For-Profit Hospitals

Readers’ comments online regarding The New York Times article, “A Giant Hospital Chain Is Blazing a Profit Trail” (Creswell and Abelson) express disgust at HCA’s prioritization of financial gain. However, given that all health care facilities struggle with the often competing demands of serving patients and generating revenue, I’d like to dedicate this post to examining more closely just what I find problematic with HCA’s approach and how it compares to the other hospitals' practices.

First, there’s the concern that profit-seeking will continually come at the expense of patient care. Patients have been wrongly screened out; those who are admitted have been treated inappropriately as doctors make decisions based on what will generate hospital profits (e.g. ordering unnecessary cardiac surgeries); and these instances have given people reason to question HCA’s priorities. HCA appears to be giving improper attention to customers presumed to not be “profitable,” and is willing to cut corners, safe in the knowledge that even if negative outcomes result the money lost in settlements will be more than repaid in profits. Both of these problems have been true of businesses in other industries as well. When I’m at a restaurant, waiters often notice my age (and my standard “just water for now”) and proceed to be inattentive to me for the remainder of the meal, seeking out their big tips elsewhere. (My friends and acquaintances have described similar treatment, which anecdotally suggests that I don’t just happen to frequent snooty restaurants or to have a particularly unfortunate rapport with waiters.) And Walmart has been a frequent recipient of allegations regarding bribery, corruption, discrimination, employing illegal immigrants, overtime, gender bias, and destruction of evidence. Though having an inattentive waiter isn’t life-threatening, having an inattentive nurse is. And though Walmart’s unethical actions have had a negative impact on thousands of employees, they haven’t led to significant physical damage or death. Government officials can attempt to hold businesses accountable, but if their attempts come too late in the case of HCA people’s lives are at stake in a way that is unparalleled in other industries.

Then there’s the added problem of HCA leadership associating success with instating effective regulations, requiring its employees to move away from making independent judgments in favor of compliance. HCA leadership consists of members of the Board of Directors, whose members also serve on the Audit & Compliance, Compensation, Nominating & Corporate Governance, and Patient Safety & Quality Committees respectively, and only one of whom holds an M.D. (Stockholders also get to approve how these Committees are structured.) Regulations are inherent in the legal framework that dominates the health care industry, and most hospitals are governed by an administration of non-M.D.s. However, at HCA the policies are more clearly aimed at efficiency and profit gain: they have used a successful ad campaign to increase their number of clientele, serve only those who can pay, and keep operating costs to a minimum. From the perspective of these board members, further success depends upon emergency room doctors following screening policies more consistently rather than overriding them; nurses increasing their efficiency in order to meet quality expectations with minimal staffing; and all employees working toward meeting hospital-defined targets. Patients too will have to give up their desire to be treated as unique individuals in favor of being lumped into categories based on diagnosis. These measures appear practical, but frustrate health care professionals who want to treat patients their way (a way often based on knowledge and varying amounts of personal experience) and patients who want personalized treatment. Some may equate these frustrations with self-centered stubbornness on the part of physicians, and excessive neediness in patients. But health care is complicated, and it’s hard to trust that all its nuances can be appropriately responded to by following protocols.

A related problem is the business model: HCA’s decisions are made without input from its employees, and its large profits aren’t felt equally by all its employees either.

In the December 2011 edition of Harvard Business Review, the cover article was about Morning Star, a large producer of the canned diced tomatoes and tomato paste found in cafeterias, schools, and businesses across the United States. Written by Gary Hamel, “First, Let’s Fire All the Managers” describes how the company has achieved success not despite but rather because of its lack of top-down administration. He writes of the inefficiency of a “top-heavy management model that is both cumbersome and costly,” describing how hierarchy “systematically disempowers lower-level employees,” shrinking their “incentive to dream, imagine, and contribute,” (4). At Morning Star, every employee writes a personal mission statement that outlines how he or she will contribute to the company, and negotiates Colleague Letter of Understandings (CLOU) annually with associates who are most affected by his or her work. Though this organization may appear disorderly, it has led to a flexible organization that better reflects the needs of the company—while fostering the personal engagement of employees. Additionally, all employees can issue a purchase order (though colleagues buying similar items meet to maximize buying power) and colleagues are responsible for hiring new staff when they feel overworked. At the end of the year, every employee gives and receives feedback from colleagues and every unit of the business explains its performance to the rest of the businesses; individual pay is dictated by how much value you add to the company. The result is a company with inventive, collaborative employees who take initiative and hold each other accountable, making well-informed and timely decisions that are rarely unilateral.

Hamel’s critique of businesses with a hierarchy of managers is an attack of HCA’s business model—and those of all large hospitals where physicians’ practices are increasingly regulated by hospital administrators. And his description of the “risk of large, calamitous decisions” for businesses with a management hierarchy is particularly significant as it relates to HCA, whose top management includes stockholders like Bain Capital. Morning Star’s business model sounds like a better fit. The medical community has already recognized the importance of collaboration, and doctors are increasingly working as members of teams alongside nurse practitioners, physician assistants, nurses, physical therapists, and social workers. But without an equal stake in the outcomes, and with others dictating protocols and standards of care, there is less incentive for personal investment in the quality of care delivered.

These problems—a lack of focus on quality patient care, overemphasis on adherence to hospital policies, and a top-down administration—aren’t unique to HCA. In a recent article in The New York Times, “Rationing Healthcare More Fairly,” Eduardo Porter described a recent study of hospital emergency rooms in Wisconsin that found that “victims of severe traffic accidents without health insurance got 20 percent less care… [and] the uninsured were 40 percent more likely to die from their injuries,” suggesting that linking hospital services with patients’ ability to pay is not unique to HCA. While at the Brigham and Women’s Hospital this week, I overheard nurses and doctors discussing whether or not to follow a hospital protocol that they deemed unnecessary (they opted not to). And in another recent Times article entitled “Should Hospitals Be Run by Doctors?” Tara Parker-Pope writes: “Among the nearly 6,500 hospitals in the United States, only 235 are run by physician administrators,” despite the fact that findings in the journal of Social Science & Medicine last year found that “overall hospital quality scores were about 25 percent higher when doctors ran the hospital, compared with other hospitals; For cancer care, doctor-run hospitals posted scores 33 percent higher.” I wonder how much higher the same quality scores would be if hospitals were run equally by all members of health care teams.

Questioning HCA’s practices is appropriate and warranted. But the concerns raised cannot be confined to HCA hospitals alone. 

A Response to Atul Gawande's "Big Med"

In Atul Gawande’s latest article for The New Yorker, he writes about the benefits of “Big Medicine,” anticipating that hospitals will increasingly give out medical care to patients as The Cheesecake Factory gives food to customers—efficiently and with high customer satisfaction at a low cost. He rightly notes that medical facilities are moving in this direction, citing Partners Healthcare and its competitors (Care Group and Steward Health Care System) as examples of large healthcare chains overtaking community-based hospitals. And this change makes sense, given that this increase in scale lowers costs while offering hospitals access to the up-to-date (expensive) technology we have come to rely upon. However, patient care would be better improved without the formation of these conglomerates, and without perpetuating our problematic reliance on medical interventions to fix personal, multifaceted problems.

Though Gawande mentions possible problems involved with the growth of large healthcare chains, these significant issues are mentioned only cursorily—and there are still others left unsaid. As he mentions, there is the significant problem of the savings from Big Medicine being reserved for the few, contributing to the ever-widening gap between the rich and the poor. As hospital chains expand, they will gain power over individual health care employees and patients, who will have trouble finding employment opportunities or services elsewhere (should they so desire). And they may want to if employees are treated similarly to the “frontline worker” Gawande mentions, who follows exact orders—creating the successful outcomes he touts—without reaping any of the financial benefits.

Having set standards of care, and people like Christina Monti (the Steward tele-I.C.U. nurse) checking in to make sure they are followed, is more than an annoyance; it may change the way health care professionals think for the worse. In “Don’t Fear The Cybermind,” a recent New York Times opinion piece, Daniel Wegner (professor of psychology at Harvard) explains how human minds remember only information that they alone are responsible for: his wife remembers where house things are while he remembers where care and yard things are, and they rely on each other to fill in individual deficits. He uses this evidence to describe how our computing devices help us to specialize, rather than hampering our capacity for storing information. But I wonder how it applies to jobs in which people are intently supervised. If doctors know someone else is checking to make sure everything is done properly, will they (intentionally or not) be less diligent and more careless? Who will ultimately take responsibility for ensuring patients are tended to? While having safety checks in place is a good thing (especially in vulnerable patients), if they come at the expense of initiative and thoughtfulness in those personally administering the care, they aren’t serving their purpose.

More important than hiring outside administrators to ensure procedures are followed is determining what mistakes are being made, and preventing them. If the issue is one of attentiveness, one fix would be to follow the advice outlined in Gawande’s The Checklist Manifesto: How to Get Things Right: have every employee write down a list of tasks to complete before, during, and after entering a patient’s room (a list that could be evaluated and updated at set intervals to ensure that it was up to date). If long term problems are due to employees avoiding inconveniences in place of caring for patients (another problem Gawande mentions), then employee training and workplace culture must be altered considerably.

The incentive to adapt and improve practices would be much stronger if patients could make informed decisions regarding where they sought care, and took responsibility for their own health. For example, what if patients had access to information regarding the possible hospitals and doctors they could visit prior to making an appointment? People other than Gawande’s mother should be able to select a talented doctor that matches their needs. Granted, the information sharing would have to be done carefully, so as not to unjustly inflate the successes of physicians practicing in wealthy areas on patients with fewer concurrent issues. And the focus should be on finding a doctor that matches a patient’s needs and priorities—maybe someone with experience in integrative medicine for someone interested in complementing traditional Western medicine with Eastern practices, for example—rather than on constant, unjust questioning of doctors’ capabilities. But with patients (and their families) more involved in their care—aware of their needs and willing to hold care teams accountable for meeting them, or else seek them elsewhere—these workers may be more motivated to make important improvements.

Please don’t equate my promotion of patient empowerment with requiring hospitals to achieve high “customer satisfaction,” as though healthcare is comparable to a business abiding by the Golden Rule “the customer is always right”. The fact is patients often aren’t right: they want to be able to eat before a procedure, even if it requires fasting for several hours beforehand; and they want enough medication to feel no pain, forgetting that pain is an important gauge of the body’s internal state and functioning. And some people are just more content than others, who (especially in stressful circumstances) may be prone to finding issue with everything and anything. To ask hospitals to please these people is to ignore what they were hired to do in the first place: to heal patients, even if at the expense of temporary discomfort. Though doctors would do well to listen to their patients—and some empathy and reassurances couldn’t hurt either—patients should also trust their respective doctors; the patient-doctor relationship is just that—a relationship.

This discussion of patient involvement leads to a larger discussion of patients’ role in their health—something fundamental to Gawande’s piece that is never addressed explicitly. When someone goes to The Cheesecake Factory, they choose to order whatever they please, whether or not the choice is good for their health. They may enjoy this freedom, and I don’t doubt that the food tastes good, which is certainly pleasing. But using this scenario as an analogy for healthcare is problematic. Healthcare isn’t about delivering patients what they want (though some would argue with me here); it is about facilitating healing and promoting health. Many people want to look and feel young indefinitely—a desire that is not only unachievable, but also works against their ability to deal realistically with the natural evolution in their capabilities that comes with age. Many people also want quick fixes to their problems, choosing to take medication for their chronic fatigue and stress-related diseases rather than work to improve their quality of life. Some want more than they need—more scans, more medications, more attention—while others (out of stubbornness or fear) avoid seeking out help. The doctor’s role is to recognize these differences in desires and behavior, and to work with each individual to improve their health appropriately.

The Wikipedia page for The Cheesecake Factory includes a category labeled “Controversies,” in which is written the following: “The Cheesecake Factory has been criticized for their heavy promotion of large servings of high calorie and high fat foods, and a corresponding lack of healthy menu options. For these reasons, the chain was dubbed the ‘worst family restaurant in America’ for 2010 by Men’s Health magazine. The average sandwich at the restaurant contains 1,400 calories.” People have the right to consume however many calories they choose, and to eat wherever they please. But, as this controversy demonstrates, catering to people’s immediate, instinctual desires (i.e. good tasting, inexpensive food) can have negative consequences in the long term. The Cheesecake Factory isn’t meant to engage in conversation with its customers about the potential issues resulting from their choice of menu item—that’s not why customers choose to eat there, and that’s not their role. Healthcare professionals are.