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CHAPTER 3

Quality in Healthcare:
Concepts and Practice
Phil Buttell, Robert Hendler, and Jennifer Daley

I

n the healthcare industry, quality of care is more than a concept. It has become
essential to patient well-being and financial survival. This chapter will discuss the
complex concept and multiple definitions of quality of care and evaluate how it
has become an increasingly important factor in the delivery of healthcare. We will
start by providing a historical perspective to help readers understand the evolution of quality in the healthcare industry. This perspective will include landmark
reports and events that have helped shape the role quality of care currently plays in
the industry. We will then explore the key principles and definitions that are essential to healthcare quality. After reviewing the key principles, we will explore a case
study that illustrates the impact that quality improvement is having on a particular
company within the industry. Last, we will speculate on the role quality will play
as the healthcare industry continues to evolve.
The authors of this chapter are involved daily in the complexity of designing systems and motivating people to achieve the desired goal of high-quality,
highly safe, and efficient healthcare. We believe that this goal is important for
both human and business reasons. Imagine a hospital system in which proper
processes are delivered in a timely fashion for the many different types of patients
and disease processes. Imagine a hospital with no hospital-acquired infections,
no staff-related oversights leading to complications during difficult deliveries, no
wrong-site surgeries, and no medication errors. A system that demonstrates this
type of success has lowered the cost of providing care while maximizing the quality of care. We all want to be treated at such an institution. Employers would
demand that their patients use this system because they no longer wish to bear the
cost of poor outcomes, complications such as congestive heart failure following
inadequate or delayed reperfusion of a coronary vessel in an acute heart attack, or

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hospital-acquired infections. Clearly, hospitals and physicians that provide costeffective quality care will have made the business case for quality of care and be
rewarded with higher volumes of patients and better reimbursement.

QUALITY IN HEALTHCARE: WHAT IS IT?
To begin this discussion, we must have a shared definition of quality and understand the strengths, weaknesses, and misconceptions of commonly held concepts
about quality in healthcare. When a group of healthcare professionals is asked what
quality means, there may be as many definitions as people in the room. And differing definitions can and will lead to different priorities and different goals, depending
on the perspective of the constituent: patients, their families, healthcare providers
and professionals, regulators, insurers, and employers. W. Edward Deming, who
led the quality revolution in Japan and the United States, said, “A product or service
possesses quality if it helps somebody and enjoys a good and sustainable market.”1
Note that he does not define quality directly but references the value of a product or
service in terms of its ability to both help the consumer as well as its marketability.
Donabedian, a leading figure in the theory and management of quality of healthcare, has previously suggested that “several formulations are both possible and legitimate, depending on where we are located in the system of care and on what
the nature and extent of our responsibilities are.”2 Different perspectives on and
definitions of quality will logically call for different approaches to its measurement
and management.3 Another author recognizes the inherent problem in defining
quality by stating, “It would be difficult to find a realistic definition of quality that
did not have, implicit within the definition, a fundamental expression or implied
focus of building and sustaining relationships.”4 Understanding differing perspectives about quality does not prevent success in achieving quality of care as long as
key principles and concepts of quality are identified, understood, and used.
The most durable and widely cited definition of healthcare quality was formulated by the Institute of Medicine (IOM) in 1990. According to the IOM, quality
consists of the “degree to which health services for individuals and populations
increase the likelihood of desired health outcomes and are consistent with current
professional knowledge.”5 Other authors have recognized Deming’s appreciation
of the importance of the market. They refer to care that meets the expectations of
patients and other customers of healthcare services.6 Therefore, for the purposes
of this discussion, we have expanded the IOM definition. Quality consists of the
degree to which health services for individuals and populations increase the likelihood of desired health outcomes (quality principles), are consistent with current
professional knowledge (professional practitioner skill), and meet the expectations
of healthcare users (the marketplace).

THE EVOLUTION OF AWARENESS OF QUALITY IN
HEALTHCARE AMONG THE PUBLIC
The public has become more aware of the role quality of care plays in healthcare. The definition has not changed, but the public and the industry’s awareness

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certainly has. High-profile patient safety failures have had a profound impact on
the evolution of the public’s awareness of quality of care. Patient safety plays an
important role in quality performance, but it is important to note that quality
and safety are not the same thing. Patient safety is a subset of the larger, much
more complex and multidimensional concept of quality. Highly publicized patient care failures, however, were the catalysts that prompted a national evaluation
of the patient safety issues troubling healthcare.
On December 3, 1994, a 39-year-old cancer patient died of complications of an
overdose of cyclophosphamide, a chemotherapeutic agent she received at the DanaFarber Cancer Institute (DFCI) in Boston for treatment of widely metastatic breast
cancer. Another patient at DFCI also suffered an overdose of cyclophosphamide
and experienced serious heart damage. According to James B. Conway, DFCI’s
chief operating officer, and Dr. Saul Weingart, director of the Center for Patient
Safety at DFCI, “Both errors involved breakdowns in standard processes, and both
raised issues of trainee supervision, nursing competence, and order execution.”7
The media reported the event with 28 front-page headlines over the next three
years, partially because the patient who died, Betsy Lehman, was a healthcare reporter for the Boston Globe.
Although medical professionals have always known about deadly errors in complex healthcare systems, the public at large reacted to the events at Dana-Farber
with shock and disbelief. They want a safe environment for themselves and their
families, and these incidents were clear examples that hospitals are often unsafe,
even at highly respected institutions. Regardless of the magnitude of the errors or
the ability of the media to relay the message to a local community or an entire nation, these incidents and medical errors put quality and patient safety on the front
page of every newspaper in the United States. Numerous other high-profile and
fatal medical errors continue to be reported on an almost weekly basis, contributing to a general loss of trust among patients and their families when they experience serious illnesses.

THE INSTITUTE OF MEDICINE RESPONDS:
TO ERR IS HUMAN
In response to the incident at Dana-Farber and many other facilities, the IOM
began a thorough examination of patient safety, which resulted in the report To
Err Is Human: Building a Safer Health System.8 To Err Is Human brought patient
safety into the mainstream of healthcare in academic centers, community hospitals, physician and nursing professional meetings, as well as on the front page of
every newspaper in the United States. This report had a tremendous impact on the
safety of healthcare delivered in the United States. As we will later see, the impact
has not been as deep or as significant as one might have hoped, but the report
changed the way people think about healthcare and their fundamental perceptions
of the safety of healthcare delivery.
This report was the first in a series of reports produced by the Quality of
Health Care in America Project. “The Quality of Health Care in America project

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was initiated by the Institute of Medicine (IOM) in June 1998 with the charge
of developing a strategy that will result in a threshold improvement in quality over
the next ten years.”9 The authors of To Err Is Human suggested that anywhere
from 44,000 to 98,000 Americans die each year as a result of medical errors in
hospitals. This number was derived from two parallel studies, one of which was
conducted in Colorado and Utah hospitals and the other was a study based on
data from New York State hospitals. The numbers were staggering and equivalent to a 747 airliner full of patients crashing every day. The New York study
analysis suggested that serious adverse events occur in 3.7 percent of all hospitalizations.10 The New York study was replicated in Colorado and Utah and
found that serious adverse events occurred in 2.9 percent of hospitalizations.11
Although many healthcare professionals were aware of the potential for serious
safety problems in U.S. hospitals, few lay people realized the full magnitude of
the risk and the deadly outcomes of flawed hospital systems. Academics, lawyers, state and federal legislators, and healthcare professionals involved in the
complex workings in healthcare organizations were faced with the realization
that something was broken in a system in which the goal was to alleviate suffering and save lives.
The IOM report made the following (see table 3.1) recommendations based
on their review of patient safety:
1.
2.
3.
4.

Improve leadership and knowledge.
Identify and learn from errors.
Set performance standards and expectations for safety.
Implement safety systems in healthcare organizations.

These recommended actions are critically important to the development of a
safe healthcare environment. A continued focus on these objectives will help create a much more quality-driven industry and a much safer environment in which
to receive care.
The recommendations made by the IOM serve as useful starting points to
improve patient safety, and several changes have been made to address these recommendations. Not enough, however, has been accomplished to change the culture
of patient safety in the industry overall. Leadership is vital to improving the focus
as well as the performance in patient safety. Leaders help shape the agenda in our
industry by a single-minded focus on patient safety that is shared among all participants and constituents in the healthcare system. An increased focus on patient
safety in the industry will need to be supplemented with additional knowledge and
understanding of the specific elements that promote patient safety. This singleminded goal drives the evolution of policy and creates a culture that values the role
quality and patient safety play in the care of patients.
Identification of serious errors is also important when attempting to improve
patient safety through root cause analysis. In addition, so-called near misses—
patient safety system failures that do not result in injury to patients—also provide

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Table 3.1
To Err Is Human Recommendations
Improve Leadership and Knowledge
Recommendation 4.1: Congress should create a Center for Patient Safety within the Agency
for Healthcare Research and Quality. The Center for Patient Safety should:
•
•

Set the national goals for patient safety, track progress in meeting these goals, and issue an
annual report to the president and Congress on patient safety.
Develop knowledge and understanding of errors in healthcare by developing a research
agenda, funding Centers of Excellence, evaluating methods for identifying and preventing
errors, and funding dissemination and communication activities to improve patient safety.

Identify and Learn from Errors
Recommendation 5.1: A nationwide mandatory reporting system should be established that
provides for the collection of standardized information by state governments about adverse
events that result in death or serious harm. Reporting initially should be required of hospitals and eventually should be required of other institutional and ambulatory care delivery
settings.
Recommendation 5.2: The development of voluntary reporting efforts should be encouraged.
Recommendation 6.1: Congress should pass legislation to extend peer review protections
to data related to patient safety and quality improvement that are collected and analyzed by
healthcare organizations for internal use or shared with others solely for purposes of improving safety and quality.
Set Performance Standards and Expectations for safety
Recommendation 7.1: Performance standards and expectations for healthcare organizations
should focus greater attention on patient safety.
•
•

Regulators and accreditors should require healthcare organizations to implement meaningful patient safety programs with defined executive responsibility.
Public and private purchasers should provide incentives to healthcare organizations to demonstrate continuous improvement in patient safety.

Recommendation 7.2: Performance standards and expectations for health professionals should
focus greater attention on patient safety.
Recommendation 7.3: The Food and Drug Administration (FDA) should increase attention
to the safe use of drugs in both pre- and postmarketing processes through the following
actions:
•
•

•

Develop and enforce standards for the design of drug packaging and labeling that will maximize safety in use.
Require pharmaceutical companies to test (using FDA-approved methods) proposed drug
names to identify and remedy potential sound-alike and look-alike confusion with existing
drug names.
Work with physicians, pharmacists, consumers, and others to establish appropriate responses to problems identified through postmarketing surveillance, especially for concerns
that are perceived to require immediate response to protect the safety of patients.

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Table 3.1
To Err Is Human Recommendations (continued)
Implementing Safety Systems in Healthcare Organizations
Recommendation 8.1: Healthcare organizations and the professionals affiliated with them
should make continually improved patient safety a declared and serious aim by establishing
patient safety programs with defined executive responsibility. Patient safety programs should:
• Provide strong, clear, and visible attention to safety.
• Implement nonpunitive systems for reporting and analyzing errors within their organizations.
• Incorporate well-understood safety principles, such as standardizing and simplifying equipment, supplies, and processes.
• Establish interdisciplinary team training programs for providers that incorporate proved
methods of team training, such as simulation.
Recommendation 8.2: Healthcare organizations should implement proved medication safety
practices.

an opportunity to prevent errors. The industry has the ability to learn much from
errors and near misses, and those learning opportunities need to be identified and
capitalized on at the time of the safety system failure. Unfortunately, in our society,
it is difficult to create a blame-free environment without incurring legal liability
for negligence. Safety theory in other high-reliability industries such as commercial aviation and nuclear power strongly suggests that human error is typically related to system problems and human behavioral and cognitive patterns rather than
mistakes by individual providers because of lack of knowledge or carelessness. To
compound the naturally occurring problem of human error, healthcare providers
have a professional and humanitarian responsibility for human life in which doing
no harm is a basic ethical principle. Take, for example, an individual in an assembly line responsible for making stuffed animals. If this individual makes an error,
there are few complications that will result, except perhaps lower productivity and
an unhappy customer. In healthcare, mistakes can cause loss of life. Creating an
environment that embraces error as an opportunity for improvement rather than
an opportunity for blame and punishment is essential to promoting patient safety
and safer healthcare for both patients and healthcare workers. The authors of the
To Err Is Human report recognized the capacity for forgiveness and healing by
choosing the title of the IOM report from a common phrase, “To err is human;
to forgive, divine.”12
According to the IOM, setting performance standards and expectations is another essential element to improving patient safety. This is an area that has been
somewhat disorganized, as institutions were often responsible for setting their
own patient safety agenda resulting in great variation among facilities. Resources
were not always uniform, nor were they utilized in appropriate ways to set a
safety agenda. There is value to creating standards and expectations that are universal. Creating standards and universal areas of focus help provide legitimacy

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and a target area. The Joint Commission on the Accreditation of Healthcare
Organizations (JCAHO) has taken a leadership position in setting the patient
safety agenda by promulgating new patient safety goals every year around common patient safety problems in hospitals (e.g., wrong-site surgery, illegible and
nonstandard abbreviations, and preventions of falls among hospitalized and nursing
home patients).
The last area of focus the IOM recommended was the implementation of patient safety systems in healthcare organizations. Implementing reliable systems
that prevent human error in emergency rooms and intensive care units will improve
patient safety in the U.S. healthcare delivery system.

AFTER TO ERR IS HUMAN: WHAT HAVE WE LEARNED
AND WHAT HAVE WE DONE?
It is clear that the healthcare industry is not where it needs to be when perceived from a patient safety perspective. Medical errors continue to happen every
day, and people are still at risk whenever they enter the healthcare system for care.
The public is more aware of issues that have been played out in the media, and the
IOM report has improved the awareness of the problem, but still too little is being
done to transform healthcare. The patient safety agenda has been promoted by accrediting bodies, professional and hospital associations, and the myriad of public
and private institutions whose main goal is to improve patient safety and the quality of healthcare in the U.S. system.13 Five years after To Err Is Human, “the impact
on attitudes and organizations has been profound. . . . In sum, the groundwork for
improving safety has been laid these past 5 years but progress is frustratingly slow.
Building a culture of safety is proving to be an immense task and the barriers are
formidable.”14 Still, problems exist. “Little evidence exists from any source that
systematic improvements in safety are widely available.”15 Improvements are happening every day, but the changes are limited to small improvements at local and
individual levels. Some hospitals are achieving groundbreaking improvements in
patient safety, but these are the exception rather than the rule. The changes need
to be industry-wide for the value to really be seen by the public.

CROSSING THE QUALITY CHASM: A ROAD MAP FOR
IMPROVING QUALITY OF CARE
A second major report by the IOM’s Committee on the Quality of Health Care
in America—Crossing the Quality Chasm—followed To Err Is Human. This report
focused on the quality of care currently present in the U.S. healthcare system. The
first sentence of the report reads, “The American health care delivery system is in
need of fundamental change.”16 The committee outlined an agenda to improve
quality. Table 3.2 outlines this agenda.
This report expands the work outlined in To Err Is Human in regard to improving patient safety because it focuses on a redesign of the entire industry around

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Table 3.2
Crossing the Quality Chasm Agenda
•

That all healthcare constituencies, including policy makers, purchasers, regulators, health
professionals, healthcare trustees and management, and consumers, commit to a national
statement of purpose for the healthcare system as a whole and to a shared agenda of six aims
for improvement that can raise the quality of care to unprecedented levels.

•

That clinicians and patients and the healthcare organizations that support care delivery adopt
a new set of principles to guide the redesign of care processes.

•

That the Department of Health and Human Services identify a set of priority conditions
upon which to focus initial efforts, provide resources to stimulate innovation, and initiate
the change process.

•

That healthcare organizations design and implement more effective organizational support
processes to make change in the delivery of care possible.

•

That purchasers, regulators, health professions, educational institutions, and the Department
of Health and Human Services create an environment that fosters and rewards improvement
by (1) creating an infrastructure to support evidence-based practice, (2) facilitating the use
of information technology, (3) aligning payment incentives, and (4) preparing the workforce to better serve patients in a world of expanding knowledge and rapid change.

a culture of improving quality of care. The committee proposed six components
that define quality in healthcare. High-quality healthcare should be:
• Safe: Avoiding injuries to patients from the care that is intended to help
them.
• Effective: Providing services based on scientific knowledge to all who
could benefit and refraining from providing services to those not likely
to benefit (avoiding underuse and overuse, respectively).
• Patient centered: Providing care that is respectful of and responsive to individual patient preferences, needs, and values and ensuring that patient
values guide all clinical decisions.
• Timely: Reducing waits and sometimes harmful delays for both those
who receive and those who give care.
• Efficient: Avoiding waste, including waste of equipment, supplies, ideas,
and energy.
• Equitable: Providing care that does not vary in quality because of personal
characteristics such as gender, ethnicity, geographic location, and socioeconomic status.
Arguably, hospitals and other healthcare institutions have been addressing
these areas of quality improvement for decades. Yet, in 2003, the RAND Corporation published a study of representative populations of patients in the United
States and discovered that only 54 percent of the recommended treatments were
provided.17 Why have we seen little progress? The use of measurement for the
continuous improvement of high-quality process—quality management—that
revolutionized manufacturing and service industries in the 1980s appears to have

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had little or no effect on the healthcare sector.18 Once an innovation has been
adopted by the first 15 to 20 percent of a field or industry, it becomes an almost
unstoppable process.19
Despite the enormous efforts to date, the strong resistance to change in healthcare suggests we have not reached the breakthrough point. Resistance can occur for
many reasons. Among them are the technical challenges in distinguishing quality
across physicians and other healthcare providers; the unwillingness of hospitals,
patients, and physicians to use the information derived from quality management;
and the fear among physicians that quality indicators may increase litigation
risks if plaintiffs’ attorneys use the information as evidence to bolster malpractice
claims.20 Probably the most compelling reason we have seen little progress is that
medicine is still a so-called cottage industry with very little standardization across
physicians, nurses, or hospitals in how to deliver high quality of care. In fact, autonomy among individual providers—the ability to practice individual discretion
within professionally accepted boundaries in the care of an individual patient—is
a treasured value. Reinertsen and Schellekens pointed out the paradox of physician autonomy, in that as patients suffer injury, physician autonomy is reduced
through regulatory and health plan oversight of medical decision making.21

PRINCIPLES ESSENTIAL TO PROMOTING
QUALITY OF CARE
Improving quality of care in the healthcare system is still a work in progress. Having a robust definition of the dimensions of quality care is insufficient to accomplish
the goal of continuous improvement. As stated earlier, quality consists of the degree
to which health services for individuals and populations increase the likelihood of
desired health outcomes (quality principles), are consistent with current professional
knowledge (practitioner skill), and meet the expectations of healthcare consumers
(the marketplace). Successful healthcare organizations—be they hospitals, physicians’ offices, pharmacies, nursing homes, or ambulatory centers—will have understood, identified, and put into practice all of the following essential principles:
1.
2.
3.
4.
5.

Leadership.
Measurement.
Reliability.
Practitioner skills.
The marketplace.

KEY PRINCIPLE 1: LEADERSHIP
In its simplest definition, leadership is the ability to influence behavior. The
reason for changing behavior is to reach specific goals within an organization.
The published literature on leadership is based on anecdotal and theoretical discussions. Less than 5 percent of these articles are empirically based, and most are
based on demographic characteristics or personality traits of leaders.22 Despite

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this, publications describing methods of personal development of leadership skills
fill the shelves of bookstores. This discussion attempts to summarize briefly the
basic and practical elements consistently associated with strong leaders.
a. Theories of Leadership
In 1977, a long-standing debate among the faculty of U.S. business
schools began when a Harvard Business School professor published an
article entitled “Managers and Leaders: Are They Different?”23 In 1990,
Kotter, a highly regarded thought leader in change theory, differentiated
leadership from management and cautioned businesses to avoid confusing
the two.24 Management copes with the existing and growing complexity
of our organizations, and leadership copes with change and transforming
organizations to a vision with specific goals.25 Kotter asserted that most
U.S. corporations were overmanaged and underled and that both strong
leadership and management were essential to success.26 Leadership is not
managing a spreadsheet but, rather, dealing in a disciplined manner with
the complex world of human drives, desires, inspiration, and vision.
Berwick—a pediatrician and international thought leader in quality improvement in healthcare—questioned the common practice of defining
healthcare improvement as changing regulatory, payment, and organizational structures under which care is given.27 In many cases, this results
in an emphasis on cost management and organizational downsizing
with an associated loss of quality and safety. Berwick, now president of
the Institute of Healthcare Improvement, stated that the failure to move
the quality agenda forward was due to the failure of leadership and the
inability of medical administrators and the professional workforce to innovate.28 In 2005, Freed, in his detailed review of hospital turnovers,
summarized the issue of leadership and management succinctly. He
stated that hospitals that are underled may not do the right things and
can find themselves at an eventual competitive disadvantage.29 Hospitals
that are undermanaged may not do things right and can find themselves
eventually unable to execute.30
b. The Individual Characteristics of Successful Leaders
Harsdorff and colleagues evaluated approximately 800 acknowledged
leaders from different U.S. business sectors, including healthcare.31 The
universal finding or traits that correlate with successful leaders are:
• Absolute personal integrity, including the ability to keep
confidences.
• The ability to innovate.
• The ability to build partnerships in times of limited resources.
• Superior intelligence.
• The ability to hire and develop the best talent available.

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Personal integrity must include an uncompromising approach to matters
of safety, service, and quality of care. Careful listening to what physicians, consumers and patients, and the hospital staff desire and expect is
required. Innovation and superior intelligence include the ability to project
a specific vision and its practical goals to every individual in the organization as well as generate a very high percentage of strong buy-in by the
employees. “The process of developing a winning strategy is . . . messy,
experimental, and iterative and it is driven from the bottom up.”32
So-called transformational leaders, as opposed to those who manage by
command and control, have the ability to transform cultures to create a
context more conducive to the integration of evidence into clinical and
management practice.33 The ability to build partnerships through personal
relations and highly effective meetings can lead to the empowerment of
staff and a sense of ownership that drives the passion for high-quality
care as well as high sensitivity to possible areas of risk. This unleashes
the innovative potential of the staff in a way that is not common in
healthcare. The ability to hire and develop the best talent available provides
amplification of all of the previous activities and moves the organization
toward a continuous cycle of improvement in multiple areas of caregiving, quality service, safety, and cost-effectiveness. All of these steps help
lead to a highly effective organizational memory.
Other characteristics of transformational leaders include discipline and
humility. “Disciplined attention is the currency of leadership” summarizes one of the characteristics contributing to a turnaround agent’s
efficacy in getting the attention he or she needs.34 “The most powerfully transformative executives possess a paradoxical mixture of personal
humility and professional will. They are timid and ferocious. Shy and
fearless. They are rare—and unstoppable”35 The turnaround agent is
Level 5; he subordinates his role to that of the hospital for which he is
clearing a safe path.
c. Leadership and Change
Coping with change is an essential focus of the effective leader. Every
healthcare leader rapidly discovers that making a significant change (to
transform or transition) is usually difficult to achieve and even harder
to sustain. Often the toughest task for a leader in effecting change is
mobilizing people throughout the organization to do adaptive work.
“Adaptive work is required when our deeply held beliefs are challenged,
when the values that made us successful become less relevant, and when
legitimate, yet competing, perspectives emerge.”36 “You don’t have to
be managing people for long before you find out that people don’t like
change.”37
Hospital medical staff members’ failure to follow national guidelines to
provide beta blockers or aspirin after a heart attack, failing to immunize
patients with pneumococcal vaccine under Centers for Disease Control

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and Prevention and Medicare guidelines, or continuing antibiotics longer
than recommended by their own surgical societies with the associated risk
of resistant organisms are examples of resistance to change. Some medical
staff meetings can become war zones of resistance as checklists to remind
physicians of evidence-based care are denounced as so-called cookbook
medicine. Of interest, when education and negotiation have failed, regulation, such as incorporating quality goals into hospital policies or medical
staff bylaws and increasing peer accountability, makes these issues vanish
with no evidence of patient injury. If resistance is a consequence of the
lack of clear goal setting and compelling objective information,38 the essential role of the leader is to provide clear goals as well as the empirical
information to help in clinical and administrative decision making.
Individuals in hospitals, as in many other organizations, find it hard to
believe that “change is the only constant.”39 But other industries have
gone further than healthcare in recognizing that “individuals and organizations that are good react quickly to change. Individuals and organizations that are great create change.”40 The rapid rate of change in
healthcare makes the ability to accomplish appropriate change an essential skill for all healthcare administrators, medical staffs, and clinical
staffs. An important role of leadership is to set organizational goals and
through communication (dissemination) guide the organization to accomplish the needed change (adherence).41
Kotter’s eight-stage process is an effective tool for coping with change.42
In brief, his eight-stage process to create change can be summarized as:
1. Establish a sense of urgency.
2. Create the guiding coalition.
3. Develop a vision and strategy.
4. Communicate the change vision.
5. Empower broad-based action.
6. Generate short-term wins.
7. Consolidate gains and produce more change.
8. Anchor new approaches in the culture.
In many situations, however, an effort to improve a process may stall for unknown reasons. A practical and useful tool called the ADKAR model has been
developed by Prosci, an independent research company. More than 300 organizations were surveyed, and Prosci found that there are five stages that a group
must pass through to accomplish a sustainable change.43 Different members of
the group may be at different stages at different times, causing the process to
stall. The ADKAR psychological model can be used to accelerate the change
process.

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•
•
•
•
•

73

Awareness of the need to change.
Desire to participate and support the change.
Knowledge of how to change.
Ability to implement the change.
Reinforcement to keep the change in place.

In evaluating a hospital management team or any group of people essential to a
change process, each element can be rated on a scale of 1 (no awareness) to 5 (complete awareness). The strength of this tool is that it turns opinion into observable
fact and can be used by anyone involved in the change process for self-assessment
or for organizations undertaking transformation. After the rating process (which
can include averaging several observers’ ratings), any element with a rating of 3 or
less needs attention. The focus must be sequential, and awareness of each step is
a prerequisite to the next. Complete implementation of change is highly unlikely
until each element is accomplished. This simple tool allows the quantification of
each stage, understanding what awareness or skills the group or individuals possess
or lack. It also guides priority setting because teaching new skills to individuals who
have neither the awareness nor the desire for change is a futile effort.
Examples of airline success in safety and innovation are being discussed more
frequently in healthcare. It is worthwhile to read about the early days of Southwest
Airlines and note that all the elements of leadership noted previously are now considered routine in their company culture.44 The durability of the Southwest Airlines
culture appears to be because of these elements. But after the early days of struggle,
one element seems to stand out in the employees’ interactions with customers, both
as a reason for initial success and sustainability. The paramount key to Southwest
Airlines’ success is the employees taking pride of ownership in the service they provide. Compare the Southwest approach to the healthcare industry with its shortage
of workers, intense bidding for personnel such as nursing, declining revenues leading to cutbacks in benefits, and a premium on productivity to the point of mandated nursing-patient ratios. If a healthcare organization does not state outright that
ownership of the process and outcome of the services we deliver is impossible, we
certainly act as if it is. In fact, the concept of providing and promoting job security
to a permanent core of employees as a form of ownership for healthcare workers
is simply not part of the culture in many healthcare institutions. Many healthcare
institutions act as if they are entitled to their patients’ loyalty because of their mere
presence in the marketplace and do not act as an entrepreneurial organization trying
to earn and retain the loyalty of their patients and their families.
Genuine leadership in healthcare drives success through all the elements mentioned previously, but it is sustained by the promotion of a sense of personal ownership of the processes and outcomes for the patients cared for in our institutions.
Personal ownership is an extraordinary potential force in healthcare organizations.
It drives process improvement, risk awareness, communication, and innovation
to achieve the levels of service and clinical performance that patients desire and
that we all want for ourselves and our loved ones. Kotter clarifies: “What’s crucial
about a vision is not its originality but how well it serves the interests of important

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constituencies—customers, stockholders, employees—and how easily it can be
translated into a realistic competitive strategy.”45 No one is better qualified than
those same constituencies to participate actively in vision formulation. Participation in vision formation generates personal and organizational ownership.

KEY PRINCIPLE 2: MEASUREMENT
Quality of care can theoretically be measured by outcomes (a healthcare outcome is the change in the health status of the patient that is a direct result of care
provided) or process (what providers do to and for patients). Outcome measurements have been a powerful tool in cardiovascular surgery and hospital-acquired
infections (see figure 3.1).

Figure 3.1 An Example of Coronary Artery Bypass Graft Mortality
Variation among California Hospitals1

Volume

California State
Average =
2.91%

146
222
308
158
239
63
527
198
0%

2%

4%

6%

8%

10% 12% 14% 16% 18%

1

Parker, J. P., Z. Li, B. Danielsen, J. Marcin, et al. 2006. The California Report on Coronary
Artery Bypass Graft Surgery 2003 Hospital Data. Sacramento, CA: California Office of Statewide Health Planning and Development. Available at: http://www.oshpd.state.ca.us/HQAD/
Outcomes/Studies/cabg/2003Report/2003Report.pdf. Accessed December 17, 2006.

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The majority of our discussion, however, will be describing process measurements because they are the most common and are more easily measured than
changes in patient health status. Measurement of process is often preferred because
process is under relatively greater control of providers, needs a shorter time frame
for results, can directly inform improvement, and may not require statistical adjustment for severity of illness.46 Stated simply, certain evidence-based interactions
with the patient are performed appropriately in a timely fashion or they are not.
In a patient with pneumonia, either the antibiotic was given on time or it was not.
In a patient with a heart attack, either an aspirin was given within a specific time
period or it was not. These processes are examples of the nationally reported core
measures reported by hospitals on a quarterly basis to JCAHO and the Centers
for Medicare and Medicaid Services (CMS). The quality indicators have become
a significant part of hospital and physician assessment. Clinical studies are appearing correlating quality of care with patient survival.47 When paired with cost or
efficiency of care, quality indicator graphs provide striking visual correlations (see
figure 3.2).
Who is the doctor in the upper right quadrant offering risk-adjusted high-quality care at the greatest efficiency? These individuals are good for the healthcare
system and provide evidence that high-quality care can be given without increases
in marginal costs.

Figure 3.2 Physician Performance Disclosure Using Quality
and Cost Metrics (adapted from Regence Blue Shield)1

1

Milstein, Arnold. 2004. “Clinical Climate Change: How Purchasers Will Hinge Provider
Revenue on Superior Cost Efficiency and Quality.” Available at: http://council.brandeis.edu/
pubs/Princeton%20XI/Arnold%20Milstein.pdf. Accessed December 12, 2006. Reproduced by
permission of the author.

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The government and commercial payers have identified the value of measurement, whereas healthcare providers are less certain. Quality measures are reportable
to the public in the form of core measures. These indicators have had a tremendous
impact on how our industry cares for patients and are directly related to the IOM’s
“effective” characteristic of quality care. There has always been resistance when
anyone in the industry (hospitals, patients, or payers) suggests that medicine
should be practiced in a more predictable and reliable way. So-called cookbook
medicine has developed a negative connotation to some healthcare providers.
Opponents of practicing evidence-based medicine claim that practicing medicine
cannot be defined in such simple terms as these evidence-based processes. But the
use of processes demonstrated in randomized controlled trials that lead to better
patient outcomes promote better health and outcomes.
The CMS has helped bring about a change in the acceptance of the processdefined approach to quality. The publicly available core measures are a set of
processes that improve the care we provide patients. To date, these measures have
improved clinical outcomes in some of the highest-volume illnesses, namely pneumonia, congestive heart failure, and acute myocardial infarction, and surgical-site
infection. New measures in surgical care improvement, childhood asthma, and
behavioral health are also in development. The measures are based on extensive clinical research, are evidence based, and have a focus on improving patient
outcomes. The core measures have created the foundation for evidence-based
metrics that meet the IOM definition of effective care in some prevalent medical
conditions.
CMS makes these metrics transparent to the public on the Department
of Health and Human Services Hospital Compare Web site, http://www.
hospitalcompare.hhs.gov. They require participation by the hospital in order to
receive yearly payment increases for the care of Medicare patients. The Web site
allows any individual with access to the Internet to compare how hospitals perform these certain processes. According to the Web site, “Hospital Compare is a
consumer-oriented website that provides information on how well hospitals provide recommended care to their patients.” CMS has partnered with the Hospital
Quality Alliance (HQA) in this project. The HQA is a public-private collaboration established to promote reporting on hospital quality of care. The HQA consists
of organizations that represent consumers, hospitals, doctors, employers, accrediting organizations, and federal agencies. Similar public reporting initiatives are
being promoted by states and multiple managed-care payers.

KEY PRINCIPLE 3: RELIABILITY
Underlying nearly every identified problem in the hospital setting is the problem of reliable process. In evaluating highly reliable organizations, five principles
have been found to be universal. They are command and control, risk appreciation, a specific quality component of the industry, metrics driving management,
and reward.48

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• Command and control: Performance goals shared and agreed upon
throughout the organization.
• Risk appreciation: Whether there is knowledge that risk exists, and if there
is knowledge that risk exists, the extent to which it is acknowledged and
appropriately mitigated and/or minimized.
• Quality: Policies and procedures for promoting high-quality performance.
• Metrics: A system of ongoing checks to monitor hazardous conditions
and used as the basis for accountability.
• Reward: The payoff an individual or organization receives for behaving
one way or another; expected social compensation or disciplinary action
to correct or reinforce a behavior, and the most powerful is recognition.
Of interest, the term command and control was used originally because preceding studies on reliability were on aircraft carriers.49 This is not intended to suggest that each hospital leader should function in an inflexible military command
and control demand mode. In fact, a highly reliable organization (HRO) must
have mechanisms to support flexibility, organizational support for constrained
improvisation on the part of lower level people, and cognition management
methods.50
The principles of an HRO have been applied and monitored for a decade in one
healthcare organization and may be used as its own control to compare outcomes
once the principles were stopped. A large pediatric intensive care unit (PICU)
providing care for a large geographic area applied the Libuser principles of an
HRO to support the bedside caregiver from 1989 to 1999. Admissions, daily
census, ventilator use, and pediatric transports to the unit went up, and mortality and consequential events (events that lead to an increased level or amount of
care, neurological injury, or death) went down. Additionally, nursing turnover
was very low (approximately 5 percent). After the two champions of HROs left
the PICU, the new intensivists did away with the high-reliability strategy. Admissions, daily census, transports, and children on ventilators went down, whereas
mortality, consequential events, and employee turnover went up.51
Although reliability has been successfully achieved by anesthesiologists52 and
discussed by the Agency for Healthcare Research and Quality53 in its effort to promote patient safety, healthcare in general has not applied all of the Libuser principles consistently. This may be one of the reasons for the lack of progress pointed
out previously by Leape and Berwick.54 The organizational efforts of identifying
the rules and principles essential to reliable care and institutionalizing them in job
descriptions, measuring adherence to these job elements, allowing constrained or
supervised innovation at the bedside, and rewarding good results are not standard in the healthcare industry. Healthcare has been moving in a better direction
through the work of the Institute for Healthcare Improvement (IHI) and the
IOM, however. Further study into successful high reliability organizations and
innovative appropriate application of their ideas into healthcare may accelerate the
process of beneficial change.

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In figure 3.3, different areas of healthcare are compared with other industries and activities. The relative risk of death in an airplane crash is 1 in 1 million,
whereas the risk of death from climbing in the Himalayas is 1 in 100. Note that
anesthesiology and the transfusion process are ultrasafe as opposed to the other
healthcare areas. These ultrasafe areas have evolved through a focus on reliable and
standardized processes similar to the airline industry.
One of the challenges in creating reliable processes is variability. When measured, healthcare processes and outcomes have always demonstrated wide variability. The principles of risk adjustment in large samples have provided a degree
of comparability previously unavailable. The use of easily understandable visual
presentations have allowed physicians to compare their performance against what
they may or may not agree is a best practice.
Figure 3.4 demonstrates wide variability in the total charges and length of stay
in a single diagnosis related group (DRG) among a group of physicians. Five
variables are presented in this simple picture: physician (each circle), number of
cases for each physician (represented by the size of the circles), adjusted length
of stay, and adjusted charges (as a surrogate for cost). Length of stay and total
charges are adjusted for patient risk. The graph demonstrates wide variability in
both adjusted length of stay and total charges. Potential causes of the wide variability are different practice patterns among the physicians, inappropriate utilization of services, inefficient consultative services, or prolongation of hospitalization
for social reasons.

Figure 3.3 Average Rate per Exposure of Catastrophes and Associated
Deaths in Various Industries and Human Activities1
Fatal iatrogenic
adverse events
Cardiac surgery in
patient in ASA 3–5

Blood transfusion
Anesthesiology in
patient in ASA 1

Medical risk (total)

Chartered
flight

Himalayas
mountaineering
Microlight aircraft
or helicopters

10⫺2
Very unsafe

10⫺3

Road safety

Commercial
large jet aviation

Railways

Chemical industry (total)
10⫺4

10⫺5
Risk

Nuclear industry
10⫺6
Ultrasafe

1

Amalberti, R., Y. Auroy, D. Berwick, and P. Barach. 2005. “Five System Barriers to Achieving Ultrasafe Health Care.” Annals of Internal Medicine 142 (9): 756–64. Used by permission.

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Hospitals have approached these issues primarily through utilization management that appears to have been most successful following the institution of DRGs.
Because physicians have often been reluctant to judge their colleagues’ practice
patterns, the effectiveness of utilization management and review in hospitals is far
from consistent. Because of the complexity of utilization management and review,
the primary approach of healthcare payers has been to deal with cost control rather
than the complex underlying causes of cost expansion. Policies to reduce inappropriate variation in processes—be they HMOs with their own medical management
programs, capitation, discounted contracting, or federally mandated reductions in
physician payments—may have slowed the rise in medical costs and reduced inappropriate variation in utilization, but they have been far from successful.55
Value-based purchasing—achieving the highest possible quality at the lowest possible cost—is being adopted by Medicare and many managed care payers
as the next wave in healthcare purchasing. The concept is intuitively powerful
to patients and insurers; this will be the standard against which all hospitals and
physicians will be measured for the foreseeable future. Purchasers and consumers will seek the providers with the highest possible quality at the lowest possible
cost and reward them with both volume and incremental bonuses of money or

Figure 3.4 Variability in DRG 89 at a Single U.S. Hospital (information
derived from public data)1

1

Variability similar to this can be seen in almost any DRG measured at any facility.

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access to service (e.g., clinical information technology). Those providers who have
low-quality scores and high costs will be assumed to have less value to purchasers
and consumers, and those providers, be they physicians or hospitals, will see their
market share shrink. Transparency to the public on both cost and quality through
public reporting on Web sites and in the media will presumably encourage consumers to make educated choices about seeking value in their choices about where
to seek care. The advent of high-deductible insurance products and health spending accounts may encourage consumers to act more rationally—in the economic
sense—in choosing providers.

KEY PRINCIPLE 4: PRACTITIONER SKILLS
The process of achieving consistently high quality of care in a reliable way consists of “doing the right thing right.” To do the right thing requires that physicians,
nurses, and all healthcare providers make the right decisions about appropriateness
of services and care for each patient (high-quality decision making), and to do it right
requires skill, judgment, and timeliness of execution (high-quality performance).56
The IOM characterized the threats to quality into three broad areas that affect practitioners: overuse (receiving treatment of no value), underuse (failing to
receive needed treatment), and misuse (errors and defects in treatment).57 The
physicians and practitioners that are making treatment decisions must be doing
so in a way that appropriately utilizes resources without overuse, underuse, or
misuse. This is difficult to control because of variability in physician treatment
practices. Evidence-based medicine has made its way into mainstream health decision making to reduce this variability. The concept relies on evidence to help practitioners decide on the appropriateness of services and care and how to execute the
patient’s care appropriately.
Both overuse and underuse represent limitations in the practitioners’ decision making ability. Both areas focus on the competence of the practitioners and
their ability to utilize resources appropriately. Questions to ask when evaluating
whether overuse or underuse has occurred are:
1.
2.
3.
4.

Do they utilize resources appropriately?
Are they ordering too many tests?
Are they ordering too few tests?
Is therapy appropriate and consistent with individual patients’ riskbenefit calculus?

Once a treatment decision is made, the duty of quality falls on the performance
of the individuals providing the care to the patient (high-quality performance)
and the systems in which they work. In the treatment phase of the care cycle,
the providers must have processes and practices in place to ensure the treatment
protocols are completed and there is no misuse. When errors and defects occur,
quality is suboptimized (not an on-off switch but, rather, a spectrum) and patient
safety is at risk.

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KEY PRINCIPLE 5: THE MARKETPLACE
The marketplace has had a profound effect on moving hospital quality forward, and it is essential to understanding the role of quality of care in the current
environment of healthcare. Despite the studies cited earlier,58 quality metrics have
been improving primarily by public transparency and the promise of improved
payment and patient volumes. The value proposition of quality and efficiency
and tying reimbursement to reporting or excelling in performance on specified
quality metrics (pay for performance) has been accepted by nearly all third-party
payers and has become a significant force in healthcare. This model has gained
considerable attention by employers and payers for the following reasons. First,
healthcare premium costs have continued to rise at rates as high as 14 percent per
year. Although there have been some decreases in recent years in premium costs,
workers are still only earning an additional 2.1 percent to 3.8 percent per year
(see figure 3.5). The additional costs must be absorbed by one of two parties: the
individual or the insurer. Additionally, the number of uninsured has continued to
rise to a high of 45 million Americans, and that number is expected to increase to
51 million by 2010.59
The basic economics in healthcare are similar to most industries and involve the management of three main principles: cost, volume, and revenue. We
must understand the role quality plays in the market because it is fundamental
to the environment in which we operate. Quality is an important component
in several areas: from the basic business model of healthcare and the financial
impact on the industry (practitioners, facilities, and customers) to the public
opinion driving decisions for treatment plans and treatment locations. For the
industry to adopt changes, institutions must “realize a financial return on investment in a reasonable time frame, using a reasonable rate of discounting. This
may be realized as ‘bankable dollars’ (profit), a reduction in losses for a given
program or population, or avoided costs. In addition, a business case may exist
if the investing entity believes that a positive indirect effect on organizational
function and sustainability will accrue within a reasonable time frame.”60
The industry faces many challenges when it comes to costs. One problem is the
significant variation of cost in U.S. healthcare.61 Some hospitals perform better
quality care at a much lower cost than others. The industry also faces high fixed
costs and a highly paid professional workforce, so it takes significant economies
of scale to realize all the value. In addition, the cost of treating clinical complications is very high and contributes significantly to the rising cost of healthcare.
One study indicated that between 10 percent and 20 percent of patients receiving
greater than 48 hours of mechanical ventilation will develop ventilator-associated
pneumonia (VAP). Treatment of VAP costs between $10,019 and $13,647 in
additional hospital costs during the prolonged hospital stay.62
One key element to the economic model that quality should help improve at
facilities is volume. Practitioners and treatment facilities are consistently judged
by visitors based, in large part, on the quality of care they are providing. Although
some practitioners are able to thrive because of their technical proficiency, patients

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Figure 3.5 Yearly Percentage Increase of Wages Compared to Healthcare
Premiums1

1

Henry J. Kaiser Family Foundation and the Health Research Educational Trust. 2006. “Employer Health Benefits: 2006 Annual Survey.” This information was reprinted with permission
from the Henry J. Kaiser Family Foundation. The Kaiser Family Foundation, based in Menlo
Park, California, is a nonprofit, private operating foundation focusing on the major healthcare
issues facing the nation and is not associated with Kaiser Permanente or Kaiser Industries.
* Estimate is statistically different from estimate for the previous year show at p < .05. No statistical tests are conducted for years prior to 1999.
?
Data on percentage increase in workers’ earnings are seasonally adjusted data from the Current
Employment Statistics Survey (April to April.)
Note: Data on premium increases reflect the cost of health insurance premiums for a family of
four.
Source: Kaiser/HRET Survey of Employer-Sponsored Health Benefits, 1999–2006; KPMG
Survey of Employer-Sponsored Health Benefits, 1993, 1996; Health Insurance Association
of America (HIAA), 1988, 1989, 1990; Bureau of Labor Statistics, Consumer Price Index,
U.S. City Average of Annual Inflation (April to April), 1988–2006; Bureau of Labor Statistics,
Seasonally Adjusted Data from the Current Employment Statistics Survey (April to April),
1988–2006.

return and also refer their friends based on the quality experiences they have had.
If a patient has a bad experience and receives the wrong drug at a facility (a misuse)
or finds out a physician did not order a test another physician thought was indicated (underuse), the patient may be less likely to seek care at that facility or from
that physician in the future. Additionally, patients will tell their friends about the
bad experience they had. Although opportunities for service recovery exist, many
patients and managed care plans are not returning to physicians and hospitals that
provide poor quality of care.

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All healthcare providers, physicians included, will soon be impacted by the financial impact of improving quality of care. Many have already felt the impact
of pay for performance. Managed care plans and Medicare are offering financial
and volume referral incentives to physicians and hospitals that demonstrate superior adherence to evidence-based practices and better outcomes. In some pay-forperformance plans, the higher performing entities receive greater than average
payments, whereas the poorer performers will receive less than the average payment. The federal government is committed to developing more quality metrics
in more diagnostic and therapeutic categories and is poised to implement pay-forperformance bonuses to hospitals and physicians in 2008 or 2009.63

Tenet Healthcare and the Commitment to Quality: A Case Study
Formed in 1996 in the merger of two for-profit healthcare systems, American
Medical International and National Medical Enterprises, Tenet Healthcare enjoyed
rapid growth with the subsequent acquisition of more than forty hospitals until
2002. Hospital volumes were growing rapidly, and the profitability of its hospitals and the holding entity was at an all-time high. In fall 2002, however, Tenet
faced serious and, to some observers, fatal charges against it and some of its hospitals. Based on analysis by independent observers, Tenet was reported to have
escalated its charges so that, in a substantial minority of its hospitals, the hospitals
were receiving an unacceptably high proportion of Medicare outlier payments. In
the same week, the Federal Bureau of Investigation raided a Tenet hospital in Redding, California—Redding Medical Center—based on allegations of overuse and
inappropriate utilization of invasive cardiac procedures such as cardiac catheterization and coronary artery bypass graft surgery. Subsequently, in 2006, Tenet settled
with the federal government for $750 million to settle all charges lodged against
it by the federal government related to these and other issues. In late 2005, Tenet
also settled multimillion dollar liability claims by patients who had been treated for
cardiac disease at Redding Medical Center.
In early 2003, the new senior leadership of Tenet recognized that perceptions of
the quality of care in its hospitals constituted a serious threat to its long- and shortterm viability. Supported by the board of directors, Tenet and its leadership committed to making substantial improvements in the quality of care provided in its
hospitals and associated healthcare institutions. This new initiative—known as the
Commitment to Quality (C2Q)—had as its sustaining mission the improvement
of every aspect of care. Recognizing the rising demands for both improvement
and transparency in quality and safety of care from regulators, payers, patients,
and employers, Tenet and its leadership committed to supporting and sustaining improvement in six dimensions of quality of care: evidence-based medicine,
patient safety, physician excellence, nursing excellence, patient flow and capacity
management, and clinical resource management. Subsequently, in 2005, additional
dimensions of improvement were added to the Commitment to Quality. Service

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excellence, which had been a focus of improvement in Tenet Healthcare since 2000
in its Target 100 program, merged with the Commitment to Quality.
Senior management requested an evaluation of the quality of care for each hospital in the identified dimensions as well as a plan to improve the quality of care—
consistent with evidence-based goals for quality and safety—that Tenet hospital
leaders would be held accountable for achieving. Senior leaders recognized that the
change management process around the Commitment to Quality programs would
be both significant and difficult but insisted on sustainable and measurable progress
in return for providing the resources to improve the quality of care.
Establishing ongoing communication and dialogue about the strategic implementation plan for the Commitment to Quality among senior and midlevel leaders
in the corporate and hospital leadership structure was a critical first step in the implementation of C2Q. Daylong meetings were held in national and regional venues to vet the initiative and solicit input and feedback from corporate and hospital
leaders.
Initial reactions to the initiative were enthusiastic but tempered by concerns
about draining resources from bedside care to improve quality. Financial officers
were skeptical that the proposed investment in improving quality and safety did not
have sufficient financial return to the hospitals. Historically, Tenet had a decentralized model of corporate oversight in clinical care and quality improvement. Some
leaders expressed concern about a broad initiative developed by corporate management being undermined by staff and leadership in the hospitals. They requested
the right to prioritize the quality initiatives based on both the hospitals’ baseline
performance and readiness for change.
One apparent barrier to launching the Commitment to Quality was the lack of
standardized metrics in many of the dimensions of the program across the hospitals. Although many of the higher-level metrics that were reported through common reporting systems (e.g., length of stay) to regional and corporate leaders, in
some dimensions—especially in detailed operational metrics such as emergency
room dwell time or operating room start and stop times—little or no standardization across the hospitals existed. One of the first tasks was to establish a common
set of metrics for each goal and objective and provide standard rationales, definitions, data collection protocols, as well as data reporting guidelines. Each hospital
spent one month collecting and validating each metric in the complete list prior
to beginning implementation.
The hospital leadership teams also raised significant issue about the resources
available at each hospital to implement the changes necessary to achieve rapid but
sustainable change in quality and safety. They expressed concern that diverting
hospital resources toward improvement compromised the ability to deliver care
by midlevel managers and frontline staff. They also acknowledged that detailed
expertise in change management, improvement methods and techniques, and deep
knowledge of hospital systems was not uniformly available or of the same quality
across all Tenet facilities. They did agree that the transfer of such knowledge to

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the senior leadership, midlevel managers, and frontline staff would be required to
create a sustainable improvement in performance as well as a change in the culture
of improvement in the hospitals. To address these concerns, an implementation
vehicle known as the C2Q Transformation Team was created. Each of the four geographic regions in the Tenet Healthcare system has an improvement team known
as a Transformation Team. Each team is staffed by a regional team leader, typically
an experienced hospital senior manager (e.g., hospital chief operating officer, chief
nursing officer). The team is also staffed by subject matter experts—typically nurse
leaders—in case management, emergency room management, and operating room
management.
After the in-depth monthlong self-assessment, the C2Q Transformation Teams
spend eight weeks full-time on-site at each hospital working side-by-side with their
hospital counterparts to achieve improvement on a set of mutually agreed upon
goals established during the first week on-site. The regional Transformation Team
is then available to the hospitals through multiple communication vehicles and
returns to conduct sustainability visits every 8 to 12 weeks. A second round of
four-week on-site visits was begun in 2005 with the goals of integrating Tenet’s
service quality initiatives with C2Q and focusing on length of stay reduction and
pharmacy safety as well as continuing to improve performance in the initial six C2Q
dimensions. Examples of specific projects and goals in each dimension of quality
are described in table 3.3.

Table 3.3
Quality: Goals and Targets
Commitment to Quality
Dimension

Example of Goal

Associated Metric

Example of Target

Evidence-based
medicine

Improve core measure Number of times the Greater than or equal
performance in acute patient received
to 95% adherence
myocardial infarcappropriate treatto evidence-based
tion (AMI)
ment / Number of op- standards
portunities to provide
evidence-based treatment appropriate for
the patient

Patient safety

Reduce hospitalNumber of patients
acquired infections
with central venous
(e.g., central venous catheter–associated
catheter–associated
bloodstream infecbloodstream infections / 1,000
tions (CVCBSI)
patient days with
device in place

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Reduce CVCBSIs to
top decile performance in national comparative databases

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Table 3.3
Quality: Goals and Targets (continued)
Physician excellence

Implement and moni- Percentage of all new 100% timely and accutor timely physician
and reappointment
rate credentialing and
privileging and crecredentialing and
privileging
dentialing
privileging completed
within time specified
by hospital and medical staff bylaws

Nursing excellence

Improve nursing satis- Employee satisfaction Improve nursing satisfaction and increase
scores
faction scores by 20%
nursing retention
for nurses
Reduce new-hire and
rates
Percentage turnover
veteran turnover rates
for new hires (within to 10%
year one)
Percentage turnover
for all
nurses

Capacity management Improve capacity
and patient flow
management in the
emergency room
(ER)

Utilization management and review

Left without being
LWBS ≤ 2%
seen (LWBS) Patient ER dwell time (disdwell time in ER for charged) ≤ 2 hours
patients who are dis- ER dwell time (adcharged from the ER mitted) ≤ 4 hours
Patient dwell time in
the ER for patients
who are admitted to
the hospital

Insure that all patients Percentage of patients 95%
undergoing percuundergoing the protaneous angioplasty
cedures that are Class
and/or coronary
I or Class IIA (ACC/
artery bypass graft
AHA guidelines)
and/or cardiac valve
replacement receive
the procedure
consistent with
American College of
Cardiology/American Heart Association (ACC/AHA)
appropriateness
guidelines

Clinical resource man- Reduce variable cost Percentage of all
agement
per case of highfirst-time total hip
volume, high-cost
replacements using
procedures while
clinician-approved
maintaining clinicost-effective proscal effectiveness for
theses
patient process and
outcome (e.g., total
hip replacement)

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90%

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Among the positive forces at work in the Commitment to Quality in Tenet
Healthcare is leadership. Involvement by the most senior leaders at Tenet in communicating and reinforcing key strategies and demanding accountability for results
has been vital to the success of the C2Q initiative in promoting change. The board
of directors has adopted an incentive compensation system based on a so-called
balanced scorecard of results that emphasizes clinical quality, safety, and service
excellence equally with financial results. Transparency among the hospital leaders
about their quality performance has also promoted healthy competition to achieve
higher and higher levels of performance. Both transparency and accountability have
accelerated change and improvement in the hospitals. Commencing with the collection of core measure data for heart attack in mid-2003 with adherence rates of
about 50 percent for the initial measure set, adherence to the CMS expanded core
measures in heart attack was 95 percent among the 20,000 patients treated in 2006
in Tenet hospitals.
Leadership and commitment must be accompanied by resources to achieve results. Tenet commits more than $60 million a year in corporate and regional
resources to supporting quality and quality-related initiatives on an annual revenue
base of $9.5 billion. More than one-third of these resources are committed to developing informatics infrastructures that enable consistent and accurate data collection,
information transfer, and rapid sharing of both results and improvement strategies
over a corporate-wide intranet. Significant investments are made in supporting the
regional quality improvement infrastructure, including regional chief medical officers and regional directors of clinical quality improvement, who work collaboratively
with the regional Transformation Teams to sustain and improve quality, safety, and
cost-effectiveness. Collaboration between the hospitals and the regional teams has
promoted a 33 percent to 50 percent reduction in hospital-acquired infections such
as catheter-associated bloodstream infections with almost half the hospitals recording no catheter-associated bloodstream infections for more than a year.
Initially, the Commitment to Quality was envisioned as a corporate initiative that
would be implemented in similar ways in each hospital. Acceptance at the hospital
level was markedly enhanced by standardized metrics and goals but with customization of the improvement initiatives at the local level. In order to prevent each hospital from reinventing the wheel, so to speak, when addressing similar issues, success
stories and failures are shared among the hospitals, creating a virtual network of improvement teams that share strategies, tactics, and knowledge. For example, in order
to achieve 95 percent adherence to the acute myocardial infarction (AMI) core measures, several hospitals redesigned their relationships with their local emergency medical services to permit transmission of electrocardiogram tracings from the field to the
emergency department, allowing identification of ST-segment elevation heart attacks
in the field. Hospitals alerted to a ST-segment elevation AMI are able to mobilize cardiac catheterization teams that are ready when the patient arrives at the hospital and
have reduced the average so-called door-to-balloon time to an average of 45 minutes.
The emergency department and cardiology staff in those hospitals conducts national

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Web-enabled presentations to all the other hospitals and are available to mentor other
Tenet hospitals that are working to reduce door-to-balloon times.
These strategies are shared among regional improvement teams and utilize the
Tenet intranet to catalog the experiences and lessons learned across the system.
Many common improvement ideas and strategies evolved, but unique and innovative solutions to common problems continue to be reported after several years of
implementation. One hospital, which had implemented the Institute of Healthcare
Improvement bundles to reduce catheter-associated bloodstream infections, was
frustrated by its inability to reduce the rate of infection. In frustration, the chief
medical officer insisted that every physician placing central venous access be retrained and recertified. A core team of four physicians was certified and observed
by infection-control practitioners to monitor technique and the sterility of the
placement process. Within eight weeks, the rate of bloodstream infections associated with placement of central catheters had dropped 90 percent and achieved
performance equal to the lowest decile performers in the National Nosocomial Infections Surveillance (NNIS) database.
Providing an initial assessment for each hospital granted excellent opportunities
for the hospital medical staff and clinical and administrative leadership to address
issues they mutually determined to be important to the success of the hospital and
the care of the patients. Although many hospitals faced similar challenges in improvement in evidence-based medicine and patient safety, different challenges were observed in capacity management and patient flow. Standardized goals and metrics help
identify opportunities for improvement, but the solutions—although having some
common features—are primarily the result of frontline employees and midlevel managers conducting multidisciplinary improvement efforts. One hospital experienced
unacceptably high rates of diversion of ambulances from its emergency room—in
some months approaching 200 hours. Careful mapping of the flow and timing of patient movement from entering the emergency room through admission to a patient
care floor or intensive care unit identified several barriers to patient flow, including
poor communication between the emergency room staff and the receiving units and
long delays in the turnover of rooms by environmental services. Mapping and measuring the times associated with each part of the patient flow process resulted in new
communication protocols between the emergency room and the receiving care units
and service standards about response time. Hospital managers also reorganized the
staffing and team structure of environmental services to meet peak demand in patient
room cleaning and turnover. As a result, the hospital has less than ten hours of diversion a year and has consistently met the established goals of fewer than 2 percent of all
patients entering the emergency department leaving without being seen and average
dwell times of less than two hours for patients seen and discharged and less than four
hours for patients seen and admitted.
Continuous communication at every level of the organization and through multiple mechanisms is also vital to the success of C2Q. Repetition of the key messages in multiple forums and through e-mails, conference calls, regional and national

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meetings, corporate and local hospital written and in-person presentations, and in
face-to-face meetings is vital. Presentations and question-and-answer periods with
the hospital governing boards and medical staff, as well as employee forums with
frontline employees and midlevel managers, proved invaluable.

THE BUSINESS CASE FOR QUALITY
Healthcare has had a difficult time demonstrating the business case for quality because of the complexity of care and difficulty in capturing the real fixed
and variable costs of caring for patients. Other industries have long accepted the
theory first described by Deming that improvement in quality leads directly to a
decrease in cost. Better quality results in less rework, fewer mistakes and delays,
and a better use of time. Productivity improves as a result. By improving quality, the industry captures the market with better quality and lower price, is able
to innovate in the business and clinical practice of medicine, and so can provide
more jobs.64
The difficulty in demonstrating the business case in healthcare may be the result
of healthcare not having yet reached the level of quality that triggers the results as
defined by Deming. Healthcare lags significantly behind many industries in rates
of errors and the ability to capture the measures that permit maximal management of the complex healthcare process. The ability to provide timely and detailed
measurement in healthcare is time and personnel intensive because of insufficient
real-time information technology. In fact, as overburdened as healthcare workers
feel while manually gathering quality-related data, we are obtaining and using
only a small fraction of the information necessary for maximizing the management
of high-quality care.
What is the cost of quality? Does it raise the price of goods and services? Are
huge savings possible by implementing continual improvement efforts? These
questions are not easy ones, but quality is becoming increasingly measurable as
are its costs. In healthcare, the failure to prevent serious complications, such as a
hospital-acquired infection, may cost the patient his or her life, prolonged disability, and thousands of dollars in treatment. Avoidable surgical complication may
prolong hospitalization, result in disability or death, and cause great expense and
repeated procedures.
Healthcare organizations, however, have been reluctant to implement improvements because better quality has not been accompanied by better payment or improved profitability. The most recent business case for quality has been driven by
employers and third-party payers seeking value-based purchasing. Serious doubts
about the long-term sustainability of rising healthcare costs, the accelerating
numbers of uninsured, and the double-digit increases in healthcare premiums are
driving employers and health plans, as well as federal and state governments, to
demand cost-effective, safe, and patient-centered care. Both physicians and hospitals are being assessed with a combination of quality and efficiency (cost) measures

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and these measurements are being used to include or exclude both hospitals and
physicians from healthcare plans.
The current business case for quality is straightforward. Access to the patient
(both by volume and payment level) is being determined by demonstrating high
quality and cost efficiency. A clear understanding of the history and development
of the concept of quality patient care and the ability to understand, identify, and
utilize the key principles will help create successful healthcare organizations.

CONCLUSION
There has been a change in healthcare since the mid-1990s that will shape
the future of the industry. As Leape stated, “Ten years ago, no one was talking
about patient safety. Five years ago, before the IOM report, a small number in a
few pioneering places had developed a strong commitment, but its impact was
limited and most of health care was unaffected. Now, the majority of health
care institutions are involved to some extent and public awareness has soared.”65
Many exciting changes have occurred in the industry because of the increased
focus on safety and quality. Some of these changes may be short-lived, but some
will truly revolutionize the way healthcare is provided. Quality and safety are
important factors shaping the future of the industry for hospitals and medical
care providers. Quality metrics will shape physician practices as well as the processes in place at the hospitals in which they practice. Quality will define both
success and failure for physicians, hospitals, and the executives who lead in the
healthcare industry.

Key Concepts
• Quality consists of the degree to which health services for individuals and
populations increase the likelihood of desired health outcomes (quality
principles), are consistent with current professional knowledge (professional practitioner skill), and meet the expectations of healthcare users
(the marketplace).
• Successful healthcare organizations—be they hospitals, physicians’ offices, pharmacies, nursing homes, or ambulatory centers—will have
understood, identified, and put into practice all of the following essential
principles: leadership, measurement, reliability, practitioner skills, and
the marketplace.
• Access to the patient (both by volume and payment level) is being determined by demonstrating high quality and cost efficiency. A clear understanding of the history and development of the concept of quality patient
care and the ability to understand, identify, and utilize the key principles
will help create successful healthcare organizations.
• Quality metrics and practices will help define both success and failure
for physicians, hospitals, and the executives who lead in the healthcare
industry.

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NOTES
1. Deming, W. E. 1994. The New Economics. 2nd ed. SPC Press.
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3. Ibid.
4. Winder, Richard E., and Daniel K. Judd. 1996. “Organizational Orienteering:
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5. Lohr, K. N., M. S. Donaldson, and J. Harris-Wehling. 1992. “Medicare: A
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7. Conway, J. B., and S. N. Weingart. 2005. “Organizational Change in the Face
of Highly Public Errors. I. The Dana-Farber Cancer Institute Experience.” Agency for
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8. Kohn, K. T., J. M. Corrigan, and M. S. Donaldson. 1999. To Err Is Human:
Building a Safer Health System. Washington, D.C.: National Academy Press.
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10. Brennan, T. A., L. L. Leape, N. M. Laird, et al. 1991. “Incidence of Adverse
Events and Negligence in Hospitalized Patients: Results of the Harvard Medical Malpractice Study I.” New England Journal of Medicine 324: 370–76.
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12. Pope, Alexander. 1711. An Essay on Criticism 1. Line 525.
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14. Ibid., 2384–85.
15. Ibid., 2384.
16. Institute of Medicine. 2001. Crossing the Quality Chasm: A New Health System
for the 21st Century. Washington, D.C.: National Academy Press, 1.
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Care Delivered to Adults in the United States.” New England Journal of Medicine 348:
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18. Coye, Molly Joel. 2001. “No Toyotas in Healthcare: Why Medical Care Has
Not Evolved to Meet Patients’ Needs.” Health Affairs 20 (6): 44–56.
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21. Reinertsen, J., and W. Schellekens. 2005. 10 Powerful Ideas for Improving Patient
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22. Vance, E., and E. Larson. 2002. “Leadership Research in Business and Health
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31. Harsdorff, C., and D. Hamel. 2005. Personal communication with the authors.
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46. Higashi, T., P. G. Shekelle, et al. 2005. “Quality of Care Is Associated with
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54. Leape, L., and D. Berwick. 2005. “Five Years after To Err Is Human: What
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See also Freed, D. H. 2005. “Hospital Turnarounds: Agents, Approaches, Alchemy.”
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Care Has Not Evolved to Meet Patients’ Needs.” Health Affairs 20 (6): 44–56.
59. Commonwealth Fund Commission on a High Performance Health System.
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61. Davis, K., C. Schoen, and S. C. Schoenbaum. 2004. Mirror, Mirror on the Wall:
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63. Centers for Medicare and Medicaid Services. 2005. “Medicare ‘Pay for Performance (P4P)’ Initiatives.” Press release, January 31. Available at: http://www.cms.hhs.
gov/apps/media/press/release.asp?Counter=1343. Accessed December 18, 2006.
64. Deming, W. E. 1994. The New Economics. 2nd ed. SPC Press.
65. Leape, L., and D. Berwick. 2005. “Five Years after To Err Is Human: What
Have We Learned?” Journal of the American Medical Association 293: 2384–90, 2387.

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AUTHOR QUERIES

Chapter 3. Quality in Healthcare:
Concepts and Practice
AQ1: Please provide the city of publication and the page number of the text
quote.
AQ2: Please verify page range. 12Q–6 correct?
AQ3: Can you provide the location of the publisher for note 53?
AQ4: Please provide the city of publication.

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