Workbook 2
The Challenges of System Governance
Today, slightly more than 50 percent of the nation’s hospitals identify themselves as being part of a health care system. Systems come in all shapes and sizes. Some are large and comprise many hospitals across a wide region, including, among others, nursing homes, physician groups and insurance companies. Others comprise several hospitals, as well as other entities, in close geographic proximity. And still others consist of a single hospital paired with only one other type of health care organization.
Whatever their size and scope, governing a system is different from governing a freestanding hospital because systems must often accomplish several different purposes through several different organizations, all operating within the context of a rapidly changing health care and regulatory environment.
In the 1990s, when system formation and integration were on the rise, those studying these emerging organizations defined and characterized systems in ways that provide insight into the issues and challenges of managing and governing them. Stephen Shortell, Robin Gillies and others formally defined an organized delivery system as a network of organizations that provides, or arranges to provide, a coordinated continuum of services to a defined population and is willing to be held clinically and fiscally accountable for the outcomes and the health status of the population served. The article, “Creating Organized Delivery Systems: The Barriers and Facilitators,” appeared in 1993 in Hospitals & Health Services Administration.
In The Future of Health Care Governance (1996), we described an integrated delivery system as having the following characteristics:
- Integrates care delivery and financing
- Integrates physicians with the organization
- Provides an accessible continuum of care
- Assumes accountability for the health status of specific populations in defined geographic areas
- Provides high-quality, cost-effective care resulting from the integration of services and clinicians
- Has a unified cost and quality information system
- Integrates physicians at all levels of leadership structures and planning activities
- s led by a new form of integrated, systems-oriented governance.
While some of the characteristics of systems have changed over the past ten years, their governance has focused on gaining a better understanding of what this “new form of integrated, systems-oriented governance” ought to be and how to ensure that it adds value. For systems to truly achieve their potential to provide better health care and services than any of their component organizations could provide alone, system governing boards must also rise to this same challenge.
System boards must lead their organizations toward mutually achieving system goals and, at the same time, lead by example to ensure that governance delivers more than just the sum of its parts. In other words, boards that govern together can achieve more than any one of them could achieve on its own.
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This article 1st appeared in the December 2099 issue of Trustee Magazine.
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