Leadership in healthcare management
Philosophies on healthcare management have gone through several iterations. In the earlier days, doctors were at the forefront of healthcare management. With the support of a small number of ancillary administrators, physicians were the cornerstone of both the business and practice of medicine. However, in the 90s, with the rise of regulation and administration, the organization of healthcare management changed. Currently, of the 6,500 hospitals in the US, only 235 are led by physicians (1). Oddly, the result of these changes has been surprisingly poor. Worldwide (especially in the US), healthcare costs have skyrocketed, employee satisfaction has decreased and patient outcomes are no better.
Our healthcare system has recently seen an explosion in the number of non-clinical administrators. Unfortunately, this has not led to an increase in quality or efficiency. Ryan Gamlin, a former healthcare consultant who is currently completing his medical studies, published results indicating that increased administrative spending has resulted in increased physician frustration, worse performance in indices of efficiency, and possibly even patient harm (2).
Dr. Amanda Goodall, a professor at the Cass Business school in London, has tried to bring a more scientific approach to studying these surprising findings. During her extensive research, she has coined the term “expert leader”. An expert leader is someone who has a technical background in the sector they are managing. Common examples include former NBA players who coach successful NBA teams, outstanding consultants who run consulting firms and universities led by proven scholars.
In her 2011 paper in Social Science and Medicine, she identified the CEOs from the top-100 ranked US News and World Report hospitals and determined whether they were headed by physician leaders or professional managers. She then compared the hospital performance by CEO-type. She found that even among these top hospitals, the presence of physician CEOs led to an extra 8–9 points on an index of hospital quality (p<0.001). Goodall argues that “expert leaders” have an advantage as they have a deeper and more intuitive understanding of the factors which lead to success in their fields.
Dr. Goodall’s conclusions have been reproduced in multiple other studies. In a 2013 paper by Veronesi et al, the authors found that a greater number of doctors on the board of directors of English NHS hospital trusts led to higher quality ratings and, more importantly, lower morbidity rates (4). Further research led by Nicholas Bloom demonstrated that physician managers were one factor associated with higher quality scores among 2000 hospitals in Brazil, Canada, France, Germany, India, Italy, Sweden, the UK and US (5).
As the pendulum swings back in favor of physician-leadership, medical schools are now integrating leadership development and business studies into their curriculums. One of the top medical schools in the United States, the College of Physicians and Surgeons at Columbia University, has a seminar series that spans the pre-clinical years of training called “Foundations of clinical medicine”. During these classes, students discuss healthcare systems throughout the world and explore effective strategies in healthcare leadership. Additionally, during the clinical years, students return to the classroom for 2-week long intersessions called “Mechanisms and Practice” where they focus on drawing from their fresh clinical experiences and discuss the challenges they experienced practicing in the real world of medicine.
Our current healthcare system is largely financially driven. As healthcare undergoes decentralization and globalization, we have an opportunity to build a smarter, more effective and more efficient system. MedCredits is a clinically-driven platform built by “expert leaders” from the ground up. With a team of US physicians, we aim to achieve a system in which patients and providers interact with minimal administrative barriers. It is critical that we learn from the past — and the data indicates that physician-leaders should be designing this new frontier of medicine.
(1) Gunderman et. al: Perspective: Educating physicians to lead hospitals. Acad Med: 84(10):1348–51, 2009.
(2) Gamlin, Ryan. “The Relationship Between Health Care Administrative Costs and Health System Efficiency: An International Comparison.” Abstract. Research Day Abstracts 4th Annual Lown Institute Conference, 2016.
(3) Goodall, Amanda: Physician-leaders and hospital performance: Is there an association? Social Science & Medicine: 73(4): 535–539, 2011.
(4) Veronesi et. al: Clinicians on the board: What difference does it make? Social Science & Medicine. 77: 147–155, 2013.
(5) Bloom et. al, 2014: Dose Management Matter in Healthcare? Retrieved from http://www.people.hbs.edu/rsadun/Management_Healthcare_June2014.pdf.
