it began to feel like Chicago during the filming of the Blues Brothers. Sirens were raging past my apartment at the rate of one a second to what could have been a gun battle. Instead, it was one gun and one victim with plenty of other potential participants standing by ready to mix it up. Then, a few minutes later, another burst of sirens went in the other direction toward an Irish Pub about a block from my apartment. There, another man had been shot. When the news came on, it was apparent that every available policeman in the City had been called to the Wood Street scene to attempt to keep things from boiling over as young men were escorted in handcuffs toward waiting police vans.

I am NOT a sociologist, but it seems very clear that this is just the beginning of what could literally escalate into a form of anarchy as we continue to pursue our current philosophy of greed in this country. While working on a grant a few months back I saw a statistic that was mind numbing. Young African American men in what are considered high crime areas of this city are experiencing an unemployment rate of about 75+ percent. The national average for young black men is about 45 percent and in Pittsburgh, with a few point differentiation due to my sometimes less-than-precise memory, that more global average jumps to about 55 percent.

This week, however, we heard that unemployment compensation would probably not continue to be extended, and last week we heard that education was only one of the potential targets for domestic budget cuts. Not unlike the hospital employees who consistently take all of the premium parking spaces so that their walk into the building is the very closest possible, there seems to be a breakdown in logic. If we don’t correct the problems that we have in our education system; if we don’t help people who have, for no reason of their own become jobless or disabled; if we stop caring about the middle class, and stop helping the poor to establish themselves; where will it lead as a nation?

My personal belief is that we can cut both domestic and military budgets; we can delay some gratification, and we can tweak some of the laws that allow profits to benefit the one or two percent of us who are clearly now in the elite class of protected citizens. The question is, can we do this in a way that does not destroy those who are struggling to survive? Take away the parking places, and you discourage patients from using your hospital which leads to lay-offs. Take away the safety nets, and we might soon have an out of control population that will cost us more than any of the tax breaks or safety net cuts give us. Let’s cooperate in repairing this mess. PLEASE.

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$500 Billion From Where?

October 26th, 2010

In a recent conversation with a long time healthcare CEO, he made the following observation:

“There are about 2,750 pages to Obamacare.  I have no idea what the implications are of the first 2,700 pages, but I do know that at least 50 pages allude to the fact that $500B will be cut from hospital reimbursements in order to support the new legislation, and it’s also clear that these monies will be cut based upon quality.  Pay-for-performance will be the new catch phrase of the reimbursement world, and our peers are not ready for this stark reality.”

How does one move from a non-transparent system to one that allows anyone to log onto healthcare websites and search every detail relating to the success rates, scores, and capabilities of any given institution?  One very obvious “missing element” in hospital-related problems is the lack of dedication to getting to the “root cause” of most issues.  We are great at work arounds, but rarely take the time, energy, and have the cultural commitment to dig deeply enough to literally stop the root cause of the problem.  Is that why there are a reported 98,000 people killed by our facilities, and about an equal number injured each year?


Several organizations have attempted to take on these issues, but few have gone beyond scratching the surface of the real problems.  As bundled payments become the norm, a commitment to getting the highest available reimbursement for procedures will take on a new meaning.  Imagine a great doctor in an under-performing medical center where his or her work is not rewarded equally to a peer in a stronger hospital, because that bundled reimbursement was lowered due to institutional medical imperfections. Charles Kenney in  The Best Practice, and Steven Spear in The High-Velocity Edge have both addressed some of the nuances of this new culture, this new world order, but for hospital administrators, physicians, and staff to “get their arms around it,”  there will need to be transformational shifts in the fundamental culture of the organization.

Leadership will be forced to accept personal responsibility for virtually everything that occurs in an organization.  Employees will need to be empowered to embrace shared values, and key targets such as patient and employee safety will need to be identified so that goals can be set that stop nothing short of a level of complete PERFECTION.

The healthcare establishment will also need to embrace transparency within their organizations, and that information must be shared with everyone.  Most importantly, it must include the human element.  What is the human impact of each and every error or mistake?  This point alone will represent a major cultural shift in the way we do business.

Truman's phrase "The Buck Stops Here" - F. Nicholas Jacobs, FACHE

Employees, physicians, and administrators will need to actually be taught to see risk, and be provided with data upon which actions may be taken.  Most importantly, however, problem solving must be encouraged and supported at every level of the organization.

How is this all possible?  I was recently on a speaking tour to several hospitals, and the bottom line at these facilities was that their leadership was “new age.”  They had worked diligently to decrease the hierarchy and to reduce and reorganize the roles of those in operations in order to support the fastest possible improvements.

The tsunami is coming, however slowly it may appear to be; it is approaching our healthcare shores, and quality – no, perfection, is the only means left for achieving success or, in many cases, is the only way to survive.  We must discipline ourselves to see problems and not simply try to work around them.  We must establish a problem solving culture.  We must set our goals and empower all of the players to do what is needed to solve these problems once and forever.  Harry Truman’s phrase, “The Buck Stops Here,” should become every CEO’s mantra, and the journey will finally begin, the journey to solve the myriad repeating problems in our current system.

Nick Jacobs, FACHE - HealingHospitals.com

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Things People Are Thinking About

October 14th, 2010

Every few weeks or so, I take the time to read articles produced by The Pew Research Center, a non-partisan fact tank. Pew does not take sides in policy disputes, but they do provide a valuable information resource for political leaders, journalists, scholars and citizens. I believe that I come under that last category, citizen. The only requirement that Pew has relative to their findings is that their sources are cited accurately and in context.

Recently, they provided some fun statistics:

For example, among the public, one-in-four (25%) believe in astrology (including 23% of Christians); 24% believe in reincarnation, nearly three-in-ten (29%) say they have been in touch with the dead; almost one-in-five (18%) say they have seen or been in the presence of ghosts. If none of those statistics surprise you, then you clearly are not me.

Here was another great poll finding: 87% of scientists say that humans and other living things have evolved over time and that evolution is the result of natural processes such as natural selection, but only 32% of the public accepts this as true. (From the work of Jodie T. Allen and Richard Auxier, Pew Research Center)

Conference on Climate Change, Poznan, Poland

Well, this next poll was even more interesting to me. As both a business person and a humanist, it has been difficult for me to hear large numbers of my friends and acquaintances literally “going off” about how ridiculous global warming is. They say things like, “Global warming and global cooling happen all the time; it’s just a natural course of events.” Others say, “Al Gore filled us with lies about global warming for his own financial gain.” Finally, I have heard over and over, “Well, we can’t do anything about it anyway, so why worry.”

Then there’s the opposite side where experts say things like, “If we stopped using all fossil fuels right now, the earth will continue to heat for another 60 years, and all of the devastating floods and fires that we’ve seen this year were the result of only a 1 degree increase in the world’s temperatures, and in 60 years we will heat up by 5 degrees.”

What did Pew find about the current global attitudes about climate change?

Pew - global attitudes about global climate change - Nick Jacobs, FACHETheir international polling shows that publics around the world are concerned about climate change. In the recent spring 2010 Pew Global Attitudes survey, majorities in all 22 nations polled rate global climate change a serious problem, and majorities in ten countries say it is a very serious problem. There are some interesting differences among the countries included in the survey. Brazilians are the most concerned about this issue: 85% consider it a very serious problem. Worries are less intense, however, in the two countries that emit the most carbon dioxide — only 41% of Chinese and 37% of American respondents characterize climate change as a very serious challenge.

Even though majorities around the globe express at least some concern about this issue, publics are divided on the question of whether individuals should pay more to address climate change. In 11 nations, a majority or plurality agree that people should pay higher prices to cope with this problem, while in 11 other nations a majority or plurality say people should not be asked to pay more.

These findings remind me of numerous other examples of confusion created by the short term winners and losers in what are serious economic discussions. There are 1.5 B Chinese, and over the next several years, many of them are going to want a car. Regardless of your own personal stand on this issue, that’s some serious potential pollution.

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Bhutan’s Philosophy of “Gross National Happiness”

October 3rd, 2010

Not everything that can be counted counts, and not everything that counts can be counted.
—Albert Einstein

At a recent conference I had the opportunity to learn about the Himalayan nation of Bhutan. Most of us had not heard of this country, but we should have, because they have done something that is reminiscent of the Broadway Musical “Camelot,” or possibly “Brigadoon.” Their King introduced a philosophy of living that is intended to shape all of the government’s activities. According to Mr. Kuenga Tshering, Director of the National Statistics Bureau of Bhutan, Gross National Happiness (GNH) was promulgated as Bhutan’s philosophy of economic and social development by the Fourth King of Bhutan as soon as he came to the throne in 1972.

The reason I’m writing about this is because I believe it is an amazing idea, a wonderful goal, and a step toward embracing  idealism.  Many of you have heard my thoughts on change, and know that I do not believe that there is only one route to follow on this journey through life.

Takstan Monastery, Bhutan (image credit: johnehrenfeld.com)

Takstan Monastery, Bhutan (image credit: johnehrenfeld.com)

The Bhutanese philosophy of “living” refers to a set of social and economic interventions that evaluate societal change in terms of the collective happiness of people.  Further, these measures are also applied to the creation of policies that are aimed at that objective. Premised on the belief that all human beings aspire to happiness in one way or another, the concept promotes collective happiness of the society as the ultimate goal of development.  Now that would be a political platform!

The philosophy of Gross National Happiness considers economic growth as one of the means towards achieving happiness, but it also offers a holistic paradigm within which the mind receives equal attention. While GNH recognizes the importance of individual happiness, it emphasizes that happiness must be realized as a collective or societal goal and not be defined as an individualized or competitive good.

The philosophy should also not cause misery to future generations, other societies, or to other  beings, and it is important to the government of Bhutan that the efforts of this philosophy be distributed evenly across all sections of  the society.

They work at strengthening the institutions of family and community; the spirit of voluntarism, tolerance and cooperation; the virtues of compassion, altruism, honor and dignity, all of whose active promotion may be a contributing factor to Bhutan’s low crime rate.

Culture also provides a framework where an individual’s or society’s psychological and emotional needs are addressed. By preserving local, regional, and national festivals, the government attends to these needs and provides a forum for maintaining social networks and promoting the conviviality of public culture.

His Majesty, King Jigme Singye Wangchuck of Bhutan

His Majesty, King Jigme Singye Wangchuck of Bhutan

Bhutan treasures the extended family network as the most sustainable form of social safety net. Aware of the possibilities of family disintegration or nuclearization, the government makes conscious efforts to revive and nourish the traditions and practices that bond families and keep communities resilient and thriving.

Their environmental policy is predicated on the perspective that human beings and nature not only live symbiotically but are inseparable from each other. According to this perspective, nature is a partner in existence; a provider of sustenance, comfort and beauty.

Environmental preservation, therefore, is a way of life in Bhutan. Currently, 72% of the country’s area is under forest cover, 26% of the area is declared as protected areas, and the state has decreed to maintain 60% of its area under forest cover for all times to come. Environmental cost is an essential ingredient of evaluating new development projects in  Bhutan.

Finally, Bhutan launched parliamentary democracy 2008, becoming the youngest democratic country in the world. All this was initiated by the country’s leader – His Majesty, King Jigme Singye Wangchuck, thus fostering people’s capacity to make choices.

Well, we have generally been making choices as a country for some time now that generally do not embrace nature, family, our fellow man, or the environment.  On a recent boat trip up the Caloosahatchee River, I expressed a dream, namely that mankind would embrace a philosophy of “National Happiness.”

Now wouldn’t that ROCK?

Not everything that can be counted counts, and not everything that counts can be counted. — Albert Einstein

Read more: http://blog.rypple.com/2010/06/chip-conleys-ted-talk-on-gross-national-happiness-gnh/#ixzz11MQ5ZTm6

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What’s Wrong With This Picture?

September 9th, 2010

American Healthcare Magazine - September 6, 2010 - Nick Jacobs, FACHE - HealingHospitals.comThe Modern Healthcare edition of September 6, 2010 has a cover headline that reads: “Passing the Buck,” and the descriptor goes on to explain that “Yet a new report says workers’ share of benefit costs is skyrocketing.”  The actual opening line of the article starts with “Workers are shouldering more of the costs of health coverage than ever before amid stagnant wages and a weak economy”…

A few weeks ago, I wrote about Patient Advocacy, a subject about which I am passionate. So, this blog is about patient and employee advocacy that also provides additional resources for hospitals to help them address the current economic challenges.

Every year when we looked at our medical insurance costs at my hospital, a politically incorrect friend would jokingly suggest that we begin an annual, required participation August Tennis Tournament for our high-utilization employees, but only after the temperatures reached at least 95 degrees.  “It would be a thinning of the herd,” he would jokingly say with an elf-like smile on his face.  We would then get serious and dig into a long list of creative ideas aimed at helping contain these costs so that we would not have to lower benefits or pass the charges on to the employees.

Included in these lists were some rather simple ideas such as offering, in a structured manner, the wellness options covered under our health insurance umbrella and generally rewarding our employees for taking better care of themselves.  We significantly reduced fees for the workout facility (1/3 of the regular cost ), provided personalized counseling from our dietitians, had a weight loss contest and gave rewards for taking classes on stress management, smoking cessation, diabetes control and exercise.

We offered psychological counseling for our employees who were suffering from stress related issues.  Our food service vendor, CURA, made sure that “no transfats” were a part of the hospital’s meals, that there were always low-fat vegetarian choices on every menu, that snacks were reasonable and that our vending machines had healthy choices. We also celebrated life and work on a regular basis.   We had cook-outs, off-stage break rooms, massage, aroma, Reiki, pet and music therapy.  We provided drum circles, non-denominational spiritual services and meditation classes; kick boxing, Pilates, pool therapy, and employee parties.

So, short of forced tennis matches, how else can we control these costs?  The following is a summary of a program that SunStone Consulting is currently offering with two other business partners, CBIZ and InforMed.

Over the past 6 years, the average annual health insurance cost increase for InforMed-supported patient advocacy programs has run at 4.5%, compared to the 10-12% trend for all employers.  In the case where a hospital with 1,500 employees is paying out about $10,000,000 a year for employee health insurance, a 5% savings over a three year period would generate $3.3 million in savings.  Let me repeat that:  By lowering those  premium increases by 5%, there would be over three million extra dollars available for hospital financial needs and co-pays and deductibles for the employees would not have to continue to escalate by 13 to 15% annually.

The Patient Advocate logo (California) - Nick Jacobs, FACHEThe care management “engagement” rate of all the major insurance companies is about 30%. That means that the insurance company-based “help programs” are about 1/3 effective in even reaching the employees.  This non-insurance company based program, however, has a 70% engagement rate of identified large claimants, more than double the insurance company’s rate, and with over 1 million employees in this program, they produce a 98% patient satisfaction rate.

By employing local, trained, patient advocacy nurses, paying physicians a monthly stipend out of the savings to help manage these patient/employees, and then helping those high utilization patients legitimately navigate through the nine to fifteen physicians with whom they interact on an annual basis, health systems are seeing tremendous savings.  (Kind of the Best of Managed Care scenario.)

These are clear, actionable items that will positively change a bottom line quickly and permanently without having to increase the financial burden on the employees.

Why not try it?  It works.

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Moving Through Healthcare’s Version of the BP Oil Spill

May 27th, 2010

Who could have ever guessed that the United States of America would fall so far behind in education, childhood death statisticsscientific research, manufacturing jobs, and even overall, general healthcare?  Yes, of course, we are still a wonderful, strong country with incredible resources, but somewhere along the line, the train seems to have jumped off the track just a little, or is that like being a little pregnant?  No one would ever have conceived that a spark plug would be worth more than GM stock, but that’s exactly what happened last year.  Or how about the fact that large investment banks responding to the mandate to increase home sales by spreading the risk internationally could have helped put this entire world on the verge of a national depression?

For years now I’ve written about the need to provide some type of safety valve for the uninsured, underinsured, and those struggling to make it from layoff at age 58 to Medicare at age 65.  Not unlike the Kennedy-Katzenbaum bill, (you know, that HIPAA bill that was just meant to provide health insurance portability), we have healthcare reform legislation.  The really challenging thing about this new bill is that it was primarily written by policy wonks fifty percent of whom will not be working in Washington D.C. in a few years, and worse than that, it will be interpreted by policy wonk lifers who will be there long after we are all dead.

So, the “Healthcare Oil Spill” has been addressed.  What will it mean?  What does it mean?  How will it impact all of us?  That remains to be seen.  The good news is that 30 million more people will finally have a safety net. The bad news is that there are still two wars going on that are draining our treasury.  There is still financial chaos among the countries lovingly referred to by the EU as the PIIGS (Portugal, Ireland, Italy, Greece, and Spain), and, along with this group,  spending in the United States  has been out of control for at least nine years.

What will happen is anyone’s guess.  How things will be interpreted is anyone’s guess.  How the law will be enforced is every one’s guess, but in  a recent round table discussion at the Mid-State HFMA meeting, we heard four CFOs discuss the challenges that they currently face and will continue to face as life becomes even more complex.  After that session, I’m thinking that lots of mud pushed in the head of the well might just be the cure!  Goodness knows there was enough mud thrown around during this last election cycle.  Maybe we could redirect it back to the source?  I do know for sure that one thing is clear: CHANGE is INEVITABLE, the train is back on the track, and it’s coming straight toward our physicians, hospitals, and nursing homes.

How do we cope with that change?  Make sure that every ounce of fat is cut from the system.  Take a look at the list below and contact SunStone Consulting for the next steps:

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Speaking This Year

May 20th, 2010
Nick Jacobs, FACHE - F. Nicholas Jacobs - Healing Hospitals - Sunstone Consulting

Nick Jacobs, FACHE

As some of you may have noticed, last year was a tough year for education, travel, and some forms of consulting. It was “the economy, stupid.” A number of our major public speaking engagements were canceled or postponed, because hospitals stopped sending employees to educational conferences. In fact, at one of the leadership conferences where we spoke last year, there were only 90 people in attendance. The previous year, there had been nearly 500.

Well, thank goodness, things have picked up a bit, and we will be speaking a few more times over the next several months. The following is an up-to-date list of locations, dates, and topics currently scheduled:

  1. Lake Erie Regional Cooperative/Amerinet Conference, Toledo, OH, May 7th, 2010
    “Redesigning the Patient Experience”
  2. Risk Management and Patient Safety Institute, Lansing, Michigan, August 27, 2010
    “Blogging and Transparency -Increasing Patient Satisfaction through Web 2.0”
  3. Planetree Conference, Denver, Colorado, October 8th, 2010
    “Navigating the challenges faced while transitioning to the Planetree model of care”
  4. Central Peninsula Hospital, Soldotna Alaska, October 14, 15th
    “Planetree”
  5. Waverly Health Center, Waverly, Iowa, October 20-22,
    Topic: To be announced
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So “Radical” Was the Correct Term?

April 8th, 2010
In 1987, my healthcare journey began in administration by asking the question, “Why are hospitals the way the are?”  It was a sincere inside/out question that had evolved from my having been a teacher, executive director of an arts organization, president of a convention and visitors bureau, and finally a PR/Marketing and Development professional in the world of healthcare.  By 1997, my ideas had been rejected so many times by so many traditional hospital administrators, who were either my bosses or my peers, that it felt like they would never come to fruition in a conservative field where change is sometimes seen as both life and job-threatening.
butterfly metamorphosis
In 1997, that all changed when Ernst and Young evaluated the hospital where my presidential appointment had just occurred and predicted the closure of that facility due to lack of population, lack of “financial depth” (a.k.a. cash), and a health system partner that successfully was eating our lunch each and every day. It was with that information in hand that I began the metamorphosis of this organization. The presentation to the board and medical staff was relatively simple:

“We can keep doing what we are doing, and then board the place up… or we can grow by changing  the way healthcare is delivered.”

No workplace bullying - Nick Jacobs - healtinghospitals.comLuckily for me, my board chairman at that time was a risk taker because, realistically, our backs were against the wall.  So, we began a journey of change.   We removed bullies from the workplace (both physicians and employees); created a homelike environment where you did not have to leave your dignity at the door;  added bread baking machines, popcorn machines in the lobby, decorative fountains, aroma therapy, massage, humor, music, and pet therapies.  We focused on Green, focused on Dignity for employees and patients; focused on providing a peaceful, loving, and Healing Environment; focused on Family Spaces; focused on Architecture; and focused on Quality of Care.  We began classes for our employees in Hospitality in Emotional Intelligence Quotient training and embraced ideas garnered from places like the Ritz Carlton, Disney, and Dale Carnegie.  Then we established an employee evaluation system that embraced these changes and rewarded our staff financially for their work.

Loved ones were encouraged to stay 24/7 as visiting hours were opened to them, double beds were placed in the OB suites, a wellness/prevention/and integrative health facility was built to embrace not only traditional therapies but to an entire gamut of alternatives.  A senior citizen center was condominiumized and made available to the Area Agency on Aging.  We had patients help us design a new Palliative Care Unit, Breast Care Center, and Fitness facility, then finally we added a world class International Research Institute.

That was 1997 through 2008.  It appears from the posting below that the world is beginning to consider some of these ideas, but lo, these many years later, they are still being referred to as “radical.”  Well, if any of you are interested in how to do what we did which tripled our organizational budget in size and doubled our workforce,  just give me a call at 412-992-6197, to participate in this program.

Obviously, Windber, Pennsylvania was where this movement all started.   Let’s make sure that it doesn’t stop.  After all, it’s not what people like.  It’s what people LOVE.

Henry Ford Health System - Nick Jacobs, FACHE - HealingHospitals.com

Henry Ford Health System Goes Radical: Creating the Hospital of the Future

DETROIT – Looking to shake up your industry, transform your medical center, and recharge your organization?

A two-day educational symposium, “Going Radical: Creating the Hospital of the Future,” may hold the key to revitalization. It will be held May 25 – 27.

Henry Ford Health System President and CEO Nancy Schlichting will share her radical, but practical strategies for success at the symposium, tapping into the wisdom of her top executives in an interactive session on the profound lessons learned during their tenure.

It was Schlichting’s brainstorm to hire a CEO for Henry Ford West Bloomfield Hospital from outside the healthcare industry. Her choice was Gerard van Grinsven, a former executive of the Ritz-Carlton hotel chain, and an expert in service excellence.

Henry Ford West Bloomfield staff will discuss its successes in differentiating itself from the competition by:

• Constructing prototype rooms for planning and community input.

• Incorporating green features in the architecture and construction.

• Building all private patient rooms, including in the emergency department.

• Emphasizing wellness and healthy living.

• Combining traditional clinical care with complementary therapies.

• Creating a unique brand and inspiring staff to think differently.

• Including family space in each patient room, including intensive care.

• Implementing a new kind of food culture in health care.

• Putting a focus on the special concerns of the elderly.

Entrepreneur Bill Taylor, co-author of Mavericks at Work and co-founder of Fast Company magazine, will be the keynote speaker. His ideas have helped shape the global conversation about how business works and “why the most original minds in business win”. His next book, Practically Radical, to be published this fall, explores how to unleash big change in difficult times.

During break-out sessions Henry Ford staff will share lessons learned while juggling the building of the $360-million West Bloomfield hospital and the $300 million renovation of Henry Ford Hospital in Detroit.

Tours of Henry Ford West Bloomfield Hospital will include a visit to the Emergency Department, wellness center, and an inpatient room. At Henry Ford Hospital, participants will tour the Center for Simulation, Education and Research – one of the largest facilities of its kind in the Midwest that provides hands-on training with medical mannequins.

Symposium sessions include:

• Creating a Culture of High Performance
• Facility Innovations Through the Eyes of the Patient
• The Best of Both Worlds: Clinical Excellence Meets Integrative Medicine
• Transforming Hospital Food
• Radical Outreach: Relationship Building to Win Over the Community and Recruit Staff
• Thriving in Detroit: A Blueprint for Transforming Your Hospital System and The Physician Perspective

each and every day.  It was with that information in hand that I began the metamorphasis of this organization.  The presentation to the board and medical staff was relatively simple, “We can keep doing what we are doing, and then board the place up, or we can change the way healthcare is delivered and grow.”
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Healthcare Reform. . . It’s only just begun

March 10th, 2010

This week’s Bloomberg Business Week magazine featured a phenomenal and very personal story of healthcare that actually captures many of the challenges around healthcare reform.  The author, Amanda Bennett, takes us on a journey that she has titled, “Lessons of a $618,616 Death.”  The true title, however, should have been, “How Do You Put A Price on 17 Months?”  In this article, Ms. Bennett takes us on the step-by-step, blow-by-blow journey that ended with her husband’s death.  She and a friend painfully reconstructed every page of his medical records, every dollar paid by her insurance companies, and every charge made by the various doctors and hospitals that treated him during the last years of his life.

Business Week end-of-life issue - Nick Jacobs - healinghospitals.com
Amanda Bennett and Terence Foley

She showed 1.) the grand total of charges, $618,616, 2.) the actual monies paid by the insurance companies to the hospitals after contractual negotiations, $254,176, and 3.) the total paid by her family, $9,468. In the article, she described the 30% overhead/administration costs, the costs of experimental drugs inside and outside of trials, and the 4,750 pages of medical records that were amassed during this time. For those of us who have “spent our time” trying to live within, cope with, and better understand America’s healthcare system, there were no surprises.  For those of us who have watched a loved one take this cancer journey with all of its mysterious unknowns, there were also no surprises. Ms. Bennett’s quote, “The system has a strong bias toward action,” was, I believe, the most poignant in the entire piece.

A few weeks ago, I had lunch with a very healthcare-savvy individual who, when I jokingly referred to death panels, almost came across the table at me.  She did not believe it was funny.  To say that she was passionate would miss the point.  Only the day before, I had spoken with another very intelligent healthcare reform advocate who indicated that the entire concept of death panels emanated from a payment code that reimbursed physicians for simply (or in some cases finally) talking to patients about their alternatives.  I had heard other explanations, but neither mattered.  What matters is that, in many instances, we are not discussing appropriate alternatives or revealing the quality-of-life issues often overlooked before beginning long courses of experimental drugs, or oncology drugs that may not have any positive impact on the health outcome of the individual.

Interestingly, Ms. Bennett did indicate that for all of the time, money, and pain invested in this journey, no one could confirm that her husband’s life was actually extended by these medical experiences.

Someone once described America’s healthcare system to me like this:  You walk into Nordstrom, order several three-thousand-dollar suits, a dozen shirts and some handmade, silk Italian ties, then turn to the person beside you and say to the clerk, ‘”He is paying for this.”  Our heroine Ms. Bennett did mention the fact that her husband would probably have questioned the use of all of these funds in this manner and the relationship that these expenditures might have had on all of the other people in the world who might have been helped by these dollars.

Taking the Hell Out of Healthcare by Nick JacobsWhen healthcare reform is discussed, it is personal.  It is also deep, and it is costly, but the bottom line always comes back to this: “How do you put a price on 17 months?”  In my book Taking the Hell out of Healthcare, I discuss the journey that my father and our neighbor took together over about a 17 month period.  Both diagnosed with lung cancer, my father decided to go for it all.  He had surgery, chemo, radiation, more radiation, and more chemo.  My neighbor, a man without significant health insurance coverage, decided to spend his time with his family.  They both died on the same day.  My father died in a cold, tertiary care hospital where no clergy was present, his family members were not all able to be there with him, and it was over.  In contrast, our neighbor died peacefully in his home, surrounded by his entire family.

Ms. Bennett did say that she was glad that she was not a bureaucrat having to deal with these issues.  Frankly, I wish that she was!

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Inflationary Indices

February 19th, 2010

As the pulse is still an indicator of health in human beings and other animals, health care-related inflationary indices can be a measure of economic health, growth, and change in our business.  After perusing nearly six pages of single-spaced inflationary projections in an Amerinetproduced report, two jumped out at me, the two highest.  One was more significant than the other, but both tell their own story.

Photo credit: Eric Zamora - University of Florida IFAS

Ice-covered Orange Tree Photo credit: Eric Zamora - University of Florida IFAS

The first was coffee/juice, and the projected costs for these two items are up 10 percent. At first my curiosity was piqued by this, but then I saw the explanation further over on the page.  It said that these increases were based on the recent freezes in Florida, which will have a significant impact on juice pricing.  I guess that makes sense.  The trees and oranges froze and were ruined, but it was interesting to me that every other orange-growing country in the world hadn’t jumped into the market and taken advantage of this shortage situation.

The even more difficult quandary created by this coffee/juice category, however, was that the coffee wasn’t explained.  Surely, everyone knows by looking at a world map in Starbucks that coffee comes from places that are not Florida. Maybe it’s just a “calf path” item. You know, some ancient, primeval calf made a trail in the woods named “coffee/juice” and we still follow that path today.

I’m sure that many of you are now wondering what the second category is, the second highest predicted commodity increase for health care, and, honestly, I can’t wait to tell you.  Why am I excited about this one?  It’s because, you see, it is a NIGYSOG (Now I’ve Got You, You Son of a Gun) moment.  For nearly five years, I’ve been predicting some very obvious changes that are about to sweep through the healthcare delivery system.  Our blogs, newspaper columns, and speeches have all directed you toward these changes, and over and over, the vast majority of healthcare management professionals have either ignored or rejected these pronouncements; sometimes out of fear and sometimes out of a “wake me when it gets here” mindset.  Honestly, when it comes to prognosticating, it made me feel like Punxsutawney Phil.  (Oh, and what was that advertisement I read today?  “You have just survived the worst snow storm in this area in the past 100 years.”)

The second most highly inflationary bell ringer from the Amerinet report is one that spot-on supports our predictions completely.  (Drum roll, please.)  It is biotech products.  The prediction is that the cost of biotech products will increase an average of about nine percent.  Upon examining the comment section beside this category, the following sentence appears:  “Increased demand will drive these price increases.”

Windber Research Institute - Image by PlanetRussell.net

Many of you may still be scratching your collective heads in wonderment.  “What are ‘biotech products,’ and why should I care about them?,” you may be asking.  Let’s take a quick historic look at life in the biotech lane.  In 2001, when we co-founded a research institute that had specialty areas in biomedical informatics, tissue banking, proteomics, and genomics, it cost approximately $100,000,000 (that’s 100 million) to map ONE human genome. This year, that number will fall to below $500. If you take that ratio of product-to-cost and project it forward, it doesn’t take too much imagination to conclude that not so many years or months from now, your physician will potentially have (or want to have) access to your molecular profile.  It will provide insights into your personal health that were heretofore unavailable, even unimaginable.

Once issues involving insurance coverage, confidentiality, and ethics are resolved satisfactorily, these tests will become a routine part of your annual physical.  Complete Blood Counts, lipid profiles, prostate or breast testing, and genomic and proteomic analysis will provide your caregiver with answers that make the practice of medicine until now seem hit-or-miss by comparison.

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