When Texas Health Resources began designing its new hospital in north Fort Worth, company executives made an unusual move.
They consulted physicians.
Wenjie Tang Miao is president of Texas Health Alliance, which is expected to open its doors in September at Interstate 35W and Golden Triangle Boulevard.
"We had a very rare opportunity to build a hospital from scratch. We asked ourselves what the next generation of health care would look like. Who would know better than those who take care of patients every day," she said.
"Sometimes, the [hospital] structure kind of inhibits you. Medicine has changed since hospitals were built 40 to 60 years ago," said surgeon Nabeel Shabout, one of six doctors involved in the project. Newer technology makes things different. This is where physicians want to be. We want input from the get-go."
Who Runs the Hospitals?
Most patients would be surprised by how little involvement their physicians have in running health care organizations.
Non-physicians lead the vast majority of U.S. hospitals, but it was not always that way. A century ago, physicians led about one out of three hospitals. That has dwindled to less than 2 percent of hospitals.
Health care organizations generally are huge and complex organizations. Running them requires physicians to know at least as much about business administration and the health care system as they do about treating patients.
The late management guru Peter Drucker once said that the four hardest jobs in America, in no particular order, are President of the United States, university president, hospital chief executive officer and pastor.
There is a movement afoot to put physicians into leadership positions because the new reform law is changing the health care landscape. Health care organizations now must focus as much on quality as financial performance. Patients and policymakers are demanding greater transparency, patient safety, cost effectiveness and accountability.
Doctors and Basketball Coaches
A 2011 study by a British researcher found that hospital quality scores were about 25 percent higher at hospitals led by physicians. Scores for cancer care were even higher. The same researcher also studied National Basketball Association coaches and found that teams coached by former star players improved substantially during the first 12 months.
Like star athletes, physician leaders can be role models and clearly have an advantage when recruiting clinical talent because they have "walked the walk."
Dr. Russell Dickey, former chief of staff at Arlington's USMD Hospital, said only physicians could effectively change the health system.
"Physicians have been slow to get involved [in health reform]. We left it up to others - employers, insurance companies and government - to fix the problem. We abrogated our responsibility. Now there is an attitude [among physicians] of "All right, let's fix this." Doctors have to drive that change," Dickey said.
USMD is a group of physician-owned hospitals and a joint venture with non-profit Texas Health Resources, the largest health care system in Dallas-Fort Worth with 24 owned, operated, joint-ventured or affiliated hospitals. That includes Texas Health Resource Harris Methodist Fort Worth.
Susan Bailey, a Fort Worth physician with an allergy and immunology practice, said the trend toward more physician leadership began a decade or more ago - including in politics. Bailey, a former president of the Texas Medical Association (TMA) and an officer in the American Medical Association, said more physicians are running for state legislatures and Congress as health-insurance programs claim increasing shares of government budgets.
"There is an imperative there to have people who have dealt with [Medicare and Medicaid] and who know how they work and can improve," she said.
Jim Jacobson is a physician and consultant for large medical groups and insurance companies.
"Physicians have a unique position in the health care arena," Jacobson said. "They are at the center of patient care. They can look at patient care from the inside out. If they are a physician leader, they can also look at it from the outside in, taking into account both the clinical and business aspects of the organization."
Physicians are responsible for about 75 percent of the costs incurred by health care organizations. Physicians deliver the product - patient care - and control service quality.
Kings of Their Offices
Physicians by nature are fiercely independent. Most are in solo or small practices, with little outside accountability. The teamwork required in integrated care organizations is a foreign concept. Many see the study of leadership as weak and lacking the rigor of science.
"You are taught to examine the patient yourself and do your own lab work, even if it already has been done by another doctor. That is the antithesis of teamwork," says Dr. David Winter, president and chairman of the board of Heath Texas Physicians Network. "Clinical medicine has become so complicated that the best doctor on his best day can't do everything right [independently]."
Jacobson said physicians have a natural tendency to work alone.
"We have to learn the role of team player. In the past, we were the kings of our offices, with little regulatory oversight or review. We made all the decisions. Now there is a huge amount of oversight by insurance companies who credential [physicians], review charts and ask for a lot of information," he said.
Bailey agrees.
"Doctors are trained as individuals who make decisions and take an oath to always take care of their patients regardless of circumstances. That is not a corporate mentality or necessarily a good political strategy," she said.
Lack of Trust
According to a 2010 PricewaterhouseCoopers survey, one of five physicians does not trust hospitals. Conversely, 60 percent of hospitals report it is difficult to get information from physicians to improve patient care.
Some health care executives simply believe physicians cannot lead. Jacobson said a hospital association executive spoke to a graduate-level course he was teaching and joked that physician leadership was an oxymoron.
Doug Hawthorne, Texas Health Resources chief executive officer, said the physician involvement in designing Texas Health Alliance is part of a larger strategy called "accountable clinical management." The goal is to give clinicians a greater voice in the organization so THR's goals are aligned and focused squarely on the patient.
Hawthorne said THR is evolving from a hospital system into a health care system that delivers care from birth to death. He said THR has "imminent" plans to reveal a new organizational structure that will "lead us to where health care is going. And there will be more physician leadership at the highest level."
Most physicians who rise to administrative positions lack formal training in organizational and behavioral leadership.
Dickey said USMD identifies four to six promising candidates each year for weekend training to cultivate physician leaders. A physician working in a hospital cannot "just show up for work anymore. You have to participate There is a lot of work behind the scenes for the hospital to be successful. The government requires physicians be much more involved than they used to be. And that's a good thing," he said.
TMA recently developed a Leadership College that teaches physicians how to run meetings and give speeches and provides mentoring for aspiring leaders.
"I learned these skills over a 25-year career, and [the participants] learn them in less than a year," Bailey said.
Physician leadership is broader than simply running hospitals. Doctors also serve as chief medical officers, head clinical department and often serve on hospital boards of directors. However, they often are promoted because of clinical or academic success rather than leadership skill or readiness.
Health care organizations are preparing to create accountable care organizations that focus on population health, install electronic medical records, improve quality and patient satisfaction, and reduce hospital admissions. New health care delivery systems emphasize teamwork.
All of that requires physician cooperation and engagement.
Job Satisfaction
Declining Physician career satisfaction has been waning. In 1973 - when Marcus Welby, M.D. was one of the most popular shows on network television - only 15 percent of physicians doubted their career choice. By 2002, more than half of physicians more than 50 years old said they would not choose medicine as a career again.
Six of the top seven sources of dissatisfaction are linked to the leadership of health care organizations. They include cost cutting, inadequate time for research and teaching, encroachment on physician autonomy and the sometimes-corrosive hospital organizational culture.
Such discontent can be downright dangerous. Dissatisfied physicians are more likely to practice poor clinical management, have higher rates of medical errors and contribute to higher health costs.
Physician leaders can take patient care and advocacy to a higher level, transforming their professional ethics and compassion into institutional policies and affecting far more lives.
Under health reform, HTPN's Winter said, "We have a lot of opportunities to do things right. However, that won't happen without physician leadership. To get physicians to change requires physician leaders."
Heath Texas Physicians Network is a wholly owned subsidiary of Baylor Health System. Baylor has invested in extensive training programs and created "physician champions" who encourage colleagues to adopt evidence-based methods. Established in 2000, the program has an annual $3 million budget and includes 40 champions who either operate systemwide or are based at individual hospitals.
Implementing guidelines and quality improvements requires time and persuasion, especially because physicians often are not directly employed by the hospital. The champions do most of the heavy lifting.
Dr. Carl Couch, one of the founders of HTPN and president of the Baylor Quality Alliance, said he has seen the physician's role at Baylor evolve from being simply consulted to being highly valued. He noted that more than 20 physicians now are in influential corporate positions.
"We have a tremendous relationship with the medical staff," Chief Executive Officer Joel Allison said. "There is mutual trust. We wanted to bring doctors and nurses into leadership positions. [Baylor] is a clinical enterprise."
Baylor has also embraced joint-ventures hospitals and facilities with physicians. Nearly 10 percent of Baylor's 4,500 physician affiliates have ownership stakes in its 10 joint venture hospitals. The joint ventures account for about 20 percent of Baylor's revenue and are more profitable than the system as a whole.
Sense of Pride
Physician-owned hospitals reliably have the highest ratings on quality and patient satisfaction by Consumer Reports and Medicare's Hospital Compare website.
Dickey said physician owners have a sense of pride that does not exist under other ownership structures. Although the chief executive officer and chief financial officer are not physicians, Dickey said the fact that physicians control the board of directors has a large impact on the institution's clinical culture.
"It's the difference between being a renter and a homeowner. The physician says, "This is MY hospital. I'm going to fix it if it's not right." Hospitals that are not doctor-controlled often make decisions that physicians don't necessarily agree with," he said.
Some community hospitals have been critical of physician-owned facilities, charging that they "cherry pick" affluent and less sick patients for the most profitable procedures such as cardiology and orthopedics.
Dickey, who points out USMD does not include cardiology or orthopedics, said the Texas Health Resources joint venture works for both entities.
"Without the partnership, we would be hurting them, and so a portion of their profits stay here in the community. [USMD] gets access to bond financing we would not have otherwise."
THR's Hawthorne also credits physician engagement and leadership for the high quality and patient satisfaction scores at its joint venture hospitals.
Its 137-employee hospital in Southlake has been named one of the nation's 100 best places to work in health care, according to Modern Healthcare magazine, four years in a row. About 90 percent of its patients would recommend the hospital to family and friends, compared with a national average of 69 percent.
The health-reform law currently bans creation of new physician-owned hospitals.
Hospital-Physician Alignment Regardless of how health care reform plays out, the traditional tension between hospitals and physicians is melting out of necessity. Hospitals need physician buy-in as they enhance quality to meet health reform's imperatives. Physicians are abandoning independent practice in droves as they face decreasing revenue and government imperatives for electronic health records.
In many states, hospitals cannot directly employ physicians by state law. Therefore, physicians act as independent contractors who autonomously care for patients, using hospital equipment and staff as their "workshop."
Physicians visiting patients in hospitals are becoming a relic of America's medical past. Many community-based physicians do not mind this, because the travel time between the office and hospital is time they cannot bill.
Hospitals increasingly have been contracting with "hospitalists," or physicians who work exclusively at the hospital to handle admitted patients.
Hospital-physician relationships have pivoted swiftly in the past few decades. Hospitals catered to physicians in the 1970s and 1980s because they competed for referrals. Then the landscape changed and the seeds of mistrust were sown.
The twin threats of Clinton administration health reform and managed care motivated hospitals to buy hundreds of physician practices to create integrated networks. They later unloaded the practices, because both threats shriveled and hospitals could not manage them profitably.
Physicians struck back by investing in outpatient centers and specialty hospitals, siphoning away profitable business. Medical technology became safer, cheaper and less capital-intensive, which encouraged physicians to move their business away from hospitals and into smaller clinics. Outpatient surgeries accounted for two-thirds of all surgeries performed from 1996 to 2006, according to the U.S Centers for Disease Control. Surgeries in freestanding centers tripled while hospital outpatient surgeries were relatively unchanged.
Hospitals working collaboratively with physicians has always been a core strategy for hospitals. Doctors control 70 to 80 percent of hospital admissions. Fewer than 60 percent work exclusively with one hospital.
Shrinking Medicare reimbursement will squeeze hospital margins throughout the coming decade. A PricewaterhouseCoopers analysis estimated that, without reform, Medicare rates would have risen by 27.5 percent over that period. Under health reform, the increase will be 11.9 percent.
The Medicare value-based purchasing program will begin paying hospitals based on patient satisfaction and quality of care, reducing payments for those in the bottom 25 percent. An average-size community hospital could lose more than $1.4 million annually if it receives poor quality scores beginning in 2013.
The Time Has Come Under health reform, the most successful hospitals will be those that align tightly with physicians who answer the call for safer, more efficient, effective and patient-centered care.
Physicians are ready to answer that call. The number of hospital-owned physician practices reached 55 percent in 2009, up from 50 percent in 2008 and 30 percent five years ago, according to the Medical Group Management Association.
Merritt Hawkins, a physician-recruiting firm, reported that more than half of physician job searches were for hospitals for the year ending March 2010, compared with 45 percent the previous year and 19 percent five years earlier. The percentage of physicians who own their practices has been declining about 2 percentage points a year for the past 25 years.
According to a 2010 HealthLeaders Media Intelligence Unit report, three out of four hospital executives said they were getting more employment requests from physicians and they planned to hire more physicians within the next three years.
More than half of physicians believe they will become more aligned with hospitals, according to the PricewaterhouseCoopers survey. Further, roughly the same percentage wants to align more closely with hospitals to increase their income.