Preface

After a century of striving, after a year of debate, after a historic vote, health care reform is no longer an unmet promise. It is the law of the land. (President Barack Obama, March 23, 2010)

It may be a law, but is it a reality? Depending on who measures it, health care in the United States consumes around 18 percent of the gross domestic product of the nation. Few who pay attention to this statistic would regard that expenditure as sustainable. Not surprisingly, the growing cost of health care in the United States has stimulated many efforts at reform. However, success at these efforts has been at best mixed. Passage of the Affordable Care Act of 2010 and subsequent success of the legislation in the courts have raised the stakes and promise a new era of health reform. Yet the act of reforming health organizations has long been underway, and the lessons we have learned along the way can help inform and structure the organization and execution of reform efforts yet to come.

Since the late 1980s, health systems and health organizations have undergone dramatic changes in organizational structure, systems, and processes. These changes have included development of large, integrated health organizations, designed to provide scale and scope advantages, improve the quality of care and health outcomes, and provide greater bargaining power relative to payers and large employers. One result of this effort has been consolidation of health systems and physician-health organizations, and dramatic changes in relationships and practices between hospitals and physicians in an effort to improve financial and clinical outcomes. The scope and nature of this transition has created greater complexity and size in consolidated health systems, leading to greater interest in understanding hospitals and health systems as complex systems.

Health care is a “target rich” environment for students and researchers of organizational and system change. The changes underway at the organization and system levels are invariably complex, often confusing, and at times even chaotic. Over the last 20 years, researchers of health systems and organizations have devoted considerable effort to understanding the processes and outcomes of these organizational and system changes. Well established organizational theories have been applied by researchers and health care executives to help understand, design, and navigate health care reform, and often these approaches have been found wanting. The evolution and revolution of health systems and organizations is still very much a work in progress.

In Volume 15 of Advances in Health Care Management, we revisit two influential themes that have emerged from this effort:

• Viewing health care organizations as complex systems, leading to new perspectives on design and management of these organizations.

• Creation and organization of physician-health organizations, and alignment of these organizations with hospital or system structure and governance.

To anchor the critical assessment of research around these two themes, we invited authors of the two most frequently cited articles in the 15 year history of Advances to revisit and extend their original work, and judge the relevance of their perspectives the to the systemic reform underway at the national level. In the first section of this volume, Reuben R. McDaniel, Jr. and colleagues Dean J. Driebe and Holly Lanham revisit the influence of complexity science on the design and management of health care organizations. They argue that “people in medicine want to be sure, but complexity raises doubts,” and that avoiding serious consideration of complexity in the design of reform efforts makes it less likely that these efforts will result in meaningful reform. In an industry increasingly focused on outcomes, McDaniel, Jr. and colleagues argue that quick fixes and simplistic thinking may cause more harm than good given the complexity of health systems. As noted by Keller (1979, p. 718), whom they reference, “what is being evaded is the need for a cognitive structure radically different from the prior existing structure.” This is a provocative idea, and worth considering given the mixed results of most reform efforts thus far. In an invited commentary on this chapter, Ruth A. Anderson suggests mixing complexity theory with a focus on outcomes as means of achieving substantive reform.

In the second section of the volume, we revisit health systems integration, a theme that has attracted considerable interest among both researchers and system designers. For many years, health care leaders have struggled to engage physicians organizationally and operationally in structural changes and practice reform – reform designed to reduce costs and improve health outcomes. In the second anchor chapter in this volume, Lawton Robert Burns and his colleagues Jeff C. Goldsmith and Aditi Sen review two decades of evidence on horizontal and vertical integration of physicians, and provide a critical assessment of this widely used strategy. In the first comprehensive review of scale and scope economies of physician practice in nearly 20 years, Burns and his colleagues find little evidence that physician integration actually generates greater efficiency in care delivery. This is a major finding that calls into question core thinking about health reform efforts, and implies the need for much broader thinking about the best ways to organize for efficient delivery and effective outcomes. In the second invited commentary in this volume, Stephen M. Shortell, an eminent researcher on organizational and system change in health care, discusses conceptual and methodological implications of the research by Burns and colleagues for health reform, and moving from a “culture of care” to a “culture of health.”

Along with the two invited chapters and commentaries, we also solicited competitive chapter submissions for this volume around the themes of complex systems and health systems integration. In the first of these refereed chapters, Jenna M. Evans, G. Ross Baker, Whitney Berta, and Jan Barnsley explore the evolution of integrated health care strategies with an extensive analysis and integration of published literature on the subject over the last 25 years. They find six major shifts in integration strategies over this period, moving through horizontal and vertical integration, community-based health, quality of care, patient centered outcomes, and care for specific populations. They offer this as evidence of change and complex adaptation over time, and note a migration away from mechanistic models of health care delivery toward an emergent, self-organizing orientation. This chapter not only provides a wealth of source material for students and researchers on the topic, but also points to the emergence of new trends and conceptual models of system integration.

In the third section of this volume, authors of two refereed chapters focus more directly on hospital–physician relationships, a subject of considerable effort and research in recent years. Mona Al-Amin, Robert Weech-Moldonado, and Rohit Prahan borrow from literature on professional service firms to argue for a “new governance archetype” with potential to align incentives between physicians and hospitals. This non-equity partnership model offers an intriguing conceptual extension to more established approaches for aligning and integrating physicians in achieving efficiency and outcomes that meet hospital goals. Gregory W. Stevens also explores physician integration by considering professional relationships and collective identity of physicians and the role this plays in achieving physician engagement and coordination of care. Engagement, Stevens argues, is best achieved by “understanding a physician’s perception of his or her relationships to the profession and the organization.” He poses a series of propositions around the dynamics of physician identity that beg empirical further research.

Taken as a whole, this volume of Advances offers a detailed, critical look at the evolution of health systems organization through two lenses: HCOs as means of designing and managing complexity, and HCOs as mechanisms to align incentives and organization to achieve greater efficiency and superior outcomes, both for the system and for patients. In doing so, the chapters in this volume bring the latest evidence and thinking about these issues to the forefront of health care reform.

Jim Goes

Editor