The news is full of talk about the rising cost of healthcare. But I’m always confused, because I don’t understand what costs are rising. At the same time there are reports of many doctors leaving certain areas, physical and specialty, because their pay can’t keep up with their bills (like paying off medical school, insurance, office rent, etc.). Nurses certainly aren’t being overpaid, so what costs are rising and why?
Well, I finally heard an answer, and it was very interesting. The NPR (National Public Radio) show Marketplace spoke with someone who had an answer. Apparently I’m not the only person thinking about this, and someone much smarter and more ambitious decided to look into it. Dr. Atul Gawande wrote and article and spoke with Marketplace host Kai Ryssdal about what he found.
Dr. Gawande looked at the healthcare costs in McAllen, Texas, which has one of the highest per capita healthcare costs in the nation, and the Mayo Clinic, which has one of the lowest costs of healthcare in the country. Why the disparity, especially given the reputation of the Mayo Clinic. As I said, the answer is interesting, and ties directly to this blog’s discussion of Business Operations.
It turns out that two of the primary causes of high healthcare costs are some of the same issues we find in Operations. The first issue is fragmentation. In McAllen, Texas, patients shuttle between many different facilities and service providers. There is no clarity to care, and also no central person or place dedicated to preventive care. This sounds exactly like the operations of many organizations with no clearly defined direction and plan to get there. In other words, no Goal Attainment System in place: Goal Definition, Action Plan, Performance Measurement System.
The second issue is the bias towards action. In McAllen, just about every test and procedure that can be performed is performed. There is no integration between the disparate service providers. And the natural human tendency to “do something”, even when you’re unsure of what to do, is in place. The problem is, sometimes it’s better to do nothing. At least not right away. Study and analyze the situation first, then propose a change, then implement it. Sounds like Six Sigma (the Six Sigma management system). I heard an interesting piece (public radio again) about human’s bias towards action a couple of weeks ago. Even when evidence proves that it’s better to do nothing, most people “do something.”
The thing I found most interesting was a study about soccer (football to the rest of the world) goalies and penalty kicks. This study proved that a goalie is more likely to block a penalty kick if he or she doesn’t move, meaning doesn’t jump left or right. But goalies almost always move. Even when not moving would be better. I’ve seen many organizations feel the need to do something, anything, rather than take the time to look at the issue and develop a better solution.
Maybe your new motto should be “Just do nothing”.