Development of a local physician executive leadership program.

Sharp HealthCare, a community-based, not-for-profit organization with hospitals in the San Diego, Calif. area, has been involved in the development of a regional approach to health care resources and delivery in a managed care environment. It has recently undergone a significant restructuring, the desired result of which is greater physician input into the change process. It is within the context of this organizational change that our Physician Executive Leadership Program (PELP) entered its second year.

PELP was organized by Sharp HealthCare in collaboration with the University of California at Irvine (UCI) Graduate School of Management. The program, which consists of 11, 8-hour seminars, is presented once each month on a Friday evening and Saturday morning. The 60 participants include physicians who have demonstrated an interest in leadership and managing roles within the medical staff or hospital and administrators from the five hospitals and the corporate office. The faculty comprises professors of the UCI Graduate School of Management and other professionals with training and experience in organizations and the health care industry.

Each session begins with an informal discussion led by a Sharp HealthCare executive and includes an opportunity for questions and answers. Lectures and presentations by the faculty are combined with group exercises, case studies, and real-world problem-solving sessions. Interaction between presenter and audience is encouraged. The goal is to integrate theory and application; every attempt is made to relate general principles to specific example within the Sharp HealthCare organization. Each participant is asked to complete a evaluation of the content, quality, and relevance of the material to his or her practice and to Sharp HealthCare; the evaluation are trended and discussed at the following month's session.

The primary goal of the program is to help provide physicians with some of the skills and knowledge necessary to function as leaders in health care. The program content is divided into seven modules, each dealing with a critical area of health care management:

Module 1. Quality in organizational life in large part depends on relationships that, in turn, depend on mutual respect and understanding. The initial session on communication focuses on the skills required to facilitate understanding between individuals within organizations. Role playing is used to demonstrate effective communication skills. There is an opportunity to explore potential conflicts between physicians and other members of the health care team.

Module 2. The second module focuses on the history of our health care system. Economic and political influence resides in concentrated interests, such as government, the health insurance industry, employers, physician groups, and various consumer groups. One theory suggests that it is the interplay among these forces that has shaped the major legislation, such as Medicare and Medicaid, regarding the delivery of health care in this country. By identifying the changing balance between concentrated interests, one may be able to predict or at least understand future changes in health care.

Module 3. Strategic planning for an organization or for an individual physician practice involves recognizing and combining resources (human, technological, and other) to achieve the objectives of that organization or practice. As the environment becomes more competitive, health care providers, whether individuals or organizations, must differentiate themselves on issues of quality of care, level or scope of service, and price in order to develop and maintain market share. Patients are not the only "customers" of health care organizations. Employers and state and federal governments are major "external customers" of health care; physicians, nurses, and other providers are "internal customers" of the large health care organizations. Each customer, whether external or internal, has different goals and preferences. The goal of strategic planning is to identify each customer group and design a marketing plan to target that particular customer's preferences.

Module 4. The external environment within which the health care organization exists is changing; the survival of a particular organization or practice can no longer be ensured. An organization is most likely to operate effectively when there is consistency among its structure, its environment, and its organizational values. The fourth module comprises four sessions and deals with understanding the basics of organizational structure, the role of management, and what influences organizational behavior. Organizations whose structure allows for early identification and effective implementation of change will be the most likely to survive. Both the old and the new organizational structures of Sharp Healthcare are presented and the implications for the role of the physician within the organization are discussed in detail.

Module 5. The fifth module deals with financial management of the health care organization. Learning to read and understand an income statement, a balance sheet, and other financial reports enables the physician executive to assess the financial status of an organization. Benchmarks of the financial health of a health care organization are discussed. Capitation will likely predominate in the future. Fee-for-service medicine, which rewards providers who increase the volume of their services, will be replaced by at-risk contracts under which providers are encouraged to prevent the need for high-technology (and expensive) care. Financial issues under managed care have tremendous implications for the relationships among hospitals, physicians, and other providers. In sharing risks, physicians and hospitals will be interdependent and will need to cooperate to decrease the cost of providing the best care possible. There will be competition for a greater "share of the pie" within the health care organization. Physicians will be encouraged to further realize their leadership potentials to ensure that they have a voice in decisions that affect their financial future as well as the well-being of their patients.

Module 6. High-quality medical care may be easy to recognize, but it is difficult to measure. However, quality, which can be defined as the ability to meet or exceed customer expectation consistently, is likely to remain the most important attribute by which health care organizations will be judged. Maintaining quality while controlling costs will characterize successful health care organizations. The heightened emphasis on outcome studies, clinical pathways, and practice guidelines will help define quality of care. In an increasingly competitive environment, this will be a major factor influencing the behavior of health care organizations. Physicians will see the value of quality management programs in the outpatient and inpatient setting and must help to make these programs more meaningful.

Module 7. The final module looks at current health care systems and the applicability of these and other models in the United States. An attempt is made to synthesize from the preceding modules the expected outcomes of health care reform, particularly with respect to organizations and networks. Sharp HealthCare's perspective is discussed, and future roles for physicians and the implications for their medical practices in the new delivery system are explored.

In its second year, which began in January 1993, PELP became a forum for discussion of the dramatic challenges facing physicians and administrators today and in the future. San Diego has seen a steady increase in managed care and the erosion of traditional, fee-for-service medicine. In a health care system driven by the primary care physician, the role of the specialist is uncertain. However, with ever-increasing growth in technology and subspecialization, the appropriateness of the primary care physician to care for the hospitalize patient is in question. PELP has provide all participants with an opportunity to share their feelings and experiences and to speculate together on the future of health care in their communities and within a large health care organization. The program has provided them with a forum and the skills with which to communicate their concerns, acknowledge their growing interdependence, and critically analyze their professional environment. In addition, PELP has demonstrated by its very existence that even individual physician leaders are vitally important to the success of the health care organization. It is hoped that the skills and insights provided by this program, as well as the relationships that have developed between the various participants, will help prepare all those involved to deal with the difficult challenges ahead.