It’s the Money

This time of the year is when various health care publications get around to looking at the past year’s events as well as making predictions for the new year.  They tap into pundits who usually have an agenda for many of their predictions, thus providing a  satisfyingly closed echo chamber.

So sitting on the beach I will weigh in with a comment or two about several developments of note for the new year.  I am fully aware that observing from the beach is easy which makes me an amateur pundit of sorts which does not please me.

Of special interest to me in the past year has been the progress of the merger of Dignity Health and Catholic Health Initiatives (CHI) to form a mega-monster health system consisting of 140 hospitals and assorted other endeavors.  The new entity will be called CommonSpirit Health which sounds like the expensive result of working with a branding consultant.  I don’t recall a St. CommonSpirit from my Catholic background so my guess is this is a further attempt to distance the new organization from its Catholic roots as has been the case with Dignity Health in recent years.

It is always difficult to merge two organizations, especially when neither one has been especially stellar financially.  CHI, in particular, has been hemorrhaging red ink for several years, no doubt the result of having achieved operating efficiencies from previous mergers of smaller Catholic health systems.  The expectation is that  by merging with Dignity Health, these financial problems will disappear.  Bigness overcomes such problems according to the financial analysts. How could they be wrong?

CommonSpirit Health, showing great courage and decision-making boldness, will be managed by co-CEOs, i.e., the former CEOs Of CHI and Dignity.  That is a surefire formula for success–for about two months.

My prediction–experience shows that even  with the good intentions of the co-CEOs, there will be within a year just one CEO tasked with managing and making sense of an ungainly and financially challenged organization.

The other big merger of note which will begin operating in earnest in 2019 involves CVS Health and Aetna.  This seems to be an unnatural combination, akin to breeding a goat with a skunk.

CVS Health is, of course, best known for its ubiquitous drug stores on every corner where there used to be a gas station.  They are very easy to find.  All you need to do is look for a Walgreen’s and sure enough there will be a CVS across the street.

CVS’ other business is acting as a pharmacy benefit manager which is where, I suppose, the synergies will come with the merger with Aetna whose health plans have been also-rans in most markets.  Still,, this combination really seems a reach and like a good way to lose a great deal of money.

There is no shortage of other health care related endeavors thrashing around in this new year.  It is telling that no one mentions a goal of improving patient care in any of these machinations.

Bottom line though is the bottom line.  All this activity is less about health care than it is about the money. What a waste.



Free The EMR

My 97-year-old father passed away last week after a four-day hospital stay  That is a  matter of private sorrow.  However, that experience renewed feelings I have about a particular aspect of modern health care and they are feelings of anger.

I want to make clear upfront that there were no medical errors involved with the care my father  received.  In fact, the care and attention provided by his physicians, nurses and others was exemplary to my critical but knowledgable eyes.  That included an environmental services aide who while cleaning my father’s room noted how sick he had become and took it upon himself to lobby successfully for a private room for my father.

His caregivers, though, were needlessly handicapped by lack of access to important information which might have changed their treatment plan.

My father was still living independently when he died.  He was hospitalized because some lab values alarmed his new cardiologist.  As I was to discover a day later, those values were normal for him and his recently retired primary care doctor had been monitoring them for years.  I discovered that fact by going to the patient portal used by the health care system to which his primary care physician belonged.

The cause of death was something that could have easily occurred at home, something we had become concerned enough about that we had scheduled a meeting of his children prior to the hospitalization to discuss living arrangement options for him.

The hospital was unique in that it had as attending medical staff its  own medical group as well as  medical groups affiliated with two other large health care systems.  The other health care systems did not have their own hospitals nearby and used the local hospital to care for their patients.

The problem was the electronic medical record (EMR) used by my father’s medical group was not accessible to the hospital’s staff.  At least two of the medical groups used the same vendor for their EMR but even then there was no sharing of information.  This lack of what the IT types call “interoperability” continues to be a flaw in the roll-out of EMRs.  It is dangerous and inexcusable.

An example:  early in my father’s hospitalization, a hospital pharmacist came to the room and asked what meds my father used at home.  I had access to his electronic medical record and showed her the list. Why could she not access that list?  The answer has to do with the siloing of medical records to the benefit of everyone but the patient.

Another example:  as I indicate above, I was able to determine by accessing my father’s medical record that his “normal” lab values were abnormal for most people.  The admitting doctor at the hospital had no way to see that valuable piece of information and the result was more testing.

When I was still a health care system CEO I used to go every other year to the headquarters of the EMR vendor we used.  On each visit I raised hell about this issue of information silos.  The last visit I made before I retired I raised enough of a ruckus that the President of the company joined us at lunch to discuss what his company was doing to make the information more easily accessible.  His promises sounded good but to my knowledge nothing has changed.

My father did not die because of this problem but I believe many people have.  There are task forces looking at the issue but they seem to move at a glacier pace.  There is plenty of resistance below the surface to the idea of interoperability.  The information collected from EMRs has value and it seems to me everyone is benefiting except the patient who is the rightful owner of the information.

Access to a patient’s medical information is crucial when that patient shows up at a hospital emergency service needing life-saving care.  Which medical group he uses and which EMR they use should not be a factor in allowing access to information which could be valuable in treatment.

It is not the EMR vendors’ information. It is not the insurance companies’ information.  It is not even the medical group’s or hospital’s information. It belongs to the patient and it is time it has been freed.  When does this revolution begin?

Free the EMR!


Big Blobs

A recent article in the San Francisco Chronicle by John Gerzema, co-CEO of the Harris Poll, caught my eye.  In it he refers to research that seems to indicate that larger organizations are less trusted and esteemed by the people they serve.  He put it this way:

“To sum up, the bigger you are, the less trusted you are, and companies that have the best reputations are small, or they have found a way to connect more personally—or  ‘act small.'”

He was referring to private enterprises and not health care organizations per se. Nevertheless, I believe his observation has applicability to the health care scene.

There has been a great emphasis in health care in getting bigger.  All the pundits say it is a great idea and we know the pundits are never wrong.  Misinformed sometimes but never wrong as they are consultants and wise people.

Actually I think they are both misinformed and wrong.

Here in California, we have mega-monster health care systems like Kaiser, Sutter and Dignity.  In bowing to the god (or goddess–take your pick) of bigness, they homogenize and centralize and in the process lose differentiation.  They become big blobs.

I became familiar during my years at NorthBay Healthcare with many locally based health care systems.  They fly under the pundits’ radar but they have much more local presence than the mega-monsters. They have to do well locally if they are going to do good at all.

They sponsor Little League and Bobby Sox teams.  They participate in “Fun Runs” and local fund rasing events.  They sponsor public schools serving children of less economically advantaged parents.  Their employees proudly wear their logos and colors. They do all of this without having to check in with Oakland or Sacramento or San Francisco or whereever the lords of the mega-monsters live.

They don’t have pension funding problems.  Unlike the mega-monsters which sometime seem to be wildly merging two financially challenged health care systems in the hope that magically the deficits will disappear, the small guys are financially stable and much quicker to react when financial problems do occur.

Perhaps even more importantly, the smaller guys tailor their services for the needs of their local community rather than the needs of a spoke and hub health care system.  The spread of technology is making providing locally based advanced services easier.  All those specialists being trained by the academic medical centers do need some place to land.

When you are rooted in a community, you make different decisions in a different way.  You have no place to hide and no one in a far away place to blame if things go awry.

The mega-monster health care systems have a lot to learn from the small guys. Small is the new big—-and trusted.

Will Santa Deliver?

IMG_0033Santa Claus made a lot of promises last month in the election.  During the run up to voting, he could be often found on the beach telling the beachgoers all sorts of good things would come if he was elected.  It was difficult to see if he was a Democrat or a Republican.  Nevertheless, Santa is my age and then some and if you cannot believe Santa who can you believe?

When you look down the beach where I spend my time you noticed three distinct sections.  There is the relatively small section occupied by what I call the healthy and wealthy.  They seem to be having a good time. Hard work and good luck pays off.

The larger middle section of the beach is occupied by people just kind of  making it through their beach experience.  They do worry much more than the healthy and wealthy but as long as they do not suffer a major health problem or their company is unable to keep their pension checks coming or the stock market crashes, they are fine. Comes the day they need assistance with activities of living, they may have a problem.

The final section of the beach is around the bend and not easily visible from the rest of the beach.  Here the beach is rocky and not particularly enticing.  The folks here are in a precarious state, often with chronic health problems and dependent primarily on social security.  It seems the number of people on this section of the beach is growing larger every day.  This group gets lost in the shuffle.  Out of sight, out of mind.

All the attention paid to health care in last month’s political campaigning seemed to have been forgotten at least until the decision by a federal judge in Texas last week declaring Obamacare unconstitutional  .You get the impression that particular tide will not come in again until 2020 when it can be again exploited by the Santas in both parties.  In the meantime, expect more posturing by politicians of all ilks.

The folks on the beach and elsewhere will be disappointed but they should not be surprised. I remember in 2010, right after Obamacare was passed with no Republican votes, a Democratic congressman telling me that what he called “corrective changes” would be made to some obvious flaws. Never happened and one result was last week’s controversial judicial decision.

We are seeing in California that our new governor is backtracking on grandiose promises he made concerning health care. Just too expensive to do now.  He knew that before the elections but promises are cheap unlike reality.

Instead, now there is a pivot to education, specifically making pre-school free and available in public schools.  Most pre-schools are now private.  Students who go from there to kindergarten have a leg up on their classmates whose parents could not afford to pay for pre-school.  That does not seem right.

If I were Santa I would also give priority to education.  The needs of kids should take priority over those of us on the beach.  We have had our time in the sun. That is easy to say given my spot on the beach.

Still, I wish there was a way to bring those beachgoers around the bend back to the main beach.  I wish I had spent more time before I hit the beach thinking about ways my health system could have done well by doing good for others on the beach.

There is a great opportunity on the beach for organizations, private and public, to be creative in meeting the health care needs of this burgeoning sector. Can we help Santa deliver on his promises?

In the meantime ho, ho, ho and whether you are on the beach or still trying to get there, the best to you in 2019.

Doing Good Differently

Even though I am now on the beach, I think about things as if I still am CEO of a health system.  It is easy to do that when you don’t have all the day-to-day responsibilities of an actual CEO.

Where do you take an organization which has developed a nice array of both inpatient and outpatient services and has been able to integrate a health plan into the mix?

There are many directions a healthcare  organization can go to fill unmet needs.  At this point in my life I see many opportunities to offer services to aging baby boomers and members of even older generations.  I have seen the need in my own family with older relatives.

Here is a brief look at some ideas worthy of exploration as health systems look to expand their services for the fast growing older sector of the population:

Medical Fitness Centers:  These are fitness centers open to all ages and fitness levels with a twist. There is a more medical orientation with highly trained staff helping to develop fitness regimes which take into account the special needs of members with chronic conditions.

NorthBay Healthcare opened a 55,000 square foot medical fitness center in 2016.  It’s where I spend the first part of every beach day.  Whether you are fit already, want to get fit or need to maintain your fitness level post-rehabilitation from an illness, medical fitness centers are a natural fit for those who look to a particular health care system for care. Medical fitness centers also help to build your brand and provide “stickiness” with existing patients.

Glenner Town Square:  Some years ago I was in Amsterdam and heard about a memory care residential facility which recreated a small Dutch town in the 1950s.  Using what was called “reminiscence therapy”, this facility had a positive effect on dementia patients who live there. A stroll down memory lane makes a difference.

This concept was adapted in the United States by the George G. Glenner Alzheimer’s Family Centers ( The primary difference is that these centers provide day care rather than residential care and the “Glenner Town Squares” are 9000 square foot replicas of 1960s America contained within an existing building.

Continuing Care Communities:  This is for those organizations which think big and have the resources to back up their big thinking!  Continuing care communities (CCC) are not a new concept.  Demographics are making the need for such communities grow.  I have a friend who is in her early 80s and has just recently moved from her large home into a CCC.

CCCs come in a variety of configurations and can be for-profit or non-profit in organizational structure.  CCCs which offer independent living, assisted living and memory care to my mind are the most comprehensive and attractive.  I tend to think of them as Club Meds for the older set.

You don’t see very often local healthcare systems offering CCCs as part of their care continuum.  That’s a shame because they are a natural fit.

There are other possibilities as well along the continuum of care. What you do depends upon the definition of healthcare which your organization has adopted. If your mission is some variation of ” fix the sick”(and there is nothing wrong with that), then staying on the acute care part of the continuum is where your organization may be best suited.

If your organization wants to help people be healthy, then there is a broader palette of healthcare possibilities available. With longer lifespans, I think most healthcare organizations need to expand their care continuum to take advantage of other possibilities.

It is very sexy currently in health care to look for the “disrupters” in healthcare–often a nerd who thinks using an iPad in patient care is the height of innovation.  Down at the actual service level, there are great unmet needs which could be met and in the process bind people to a healthcare system in a positive and long-lasting way.

I am a baby boomer and there are still millions of us yet to hit the beach.  We are all going to need  more options on the beach.  If those of us who are in health care are truly committed to the idea of care continuity, there exists great opportunity for health care organizations to do well by doing good in meeting these needs.

The Bobble Head Quest

Last Saturday was the “Big Game” at Memorial Stadium in Berkeley.  Cal’s annual game against Stanford had been delayed for two weeks due to poor air quality resulting from the devastating fire in Butte County to the north.

I am a long time holder of six season tickets for which I pay through the nose.  In addition to the outrageous price for each ticket, I have to make a “donation” annually so I can maintain my specific seat locations.  Each game represents an expenditure of about nine hundred dollars not counting the price of luke warm hot dogs.  With seven home games this year I spent over five thousand dollars which was more than I spent in tuition for my undergraduate degree at Cal.

This year’s Big Game had an additional attraction.  Cal was giving away a bobble head to commemorate “The Play” of 1982 when Cal won the Big Game in a lateral crazy last play kick off return.  The first ten thousand attendees would receive a bobble head and since I was present in 1982 I especially wanted one.  That is ridiculous at my age but I still reserve the right to be occasionally ridiculous.

My oldest son and I showed up at the stadium an hour early so we could be sure to claim our bobble heads.  We always enter through Gate 3 which has a special entrance for season ticket holders.  It is a way to avoid the crowds although most games are not that well attended.  Gate 3 is also the entrance for high school students being recruited for various Cal sports including football.

We had our tickets scanned and seeing boxes full of bobble heads asked for two.  We were told those bobble heads were reserved for recruits only.  You would think for five thousand dollars it would be easy to get the bobble heads.  No dice.  I was told that I might be able to get bobble heads at “Customer Service” on the plaza level.

No stadium staff members on the plaza level knew where “Customer Service” was. Getting increasingly frustrated in my quest for a bobble head, I headed to the main entrance at the North end of the stadium.  Nirvana!  There were thousand of bobble heads waiting for a home.

I went up to the ticket taker and another staff member who appeared to be a supervisor, explained what had happened at Gate 3 and asked for a bobble head for me and my son.

No dice again!  It was explained to me that the policy was that you could not be given a bobble head once your ticket had been scanned and you had crossed the ticket line.  My protests were met with no sympathy.  My ridiculous quest for a bobble head appeared to be at an end.

Then I got an idea.  I had three unused tickets for the game in my pocket.  Could I go two feet outside the stadium and have my unused tickets scanned as if I was entering for the first time?  Would that get me a bobble head?  There was a brief conference between the ticket taker and the supervisor and they gave approval for this brilliant move on my part.  I had my bobble heads and it only took me thirty minutes of effort.  That’s customer service!

Actually it was poor customer service. Cal’s football stadium is directly across the street from the Haas School of Business where I earned my bachelor’s degree.  Maybe there is an expert in customer service over there who should be consulted.

This would be funny if such unthinking responses only occurred at college sporting events.  Unfortunately, it also happens more often in healthcare than it should.

Even though I am now on the beach, I frequently get approached by people asking my opinion about an experience they had in accessing healthcare.  These inquiries are not about  “quality” as defined by the experts.  The typical patient is not concerned about hospital infection rates. As they should, they don’t expect to get a hospital acquired infection.

What they expect is responsive and caring service.  Here is a recent example of the opposite of that.

A man was sitting in a crowded medical clinic waiting room holding in his lap his child who looked between one and two years old.  Suddenly the child vomited on himself and the chair his father was occupying.  The registration clerks apparently did not notice (a charitable interpretation) or chose to ignore the situation.  Instead, two women also waiting to be seen went into action.

This may not be politically correct to say but I bet both women were mothers.  One went to a nearby restroom and emerged with wet paper towels.  The other went to her car and bought back baby wipes and a clean receiving blanket.  Together, they helped the father clean his toddler as well as the chair.  There was no staff assistance.

I have been mulling over this incident and my bobble head quest as I have been making my pre-Christmas shopping rounds.  Some businesses stand out in terms of the great quality of their service.

Amazon delivers (in more ways than one) a great on-line experience.  Chick-fil-A seems to have mastered the care and feeding of harried fast food customers.  Even often maligned Comcast has provided me great service recently.   Some organizations just  seem to get it.

For healthcare providers, the subject of quality is an ever continuing debate.  There is no shortage of measures promulgated by public and private organizations.  There is no consistency of measures.  It is very possible to be highly rated for quality  by one organization and have a low rating for the same area of healthcare by another organization.  I have seen that first hand.

None of that matters if you fail the patient at the entry point of care.  Most healthcare organizations I am aware of work hard at customer service but still fall short.  Why can’t healthcare providers deliver consistently good patient experiences at all points of contact.? Those that do will be the winners in our changing healthcare system.

By the way, to make my Big Game experience complete, Cal lost to Stanford for the ninth straight year.

A Big Boo-Boo

I have time on the beach to read the Wall Street Journal much more throughly than I did when I was not on the beach.  Given the recent volatility in the market, reading the Journal is more of a thrill ride than I like. Nevertheless, I have  been following in the Journal a recent development involving “disruption” in health care with interest

For the past year CVS and Aetna have been in the process of merging.  They recently received the approval of the Justice Department to proceed.  We will be disrupted–or will we?

In a late breaking development also in the Journal, Walgreen’s has just announced that it and Humana are exploring buying stakes in each other.

Why are drug store companies and health insurance companies looking to merge? Are these mergers an unholy alliance of dogs and cats?  Who is the disruptor and who is the disruptee?

CVS and Walgreen’s are being disrupted by trends in the retail market.  I seldom venture into a CVS store which I find typically looks like a bomb exploded inside.  Shelves are in disorder and help is hard to find.  When I do go inside, the stores look more like a grocery store than a drug store.  That is true of Walgreen’s as well.  They have an identity crisis.

I am a good example of why they are in trouble with their core retail business.  I get my electric toothbrush replacement through and my shaving supplies through These are subscription services providing me with high quality products at a  lower cost.  I get my vitamins and other supplements from Amazon. When I need to get a prescription filled and over-the-counter medications I do it while shopping at my local supermarket.  Who needs a drug store?

These trends have driven both CVS and Walgreen’s to go into the pharmacy benefit management business.  They have done so with some success.  However, it now appears that Amazon is looking hungrily at that business as well.  Where Amazon goes other businesses die.

CVS has also tried with limited success to provide health care directly through clinics in some of their stores.  I visited one such clinic in Washington D.C. and was not impressed.  It was located next to the pharmacy and I had to pass an impressive number of shelves filled with candy.  It was something less than a true urgent care clinic.  Staffed with nurse practitioners and physicians assistants with a do it yourself registration process using tablets (how cool is that) it offered a limited menu of services.  It was what I call a “boo-boo clinic”.  If you have a boo-boo go to CVS and be cool.  Anything  more than a boo-boo go to a real urgent care center or a hospital emergency service.

Similarly, Walgreen’s has some stores offering limited boo-boo clinics.  Some of the locations involve ventures with local health systems.

Walgreen’s is most famous for the venture it had in Arizona with the now discredited lab test business called Theranos. Theranos claimed it had a way to do lab tests which would disrupt the business.  It was a fraud and its founder, a young Stanford drop-out, goes on trial next year in federal court.  It was cool while it lasted but thousands of people were potentially victimized by inaccurate test results.

Now both CVS and Walgreen’s are going to get in the insurance business with health insurance companies which have had difficulty in gaining market share against the competition. Neither Aetna nor Humana have set the world on fire.   CVS and Walgreen’s claim the health plans’ synergy with their other businesses will make them more viable players in health care.

We have seen this story before.  In the 70s Sears owned Allstate Insurance and Dean Witter, a stock brokerage firm.  A section of most Sears stores had offices selling Allstate insurance policies and stocks through Dean Witter.  You could buy underwear, home and auto insurance and a mutual fund in the same place. That was considered cool then.

Today Sear has filed for bankruptcy, Dean Witter has disappeared and only Allstate which was spun off as an independent entity remains a successful business.

Are CVS and Walgreen’s on the right path?  Is there synergy in what they hope to accomplish with Aetna and Humana?    I don’t think so.

Retail drug stores and health plans are not health care.  They are, at best, small players in the real endeavor of health care.  Businesses in survival mode are not a good example of synergy.

The much more disruptive process which is occurring in multiple locations nationally is when hospitals, physicians and insurance companies either have joint ownership or operating agreements which require a sharing of risks of all kinds.  That is real synergy.

When you combine losers you don’t get much. What you get is a business without clarity of purpose.  You just get a bigger loser and a bigger boo-boo.