Fixing Healthcare: Commoditizing Expertise and Viewing the Whole

In an interview published in The New York Times this week, Clayton Christensen, a Harvard business professor and the author of several books on innovation, offers some interesting ideas about fixing healthcare in the U.S.  Some of those ideas reflect lean thinking.

            Christensen talks about the need to “commoditize the expertise of doctors,” meaning make it possible for less-costly diagnosis and treatment of illnesses. He notes that while diagnosis of some diseases is clear-cut, others are not well-diagnosed.

            As an example of what can be achieved, he points to Minnesota, where nurse practitioners are allowed to write prescriptions. The result is a growing number of clinics in drugstores, staffed by nurse practitioners. Christensen comments,


            “There’s a big sign on the door that says ‘we treat these 16 rules-based disorders.’ They include strep throat, pink eye, urinary tract infection, earaches and sinus infections.

            These are things for which very unambiguous, ‘go, no-go’ tests exist. You’re in and out in 15 minutes or it’s free, and it’s a $39 flat fee. These things are just booming because high-quality health care at that level is defined by convenience and accessibility. That’s a commoditization of the expertise. To have those same disorders treated in Massachusetts, you’ve got to go to a regular doctor, go through a long wait in their office, you go in and see the doctor for two minutes. He says, ‘You have an earache,’ which you knew already, and then they charge you $150.”


            Commoditizing expertise is one key issue here. That perhaps has some relationship to the lean concept of empowering floor-level workers and providing cross-training.

            However, what I believe is equally important in this example is the clear focus on the customer, which is fundamental to lean and which is too often lacking in healthcare processes.

            Christensen also discusses the structure of healthcare organizations today:


            “The current healthcare system is divided into buckets. You have the insurers, the employers who put up the money, the providers such as doctors and nurses, and the hospitals. Because they exist as independent companies, they can each improve themselves, but they can’t re-architect the system in the way that it needs to be changed.

            “There are two health care systems in the West, Intermountain Health Care in Utah and Kaiser Permanente in California, that are in fact integrated across each of those pieces of the system. They are far ahead of the rest of the world in bringing rules-based diagnosis and therapy in cost-effective business models to their patients.”


            The words may be different, but Christensen is clearly talking about looking at processes end-to-end and eliminating the silos that exist within both organizations and supply chains – and that is unquestionably a lean approach.

            Christensen is involved in research, and in efforts to educate high-level healthcare executives to about ways to achieve change.

            I don’t know how many years it will take to get to a tipping point, where we truly see significant change in healthcare. But people like Christensen can help us get there.


Ralph Bernstein said...

1/3/2007 6:05:55 PM
Re: Fixing Healthcare: Commoditizing Expertise and Viewing the Whole
by: dcbliss

As a member of the healthcare system, I see what Mr. Christensen is talking about every day. It's a tough nut to crack - our Lean efforts at my hospital will help us and our patients, but the bigger issue is the one he describes as the "buckets". And the one he didn't specifically name is Medicare, who sets the tone for how payments are done and what it takes to get reimbursed for a given procedure. We will keep working and looking for opportunities to "reach across boundaries" to help address the bigger issues, but he's right - we have a long way to go.

Ralph Bernstein said...

1/8/2007 4:28:14 PM
Re: Fixing Healthcare: Commoditizing Expertise and Viewing the Whole
By: eamonc

For anyone who wishes to know more on how Lean can be and has been applied successfully to a healthcare organisation, there is a new Lean Healthcare resources with some excellent articles at www.leanhealthcareservices.com/blog.html