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Leading Change HFMA Metropolitan New York Chapter Joseph A. Levi 52 nd Annual Institute Debora Kuchka-Craig, FHFMA HFMA National Chair and Corporate Vice.

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Presentation on theme: "Leading Change HFMA Metropolitan New York Chapter Joseph A. Levi 52 nd Annual Institute Debora Kuchka-Craig, FHFMA HFMA National Chair and Corporate Vice."— Presentation transcript:

1 Leading Change HFMA Metropolitan New York Chapter Joseph A. Levi 52 nd Annual Institute Debora Kuchka-Craig, FHFMA HFMA National Chair and Corporate Vice President, Managed Care MedStar Health, Columbia, MD March 10, 2011

2 The Crisis May Seem to Be Over... …this month marks the one-year anniversary of the Affordable Care Act The recession─at least technically ─ has ended... 2

3 ...But the Long-Term Issues Remain Exponential Growth in Healthcare Expenditures Need for Better Access to Insurance Coverage Substantial Opportunities to Improve Quality of Care and Patient Outcomes No Correlation Between Expenditures and Quality REFORM DRIVERS 3

4 Kotter’s Eight-Step Model for Leading Change Source: John Kotter, “Leading Change,” 1996 Create Urgency Form a Powerful Coalition Create a Vision for Change Communicate the Vision Remove Obstacles Create Short Term Wins Build on Change Anchor Change in Corporate Culture 4

5 Create a Sense of Urgency 5 Step 1 As We Navigate a New Phase of the Crisis Emergency Phase Leaders sought to stabilize the situation and buy time Adaptive Phase Leaders must tackle the underlying causes of the crisis and build the capacity to thrive in a new reality

6 Step Up: Healthcare Finance Must Take the Lead Source: hfm magazine. August “Somebody has to do something, and it’s going to be— and it has to be—you.” Former Senator and Senate Majority Leader Bill Frist, MD Speaking at HFMA’s ANI: The Healthcare Finance Conference, June 2010

7 Form a Powerful Coalition “Leadership has nothing to do with titles; it has everything to do with, “Do you inspire other people? Do they want to follow you? Do they want to be with you?” 7 Step 2 Other Administrative Departments Physicians Nurses & Other Clinicians Other Entities Within Your Health System Payers Patients & Community Members Finance -Tom Atchison, author of Followership: A Practical Guide to Aligning Leaders and Followers

8 Healthcare Coalition Success Stories For more information, read HFMA’s Leadership e-Bulletin, available at “Transforming Revenue Cycle” (Providence Health & Services CA region): Oct issue.www.hfma.org/leadership “Funding a Capital Project” (Beatrice Community Hospital/NE) : Dec issue. “Redesigning Primary Care” (Fairview Health Services.MN): Nov issue.. 8 TRANSFORMING REVENUE CYCLE A California healthcare system created core revenue cycle teams with representatives from 10 departments across all system hospitals. Improvement: $9.4 M FUNDING A CAPITAL PROJECT Community banks and residents bought 38% of the $45M in bonds that a rural Nebraska critical access hospital used to fund construction of a replacement facility. REDESIGNING PRIMARY CARE A payer funded an initiative to make a Minnesota healthcare system’s primary care clinics more efficient and patient-centered. Physicians, nurses and other clinicians provided the ideas.

9 Create a Vision for Change 9 Step 3

10 “The people who really succeed in this field have a vision. They have a high degree of motivation, and they are out to make things better—to do good and to change the world on whatever scale they can. They work hard, they have an end in mind, and they will acquire whatever skills and training and knowledge they need to get there. ” Mary Stefl, professor and chair of the department of healthcare administration, Trinity University, San Antonio, Texas, and a consultant for the Healthcare Leadership Alliance Competency Model 10

11 Communicate the Vision Step 4 11

12 Communicating the Vision Success Stories For more information, read HFMA’s Leadership, available at Virtua case study : Spring/Summer 2010 issue. Virginia Mason and Kettering case studies : Fall/Winter 2009 issue. 12 REINFORCING STRATEGIC PLAN Virginia Mason leaders use this pyramid graphic to continually communicate and sum up the health system’s vision and strategic plan. UNIFYING GOALS Virtua focuses around the united goal of providing an outstanding patient experience. All improvement projects relate to one of the five points of the star. IDENTIFYING WHAT TO CHANGE At Kettering, team members can easily see how close they are to achieving annual goals based on where the darts fall on the bulls-eye graphic.

13 Remove Obstacles 13 Step 5

14 Leaders Will Confront Obstacles on Three Levels 14  Resistance to change  Risk aversion  Need to develop new skills  Need to relate differently to team members INDIVIDUAL & INTERPERSONAL LEVEL 1  Incentive structure that does not reward risk-taking & change  Lack of organizational nimbleness  Limited resources for supporting change ORGANIZATIONAL LEVEL 2  Divisive political differences  Complex web of regulations  Misaligned provider incentives HEALTHCARE DELIVERY SYSTEM LEVEL 3

15 “... a leader needs to know and understand his or her people. You cannot lead without knowing the needs of your people—what drives them, what makes them do what they do. Once you understand some of the psychology of that, then you can give them opportunities to succeed based on their own psychology of success.” Kerry Gillespie, FHFMA, vice president, operations, Community Health System, Inc., Brentwood, TN, and a member of HFMA’s Tennessee Chapter 15

16 Create Short-Term Wins “A journey of a thousand miles begins with a single step.” - Lao-tzu, Ancient Chinese philosopher 16 Step 6 “Don’t be afraid to start small.” - Marty Manning, Advocate Physician Partners

17 How it Manifests at the Hospital Level Short-Term Win Short-Term Wins Help Bridge the Gap to Long-Term Solutions For more about Presbyterian Hospital’s navigator program, see the Oct Leadership e-bulletin, available at 17 Healthcare Delivery System Issue  In 2008, the U.S. spent $14 billion treating 115 million people who visit the ED for a non-urgent condition  Payers no longer want to pay ED prices for non-emergency care  New Mexico’s Presbyterian Hospital launched a patient navigator program that deferred 60 unnecessary ED visits within a month after its launch. The program is expected to save $10M - $15M over five years

18 Build on Short-Term Wins “Leadership is invaluable to surviving Step 7. Instead of declaring victory and moving on, transformational leaders will launch more and more projects to drive change deeper into the organization.” -John Kotter 18 Step 7

19 Building on Short-Term Wins Success Stories Floyd Memorial Hospital For more information, see “The Value Equation” in the Nov hfm, available at Catholic Health East 19 One-year initiative to reduce supply chain costs by $1.1M Small pilot program to prevent readmissions Two-year savings of more than $4M  Increased collaboration  Enhanced quality of care  Reduced waste hospitalwide Number of participating physicians nearly tripled in two years  Avoided payment denials from direct readmissions  Increased physician satisfaction

20 Anchor the Changes in Corporate Culture “Company cultures are like country cultures. Never try to change one. Try, instead, to work with what you’ve got.” -Peter Drucker 20 Step 8

21 Corporate Culture Success Stories Read an interview with Advocate’s Lee Sacks, MD, in the Dec hfm, available at SHARP HEALTHCARE 21 ADVOCATE HEALTH CARE  Advocate’s balanced scorecard centers around health outcomes  40 percent of managers’ merit compensation increases are based on health outcomes  Their publicly available Value Report documents quality and cost achievements  Sharp aligns all strategic initiatives under six pillars of excellence  Leaders and staff come together at an annual All-Staff Assembly to recommit themselves to their mission  Sharp produces an annual TV documentary that shares real-life experiences with the community

22 Build on Finance Professionals’ Change Leadership Strengths “CFOs are often better leaders than they think they are. They are good at setting goals, measuring results, and looking at variances.” -Quint Studer, CEO & Founder, Studer Group “The CFO is really in a role to help the various stakeholders understand how the pieces fit together.” -Noblis Health Innovation Senior Principal, Paul Breslin “When asked what role finance officers can play in transforming our healthcare system, David Walker said to remember what the ‘P’ in CPA stands for.” -HFMA Board member Edward Giniat, quoting the former U.S. Controller General & CEO of the Peter G. Peterson Foundation 22

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