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Will the private sector be excluded from the industrial revolution?

publication date: Nov 28, 2011
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Hospital care is moving from a profession to becoming an industrial process, argues Professor Richard Bohmer, professor of management practice at Harvard Business School.

In presentation in London last week, Bohmer outlined how the top US hospital groups are adopting a closed loop approach - one of constant improvement through learning and measuring. He is about to publish a paper on the subject and is the author of the 2009 book: Designing Care: Aligning the Nature and Management of Health Care.

These organisations are constantly seeking to understand what works best. The approach is very similar to that adopted by Helios in Germany and by the larger Dutch hospital groups.

Results are measured closely and increasingly accurate clinicial pathways are drawn up which doctors follow unless they have very good reasons for not doing so. Bohmer reckons such pathways can reach 85% compliance levels.
Bohmer sees the approach as leading to an industrial revolution in healthcare. This has several implications. Firstly it means that the role of the doctor changes. Bohmer puts it succinctly: “We need fewer doctors”. Instead he says they will be increasingly replaced by nurse practitioners and he has figures to show that the latter are growing at a much faster rate in the USA.

Secondly, it means doctors need different skills. Gone are the days of the individual practising a professional skill more akin to an art than a science.

The degree to which this happens varies greatly. In general, Bohmer says American doctors outside of a few big prestige groups such as The Mayo have yet to accept this move.

In Europe we think it is happening in the Netherlands where patient pathways are followed more and more strictly in public hospitals. German private hospitals have also led the way with Helios acting as a pioneer in measurement of outcomes. Rhoen and Asklepios have now formed a similar consortium.

Elsewhere in Europe we can only point to a few pioneers. Capio in Sweden, France, Germany and the UK is seeking to learn internationally and to compare results. And the former Capio CEO Per Batelson is adopting the same approach at his Global Health Partners chain of specialised clinics.

But, in general, we think private hospitals in Europe are standing on the sidelines. That reflects the fact that, in most countries and in most places, they remain hoteliers who have to attract independent physicians to work in their premises. This gives them little or no management control over output. Until private operators start to exert more control and to employ medics full time they will be excluded from the industrial revolution.

Not that Bohmer is particularly impressed by the English NHS either.
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