Healthcare Reform

by Eric Nielson, UMN Law Student, MJLST Staff

This entry discusses some of the challenges identified in Grout et al.’s article Mistake-Proofing Medicine: Legal Considerations and Healthcare Quality Implications from Volume 14.1 of the Minnesota Journal of Law, Science, and Technology. If you don’t have any health problems, have family with health problems, or pay taxes then the problem probably doesn’t impact you. The rest of this paragraph is about me establishing my credentials on the subject, if you don’t care, feel free to skip ahead. I have worked as an R&D engineer developing medical devices for more than 15 years. I have a Masters in Medical Engineering from the University of Washington. I am an inventor on several medical device patents. I have worked for a very large company and for several startups. I have conducted market research, physician training, product design, FDA filing preparation, process development, product development, and implementation, etc. I have worked at nearly every stage of medical device development. Devices I have worked on are in literally millions of people in the United States.

The medical delivery system in the United States is fundamentally unchanged in its approach to quality management since the sixties, with the notable exception of anesthesiology (consider how, malpractice pressure forced reform of anesthesiology in the 80s). The public sector of our economy had to make major revisions when foreign competition in the eighties meant that domestic manufacturing could not compete with other countries. American automotive manufacturers took it in the chops because they could not effectively compete with Japanese and Korean companies. Only in the last decade have the automotive manufactures achieved economic efficiencies similar to their competitors (and finally shed some of their legacy costs). Hospitals and private practices never had this wave of foreign competition and so have never had to reinvent themselves to stay in business. Hospitals are heavily subsidized both directly by the taxpayer and through the federal system. The result has been local monopolies with limited real competition, just like the big three automakers before the Japanese entered the picture.

Japan did not invent quality manufacturing. Japanese industry was known for cheap, poor quality goods well into the sixties. What changed is that Japan got serious about producing quality products as a way to compete internationally and move up the value chain. To do this they relied on the work of several notable Americans: Demming, Juran (University of Minnesota graduate), and Crosby. These three together with Taguchi constitute the key founders of the discipline of Quality Management. There are some key concepts that I want to explore in relation to medical providers.

1) “Quality is free.” It is inherently cheaper to do it right the first time than to have to fix it. It is cheaper to spend more on the process to make it so reliable that you don’t have to continue to monitor the output. Your current business is probably externalizing the costs or hiding them and thus minimizes the real cost of defects in the products you make. Time and money are spent to prevent customers from knowing what the actual quality of health care provided by hospitals.

2) Nobody understands the problem better than all of us together. To find the best solution, you need to understand the system from the point of view of everyone who interacts with it. This requires that line personal have the ability to discuss problems and solutions without fear of negative job impact. This does not exist in modern hospitals. Nurses and staff doing the work are not free to identify problems or concerns with physicians. Decisions are not made with consensus but are top down, command and control by people with very limited information. This prevents identification of effective, realistic solutions and instead encourages ineffective window dressing committees.

3) Quality improvement depends on good information and systematic effort. Bluntly Medical providers have systematically hidden outcomes information in an effort to prevent the consuming public from being aware of how bad a job they’ve done. This includes not gathering the information, not publishing information they have, and playing malpractice claims to keep quiet. Take a typical medical procedure and go find the published complication rate. Then take those numbers and talk with specialists in that field about those numbers. What you’ll find is that the published data invariably understates the prevalence of complications at top flight institutions. This is generally a result of selection bias, where only data sets with exceptional outcomes are submitted for publication (so as not to reflect poorly upon the institution). In the absence of good information, these Potemkin village studies underestimate the scope and cost of the problem and encourage administrators and staff to ignore the problem. Nobody ever says Institution X published a study with only a 3% complication rate for procedure Y, we need to get our numbers to that level. They instead say, I wonder what their real rate is or I wonder how they selected their patients for that study.

4) Management needs to lead or it will not happen. This is a system problem. This is not a problem of people not doing their jobs. It is not about people not trying to do their best. The highly complex medical delivery system does not hold anyone responsible for the error rate. It doesn’t not impact salaries, reputation, or stock price the way it does at private companies. Look at the response from hospitals that are killing people every day compared with Toyota’s response to the “sudden acceleration” fiasco. Is the executive team involved? Are resources focused on the problem? Etc. FDA holds management personally, legally responsible for failures of the quality systems at medical device companies. The same standard hasn’t been applied to medical delivery systems. Maybe it’s time to apply this principle outside of Anesthesiology.