news and information

Community Value Systems Create a Working Focus on Results

by Michael Rohwer

In this article, the sixth in the series on reducing healthcare cost while improving quality, Dr. Michael Rohwer explains the role of the Community Value System (CVS) in fulfilling the purpose of healthcare.

Perhaps a brief summary of some key points from past articles would be a good way to begin. Here goes. The second article in this series, How Complexity Complicates the Healthcare System, explained how a process of nature called Complexity interferes with old-style traditional management leading to high cost and lower quality. Other industries have benefited from Complexity using a different management philosophy explained in Stepping Back from the Brink: Time to Rethink Healthcare Reform. This leads to the necessity of bottom-up management explained in the fourth article, Healthcare and Purpose-Driven Management. A focus on maximizing value delivered to every member is required, and in so doing, we are able to manage based on Actionable Metrics instead of Vanity Metrics. This is management at the community level and requires an innovation to facilitate the process. That innovation is called a Community Value System (CVS) and was introduced in Communities are the New Centers of Innovation and Learning. Because CVS is a critical component of healthy healthcare, I want to provide additional information regarding its role and the value it brings to local communities and to the healthcare system through networking.

The problem of top-down standards and expertise

What confounds traditional management of healthcare is neither a lack of expertise nor the ability to create standards. Rather it is the nature of expertise itself. Science is about creating a body of reproducible facts from a usually incomplete set of observations. The evidence must be interpreted, and experts—even the most ethical—cannot avoid some bias. As a result, the best information will have a narrow scope of reliability and even that must change in response to new information or better understanding. This is a good system in that it accurately reflects the state of knowledge; putting this knowledge to work in the real world where no neat boundaries of reliability exist is where things go astray.

Traditional management follows the machine metaphor. Standards, especially those considered evidence-based, become “Truth” and demand adherence. The real world of care delivery is quite different. While the nature of expertise is narrow and tentative, the people we serve have a range of simultaneous problems, all of which interact in different ways with multiple aspects of their environment. In addition, practitioner interactions have their own simultaneous and multi-dimensional dynamic. The correct application of narrow, well-founded principles and standards are rarely as easy as imagined from outside the examination room.

At the same time, the emergent properties and behavior coming from natural Complexity slow and distort information as it flows through the system. Old ideas can become entrenched and resist change. As a result, experience at the point of care is suppressed when it doesn’t square with what everyone “knows” to be true.

The root of our problem is that we are applying industrial-age thinking to an information-age problem.

The role of the Community Value System (CVS)

CVS enables communities to solve problems and maximize the value delivered to members. It is guided by national standards, but implemented in a way that fits each community. We should expect it to find nationals standards that don’t work and inform national organizations of better ways to get the job done.

CVS creates context and clarity through problem orientation in the same way the problem-oriented medical record helps clarify a clinician’s thinking. The CVS concept of a problem is very broad and spans social services through intensive care. It relies on narrative descriptions using clinical language that is directly useful to those who deliver care. For example, “Type II Diabetes complicated by polyneuropathy and proliferative retinopathy” tells a clinician nature and severity. Every physician will instantly know the range of things to consider for examination, diagnosis, and treatment. Now consider how much slower the ICD9 sequence is (250.91, 357.2, and 362.02). The more we are asked to think in coding systems at the point of care, the worse we can expect care to become.

CVS problems are managed with local programs. These programs use tools that borrow successful software engineering concepts called Agile. Each program has a goal, specified in terms of Actionable Metrics. Learning is a key output using Build-Measure-Learn loops borrowed from lean startup methods. Each begins with a minimum implementation and grows incrementally, based on experience and success. Every program uses a reimbursement system that rewards all providers who achieve the goal in member’s care. Reimbursement and goals are collaboratively negotiated at the community level.

CVS programs incrementally multiply to include multiple problems and related complications such that all members receive optimal high-value care that is reimbursed appropriately.

CVS creates transparency around performance. Everyone has an interest in understanding performance, yet it is missing from most of what we do. Transparency serves the needs of practitioners, the majority of whom believe that their highest value is the care they deliver to members. Referring providers need it to make good referrals. Healthcare organizations are hampered by Complexity, and transparency will improve our ability to manage the system. Every patient is a mix of problems and every practitioner has a set of interests and qualities in which they excel. The happiness of both depend on finding the best match.

CVS is the source of feedback loops needed to manage the system. Complex Adaptive Systems are grown using information and controlled by constraints such as feedback loops. This is described in more detail in Healthcare and Purpose-Driven Management. Performance information, coupled to value-driven payment implemented within each CVS program, is both the resource and the point whereby the system is managed. The influence of Complexity is mitigated at the level of community at the same time the relevance of information necessary to grow change is maximized.

CVS doesn’t have to be perfect to begin. It is a learning system. Everything we think we know is in some way wrong. Systems that work at the source of what the system is about and can support agility and learning will empower us to manage where traditional systems fail.

In this article, I’ve examined the central role of the Community Value System in building a new high-performance, member-centered network. My intention has been to focus on the problem and not the technology, since CVS technical detail is available from other sources.

In the next article, I will discuss how these changes may affect existing healthcare organizations.