The Story of Us


From the outset, HM has been about efficiency. And there was nothing wrong with that, for value is quality divided by cost. But in our story, we found that mere efficiency was not enough: The lowering of the denominator (cost) had to be met with an escalation of the numerator (quality) to ensure value.

And see us as being born in the right place at the right time. For with the national focus turning to the need for quality and patient safety, hospital medicine was in the right place and the right time to heed the call to action: appropriately stepping up to enact efforts to make the slope of the line (on a chart of quality vs. cost) “STEEEPER” … finding systems innovations to make care Safe, Timely, Efficient, Effective, Equitable, and Patient-centered.

There is nothing wrong with providing incentives for behavior; incentives work. But the danger arises when incentives are mismatched to behaviors.

Of course, the story continued with the Affordable Care Act and healthcare reform, greatly accelerating our evolution as change agents. And now we find ourselves fully invested in a “change the system” mentality, perfectly positioned to meaningfully change healthcare for millions of people. But threats loom—specifically, the “R” in the STEEEPER mnemonic: the risks to quality in the face of healthcare reform.

So in the next chapter of our story, I present to you our challenge: how to overcome the threats to quality in the context of healthcare reform. The first three are presented here; in subsequent articles, I will address the remainder. Overcoming all threats will hinge on mastering the four truisms of cultural change:

  1. Systems drive function;
  2. Every system is perfectly designed to produce the outcomes that it does;
  3. This is not an issue of people needing to try harder; and
  4. The “no blame” culture begins with a paradigm shift from the “person at fault” to the “system at fault.”

Threat 1: Failure to Fund Quality

SHM elected to merge its annual State of Hospital Medicine survey with the MGMA. Though not without risk, this has resulted in the anticipated benefits. The MGMA collaboration brings greater leverage in working with the C-suite, which is pre-programmed to react to MGMA surveys. From the most recent MGMA survey comes good news: The financial compensation for hospitalists has increased. A sobering insight, however, is that this increase in compensation has been met with a corresponding increase in work intensity—RVUs. Further, the link between RVUs and compensation appears to be tightening, quantifying what has long been of concern: The time devoted to the nonclinical “value added” duties of the hospitalist is shrinking.

The threat to the culture of quality is captured in the single question: How many RVUs is a quality-improvement (QI) project worth? I’m not sure we have that answer. But without an answer, it is difficult to believe that meaningful QI can be expected without time to do so. And again, as the gap between compensation and RVUs narrows, one is left wondering if there will soon be a day where there is no value-added time remaining to perform QI at all.

Fortunately, the Affordable Care Act might provide some movement in the right direction via value-based purchasing. Linking quality outcomes to financial reimbursement is a big step forward in the hospitalist’s quest to leverage the C-suite in trading RVUs for devoted QI time. Although we still are left asking the question of how many RVUs a QI project is worth, value-based purchasing at least sets the stage for the conversation. But in the interim, it is still upon hospitalists to design these QI projects, and to learn the skills necessary to see the design to its fruition.

Threat 2: Quality Stops at Core Measures

It is hard to argue that fulfilling “core measures” is a bad thing. Nonetheless, the core measures were not meant to be quality; instead, they were meant as surrogate measures of quality. The presumption of the core-measures initiative is that the system would exist without direct attention to the core measures, operating as it ordinarily would with generic attention to meeting all standards of quality for all diseases. And at some point in time, the core measures would be assessed to give an overall assessment of the system’s quality.

What has evolved, however, is a concerted attention to meeting the core measures, with little regard to the overall culture of quality.

Let’s say you were tasked with improving the public school system in your state. As a measure of the improvement, you choose five of the 1,000 schools as “core measure” schools. The state board of education is told that the performance of these five sample schools will be assessed at the end of the year, and financial support for the system as a whole will hinge on their performance. The intended result is that attention would be paid to improving the performance of every school in the system, and this improvement would be reflected in the performance of the five sample schools. The board of education could take the route of improving all schools, but the more pragmatic route would be to funnel all resources into these five schools, to the detriment of resources for the other 995 schools. The performance of the core measure schools would dramatically improve, and funding would be secured. But ask yourself: Did the performance of the school system as a whole actually improve?

Such is the risk of the core measures in healthcare. The original intent of the core measures was to instill a culture of QI for all points of care. And this has been a valuable contribution to changing the consciousness of the healthcare system. The presumption was that the core measures would be “seeds,” and that by emphasizing these select measures, the QI culture eventually would spread to all aspects of patient care. But this plan hinged on the presumption that that there is an unlimited amount of mental energy and resources to be devoted to all tasks within healthcare. The reality is that there is a fixed amount of intellectual energy and resources to be devoted to the various aspects of healthcare. One wonders if the overemphasis on meeting the core measures might actually have taken the wind out of the sails for QI in other non-core-measure patient care.

The implications are twofold. By definition, a core measure has to be applicable to all healthcare systems, and with a fixed amount of mental energy and resources, there is a real risk that what portion is reserved for QI finds its way only to the core indicators, especially if they are overemphasized in the system. The second implication is captured in our experience with time to antibiotics. With meeting the core indicator as the priority, many systems instituted the “work-around”: Give antibiotics to every patient presenting to the ED, and you will be sure to have met the four-hour window in the core indicator. The result was an exponential increase in inappropriate antibiotic administration and radiographic tests, all because meeting the indicator became more important than the overall goal.

As stewards of the hospital system, it is upon us to ensure that the original intent of core measures remains secure: The core measures seed a culture of quality, but do not become ends in and of themselves. QI apart from the core measures must remain an equal priority, and it is the hospitalist who will be central in ensuring this comes to fruition.

Threat 3: Misplaced Incentives

There is an interesting anecdote in Steven Levitt and Stephen Dubner’s book Freakonomics.1 The story begins with a daycare center struggling with a problem: Some parents are showing up late to pick up their children at the end of the day, and this is costing the center in the way of overtime charges for the staff. To solve the problem, the center elects to institute a financial disincentive: Those showing up late to pick up their children will pay a modest financial penalty.

Fast-forward to months after the policy was put in place. The result? An exponential increase in the number of parents showing up late to pick up their children.

How do you explain worsening performance in spite of a financial disincentive? The answer resides in understanding human behavior. According to the authors, there are three primary motivations in life: financial, social, and moral. As ugly as it sounds, the decisions people make in life are driven by one of these three motivations. There is nothing wrong with providing incentives for behavior; incentives work.

But the danger arises when incentives are mismatched to behaviors. For example, if a financial outcome is the goal, then financial incentives make sense. If a social outcome (people should play better as a team) is the goal, the social incentives make sense (public recognition). But when the incentives get misaligned with their respective goals, trouble results.

What went wrong with the daycare’s plan is simple—most of the parents were motivated to pick up their children on time out of moral (“I gave my word”) or social (“I don’t want to be talked about by other parents”) incentives. But once a financial incentive was offered, the daycare center had essentially given the parents a way out in absolving their social and moral obligations. The parents had essentially cost-adjusted their behavior.

If you think this couldn’t happen to the healthcare system, let me ask you this. As a hospitalist, I see all of my patients early in the morning, because I see it as part of my obligation to the hospital team to discharge patients by 11 a.m. (social motivation).

But what if the CEO released this directive: “You will see all of your patients early in the morning, or you will take a $1,000 a year pay cut.” Is it possible that I might cost-adjust the $1,000 in exchange for sleeping in a little later and not having to deal with the morning traffic? I don’t know.

When it comes to financial incentives, there is a valley in the U-shaped curve. When the financial incentive is trivial, it is disregarded and the social/moral motivations of behavior persist (the kids are picked up on time; I persist in seeing patients early in the morning). When the financial incentive is huge, the financial incentive trumps all social/moral motivations, ensuring compliance with the goal behavior (every kid is picked up on time to avoid a penalty; I see all patients early in the day to avoid a larger penalty).

But in between is the risk zone: When the person feels they are paying an appropriate penance for not complying with the goal behavior, the financial disincentive absolves any social/moral guilt.

Healthcare reform is about incentives—and there is nothing wrong with that. But as the stewards of the inpatient healthcare system, it is upon us as hospitalists to ensure that the incentives remain matched to their intended goals, and that the untoward consequences of the incentives do not adversely affect the quality and safety of a patient’s care.

It is safe to say that the Affordable Care Act of 2010 moves us closer to a true environment of quality and patient safety. But it is equally safe to say that meaningful change will require more than what the law can provide. As stewards of the inpatient system, we have a responsibility to ensure that the healthcare system, particularly in how it responds to incentives, evolves to remain patient-centered, effective, and safe.

The next chapter in our story—the hospitalists’ story—will be one of accountability and responsibility. While there are things the government can do, the majority of what needs to be done will come directly from us. TH

Dr. Wiese is president of SHM.


  1. Levitt SD, Dubner SJ. Freakonomics: A Rogue Economist Explores the Hidden Side of Everything. New York City: William Morrow; 2005.

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