Size Matters. The Work Environment Matters More.
You know the world has changed when MassGeneralBrigham announces a projected $250 million operating loss and plans to lay off hundreds of non-clinical staff over the next 2 years.
This announcement comes on the heels of losses from the previous year. According to a recent issue of Healthcare Finance News report:
"Over the past two years, MGB has reported financial losses. In the fiscal year 2024, which ended on September 30, 2024, excluding $118 million in revenue that pertained to prior year activity, the health system generated a loss from operations of $72 million, a -0.4% operating margin. In 2023, the loss from operations was $48 million, -0.3% operating margin, excluding $143 million prior year revenue."
I'll address some of the changes I think MGB should consider in a minute. But first, a brief description of this massive academic health system.
Created in 1994 through the merger of two Harvard-affiliated academic medical centers -- the former Massachusetts General Hospital founded in 1811 (the third oldest hospital in the US) and the former Brigham & Women's Hospital -- the combined entity was subsequently rebranded as MassGeneralBrigham in 2019. It today consists of some 82,000 staff, approximately 7500 of which are physicians; a collection of 12 hospitals, home care services, a network of specialty practices, urgent care facilities, outpatient clinics, surgical centers and a health insurance plan. MGB has a massive market footprint in eastern Massachusetts to go along with a worldwide reputation for pioneering clinical research and advances in clinical care. It also has an extraordinarily large endowment --$10 billion -- which produced some $2 billion in non-operating revenue in 2023.
To call MGB a large health system would be a gross understatement. Notice I didn't also apply the adjective "integrated".
Critics of the original merger claimed that bringing together these two heavyweight academic medical centers was an object lesson in price fixing. A more charitable characterization is that regulatory approval of the merger gave the combined entity an unusually large amount of leverage with payers in the aftermath of what had been heavy rate regulation. To many observers, post-merger, MGB remained essentially an accretion of highly territorial chess pieces, each of the principals to the merger retaining their own distinctive cultures, practices, and large overheads. In short, a system in name only.
Here's my point: in today's complex, fast-changing healthcare environment, an engaged, nimble, and aligned workforce is likely more important than having a huge endowment. Being able to adapt quickly and execute well is more important than the size and complexity of a system's footprint. Having a reputation as a great place to work -- reflected in sterling clinical staff recruitment and retention results -- is likely a more reliable predictor of positive operating results than a worldwide reputation for clinical research. Delegating day-to-day operating decisions (within parameters) to front-line teams is far more impactful and less costly than having many layers and levels of managers trying to create organizational cohesion and achieve system synergies.
MBG has the intellectual and financial resources to find a way out of its current morass. I submit that it will achieve better long-term results if it focuses on creating an outstanding work environment and true "systemness" rather than simply trying to cut its way to prosperity.
Solutions for Hospitals, Health Systems, and Medical Group Practices: Leadership-Driven Changes
The locus for curing clinician burnout and staffing challenges runs through the C-suite. Here are examples of leadership-driven changes to the workplace that my colleague Paul DeChant, MD, MBA and I often recommend:
> Regard clinicians as knowledge workers who are given significant latitude to make clinical decisions without unnecessary administrative encumbrances or delays
> Consistently apply one or more of the improvement sciences (Lean, Six Sigma, operations research, agile, design thinking) in consultation with front-line staff to improve workflow and reduce delays, waste, inefficiency, and job skill mismatches
> Expect all leaders, but especially senior executives, to do periodic job shadowing of front-line staff (where observing and deep listening are emphasized) in lieu of "rounding" (a largely ineffectual, if widely practiced activity)
> Create and require leader standard work (LSW).
> Develop and deploy a sophisticated, deeply ingrained, and rigorous daily management system (DMS) supported by visual display boards or monitors
> Judiciously invest in AI/ML solutions -- selected, tested, and endorsed by front-line staff -- that eliminate or at least markedly reduce data entry, administrative requirements, and/or repetitive tasks that are non-value add
> Support near-continuous optimization and remediation of the EHR (there's no such thing as "it's all set")
> Get rid of superfluous or outdated policies, procedures, redundant approvals, and other stupid stuff (GROSS)
Ready to transform your hospital or workplace?
Are you frustrated by mistrust or even adversarial relationships between front-line clinicians and senior leadership? Organizational Wellbeing Solutions was formed to enable senior leaders to identify the specific drivers of clinician burnout in their organization; and to support leaders in designing and executing a comprehensive plan to stop clinician burnout, increase retention, and improve operating results. A hallmark of our consultancy is correcting the all-too-frequent distrust and alienation Clinicians feel toward the C-Suite generally and the CEO in particular. Let us help you help your organization and its clinicians develop a more trusting, aligned, and productive working relationship.
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