Tuesday, March 08, 2011

Hospital Governance Issues in Israel

I am currently in Haifa, Israel, addressing a conference being held by the Israel National Institute for Health Policy Research entitled "Governing Hospitals." Here's the summary of the program:

As explained here, Israeli hospitals come in several varieties. An excerpt of the context:

Israel has a national health insurance system that provides for universal coverage. Every citizen or permanent resident of Israel is free to choose from among four competing, non- profit-making health plans. The health plans must provide their members with access to a benefits package that is specified within the NHI Law. The system is financed primarily through taxation linked to income (through a combination of earmarked taxes and general revenue). The Government distributes the NHI funds among the health plans according to a capitation formula which takes into account the number of members within each plan and their age mix.

The Ministry of Health has overall responsibility for the health of the population and the effective functioning of the health care system. In recent years the Ministry has developed strong capabilities in the areas of health technology assessment (HTA), the prioritization of new technologies, health plan regulation, quality monitoring for community-based care, and strategic planning to set goals for population health, along with strategies for achieving them.

In addition to its regulatory, planning and policy-making roles, the Ministry of Health also owns and operates about half of the nation’s acute care hospital beds. The largest health plan operates another third of the beds, and the remainder are operated by means of a mix of non-profit-making and profit- making organizations.

As you might expect, therefore, the questions of hospital governance in this country are complex and multivariate. It is impressive, therefore, that this conference was organized to provide the leaders of the hospitals with a chance to join together and consider future directions.

Speakers included Richard Saltman, from the Department of Health Policy and Management at Emory University, and Dr. Antonio Durán, from the Andalusian School of Public Health in Sevilla, Spain. You see them here with one of our hosts, Schlomo Mor-Yosef, Director General of the Hadassah Medical Organization. Nigel Edwards, from the UK's NHS, was supposed to attend but got busy with the issues mentioned above and sent a video of his remarks.

Professor Saltman summarized European efforts to restructure how public hospitals are governed. Starting with the introduction of self-governing trusts in England in 1991, policymakers in a number of countries have sought to design more independent decision-making capacity into public hospitals. The goal has been to generate more innovative and entrepreneurial behavior, while simultaneously preserving the social advantages that accompany publicly operated institutions.

Dr. Durán discussed the Spanish experience, noting that the country has explored various hospital self-governance arrangements over two decades. It has done so, however, via ad hoc, politically-driven, last-minute legislation, resulting in a confusing regulatory framework, with national and regional norms superseding each other. Various self-governing hospitals with different ownership status, legal characteristics, and degrees of autonomy and accountability now co-exist with traditionally managed public hospitals.

My talk was on the evolution of governance of US hospitals from a traditional focus mainly on financial management to an expanded view of a board's fiduciary responsibility, with a concern for issues of quality, safety, and efficacy of clinical care. My theme was that a well-functioning governing body can enable hospital leaders and management to harness the experience, wisdom, and judgment of members of the community to build a stronger hospital.

By the way, someone pointed out today that there is no Hebrew word for governance, making it an elusive concept here, perhaps culturally as well as linguistically. This suggests that some degree of flexibility will characterize the evolution of this concept in this country. But let's not be purists about this. After all, even in other parts of the world where governance is clearly part of the vernacular, it is not universally well executed. This conference suggests that we all can learn from one another.


Keith said...

I think you hit on the critical questions of what is the boards responsibility in respect to its governance. In the case of non profit hospitals, fiduciary responsibility should not be the main driver in board functioning and oversight. Nevertheless, hospital boards have seemingly evolved in this direction, increasingly populated by individuals of significant wealth and successful buisiness leaders also often having significant wealth. Their governance of hospitals has skewed more and more toward that of corporate for profit institutions rather than leaning toward the primary missions of the organization. Focus needs to be reshifted to community benefit and improvements in quality and cost containment instead of the usual definitions of successful corporate instituions who measure success as growth in income and profits. In this age when the health care system is placing considerable economic strain on our federal, state and local goverments, we need to also recognize that maybe cost containment and doing less may be something that needs to be rewarded. Not the perisitent increase in income and profit that marks success in other areas of economic endeavor.

Board governance needs to not mimic the for profit corporate boardroom either, with the titans of buisiness dominating the playing field. It should have more community leaders and representatives reflective of that community with involvement in the health care field; something I find consistently lacking in health care governance.

Anonymous said...

Hear, hear, Keith. I entirely agree with your ideas about composition and focus of the board. However, as with many issues in hospitals, the devil is in the details - of execution of those reponsibilities, in this case. In my admittedly limited experience with hospital boards, they often had little idea of how to fulfill their responsibilities. How, for instance, should they supervise the CEO? What are their qualifications for a truly independent evaluation of the hospital's quality and safety efforts? How do they navigate that perilous path between being too hands-off and too granular? How much power should the board chair have relative to the rest of the board or to the CEO - when a weak chair can hamstring the entire organization? Is the power structure within the board skewed, with the business/wealthy donor members mildly contemptuous of the community leaders, as was expressed by the 'stale bologna sandwiches' crack in Paul's post of 3/6/11?

Perhaps the Joint Commission, instead of teaching people how to pass its own inspections, should offer a free course to hospital boards on how to do their jobs in addition to making its Library of Best Practices free to all. After all, doesn't quality start at the top?

nonlocal MD

Robin Eichert said...

I served on a small community hospital Board and when I joined, I had very little knowledge about health care. I attended every conference I could (I heard Paul speak at one!), read a ton of material, networked with people to learn from them -- I became a sponge for information. It gave me a profound appreciation and understanding of how valuable having health care expertise is in effective governance. If you don't understand the issues, you can't make good decisions. And if you aren't knowledgeable, you can be misdirected to what decisions you should be making. However, I believe there is tremendous value in having non-health care professionals, too, as they bring a unique perspective, and can provide a sense of urgency to counter an understandable dynamic when "old-timers" become immune to issues and feel they can never be solved. The ideal scenario is to have some level of knowledge on the Board, along with others who ask the difficult questions and challenge the status quo. With whatever level of expertise exists, every Board member should clearly understand their role and be held accountable to it. Jim Conway at IHI offers a great program to educate trustees; I think there is nothing more important that trustees, administration, and staff all working together towards high quality and patient centered care.