When it comes to hospitals, either lead or be led

Most of the trouble I got into as a boy was not really my fault. I would be sitting around with friends and someone would come up with an idea, such as putting a can of spray paint in a fire to see if it would explode (it would). Because there were no other ideas on the table at that time – playing chess, for example – the momentum of the moment went with combustion. So, I was not really misbehaving, I was the victim of a bad agenda – yeah, that’s it.

Maine’s hospitals now find themselves in a similar situation; others are setting their agenda in the current debates about controlling hospital costs and improving quality. Hospitals are now being advised on how to run themselves by people and organizations that don’t run hospitals, and many of the ideas of the moment are coming from outside the hospital industry.

The latest collection of such ideas, and the most comprehensive, is the Draft Report of the Commission to Study Maine’s Hospitals, which was released in December (available at www.dirigohealth.maine.gov – click on News & Information). The commission was established by the state government’s Dirigo Health Plan to study Maine hospitals and make recommendations about how those hospitals could cut the costs of the care they provide in Maine. Its work resulted in a report that makes 19 cost-control recommendations and proposals to Maine’s governor, Legislature and hospitals.

The commission recommends dumping the idea that competition between hospitals is the key to controlling their costs, and suggests instead that all 39 Maine hospitals function collaboratively as one “system” of hospitals. It suggests hospital profit margins be controlled by voluntary limits, that hospitals centralize the provision of certain services, and that the state float a bond issue to help all hospitals put in electronic medical record systems. The commission proposes changes to Maine law that would allow health insurance companies to financially encourage patients to get certain care at hospitals outside their communities, if the insurance company can show that the quality of that specific care is better at the distant hospital. If adopted, these and other recommendations would radically alter how Maine hospitals are run.

There is something worse for hospitals than having someone else quarterback the game, however. The target audience of the commission’s end- zone pass on hospital cost control is a group desperate to control hospital costs; Maine’s political leaders and health care purchasers – businesses, health insurers, Maine Medicaid and many patients. They are increasingly skeptical that Maine’s hospitals are going to control their costs without being bludgeoned into doing it by the club of new state laws and by the market power of purchasers. They want their costs controlled, they want them controlled now, and they are not going to wait for hospitals to do it on their own. If they have to force radical changes – the commission’s or others’ – in how hospitals are managed in order to do that, so be it.

As a result of the commission’s work, Maine’s hospitals have now had the state’s health policy debate agenda concerning their futures set for them instead of by them. That agenda was set by a commission whose chairman once (very capably) ran a company that built ships, whose membership of nine included only two experts in hospital management, and whose goal was to tell hospitals how to run hospitals less expensively. Hospitals have to be wondering how the heck that all happened, since none of them would ever dream of being invited to tell Bath Iron Works how to build ships less expensively.

Maine’s hospitals can only regain their leadership and credibility on the issues of hospital cost control and quality by filling the debate with their own ideas and initiatives, and by demonstrating greater success in controlling their costs. Then they must do a better job of informing the public about their work. Despite having done a great deal already, by forming multi-hospital systems and taking other steps to control costs and improve quality, they are not seen as having done enough by those who pay the bills. Hospitals must do more, and tell their story more convincingly, if they are to retake leadership on hospital health care issues from those outside the industry, and to regain greater credibility with their customers on these issues. In order to do that, Maine’s hospitals must take a few key steps.

. First, hospitals themselves must be the source of the most aggressive and successful hospital quality initiatives in the state, and be recognizable as such. They should be more rapidly identifying and implementing quality initiatives at all hospitals on a systematic basis, and telling the public, purchasers and state government what support hospitals need for successful implementation of those initiatives. Special emphasis should be placed on quality initiatives that improve care and save money in the short term. Quality improvement is one of the best ways for hospitals to reduce costs without making large cuts in programs.

. Second, Maine’s hospitals should collectively identify and implement clinical guidelines that safely and effectively reduce avoidable hospital admissions, procedures and tests. This will cut costs in the near term. Every hospital should comprehensively practice observation medicine, for example, and every hospital should systematically be using validated guidelines to identify which patients with certain illnesses need admission and which can safely be treated at home. The job for purchasers and state government is to get hospitals the help they need in order to do this, including malpractice reform, support for guideline implementation costs, good reimbursement for observation medicine, etc.

. Third, hospitals need to report financial and quality data in a public fashion that is consistent between hospitals and easily understood. This will allow comparison of Maine hospitals to national benchmarks and each other. Much has been done in this regard in recent years, but more remains to be done to complete the job. The role of the purchasers on this issue is to use consistent financial methodology themselves, and to stop getting their quality data from sources that have no credibility in the medical profession.

. Finally, hospitals need to connect even more closely with their patients on these issues, because their patients are the real masters of the destiny of individual Maine hospitals. In order for that to happen Maine’s people must believe that no one is working harder to control hospital costs and improve the quality of hospital care than Maine hospitals themselves. And right now, I don’t think Maine’s people are certain of that; otherwise their elected political leadership would not have presumed to ask a former shipbuilder to tell hospitals how to do the job.

Erik Steele, D.O. is a physician in Bangor, an administrator at Eastern Maine Medical Center, and is on the staff of several hospital emergency rooms in the region.