Transformation Needs to be More Than a Buzzword

The CJR bundled payment model started on April 1st but many organizations have been surprisingly slow to adapt. We’ve heard a lot about how it’s “good to be bad” in the first couple years, creating a high episode price target and then banking on quick improvement in the second year of CJR to avoid penalties.

We’re not sure that this is the time to try to play the system. The shift calls for deep changes, core transformations that take time, foresight and iteration to play out correctly. And we say that knowing full well what a buzzword transformation has become. There’s a difference between transformation and improvement — improvement is about marginal changes to an inefficient system. Transformation is about reframing the entirety of the system — everything from the minutiae of daily activities, to the large abstracts of organizational values and goals.

Recently at a New York City Health Business Leaders panel on the changes the New York market will experience as it shifts from volume to value, Niyum Gandhi, EVP and Chief Population Health Officer at Mount Sinai Health System, went into the difference between transformation and improvement, and why it’s important to choose the former.

He put it like this: if you were a shipping company in the 1800s and it took 18 days to cross the sea, but a customer wanted it to be 13 days, you would build a faster ship. If the customer wanted 11 days, you would build a faster ship. If a customer wanted 8 hours? Now we’re talking planes.

“Yes we need to see improvement” said Mr. Gandhi. “But we also need to be building planes.”

The question is what does a plane look like? And then the question is, how do you turn an armada into an air force. And he pointed out that this transformation is even trickier than the analogy. How do you change a boat into a plane while it’s moving? We don’t get to stop and start from scratch. Leading organizations are tackling full scale redesigns as their practices are moving.

Gandhi explained that as they take a practice and try to turn it upside down there are steel cables of functionality holding it into place. He then has to decide which cables to snip. That’s why Gandhi has pulled together an interdisciplinary team of UX designers, industrial engineers and more to go about the work to turning their system inside out, and shaking off the excess weight.

Gandhi and his team are moving decisively and they’re not looking back. They understand that to be successful in value organizations need to move now and they need to move quickly from fee-for service to value-based care — there isn’t room to hang around in the middle.

“The math on one end works and the math on the other end works, but the math in the middle doesn’t,” said Gandhi. “That’s why we’re moving fast. That’s why we’re burning ships.”

Originally posted on the Force blog, MAY 25, 2016