A message from George Halvorson,
Chairman and CEO, Kaiser Foundation Health Plan

 

People in various settings often ask me, “What exactly is Kaiser Permanente?”

That’s not an unreasonable question. As you know, we don’t fit into any obvious box or category. There aren’t many organizations in the world that look exactly like us. There are very few in the U.S. and only a few in the rest of the world.

The county-based health systems in Sweden do look quite a lot like us. The Swedish county-based care systems provide health care “insurance” coverage for their local people and then also care for them in the context of organized, patient-focused hospital/physician caregiver teams. Much like us, the Swedes also have vertically integrated, tightly linked care delivery and financing systems. But very few people in the U.S. know about the care teams in Sweden, so I usually can’t answer that question here – about who and what we are – by pointing to the Swedes.

So how do I answer? I tell people that we are at our core a community of caregivers. We are inherently a care system. We are people who deliver care. We are, in total, a fairly complex set of organizations that are mutually organized and aligned around improving total health and the delivery of care.

That basic fact of being caregivers gives us a certain consistent and collective set of values at our very heart. More than 160,000 people work at Kaiser Permanente. Roughly 140,000 of our people work in care delivery – in our hospitals, medical centers, pharmacies, laboratories, and related care sites. So we truly are basically caregivers. That explains a lot. That’s why we all start with a consistent set of values. Caregivers go into the caregiving professions to deliver care . . . to care for people.

Helping people is what we do – and we are an organization of people who deliberately choose to spend our lives and careers helping people. It is very much a matter of free will, free choice, and self-selection. No one is forced into nursing or cardiac surgery. People individually choose to be pediatricians, internists, pharmacists, lab technicians, and therapists in order to be of personal service – to make a positive personal difference in other people’s lives. Think of all the job classifications you see in the want ads seeking people to join us. Overwhelmingly, those jobs are caregiver jobs.

So, we begin both our organizational processes and our personal job choices around the delivery of care, and we have built our entire organization around care delivery. Our IT people who are building our robust new array of care support computer systems are also, in our new electronically-supported world, engaged in caregiving – and our IT people aren’t even in the 140,000 count of caregivers.

“But, don’t you also provide health coverage?” people sometimes ask me. “Isn’t health coverage at some level really what you do?” The answer is, “Yes, we also do provide health coverage.” We are both a health plan and a health care delivery organization. We definitely do provide health coverage for people, and we are proud to do that. But, the basic point that people very often miss is that, for us, coverage is very much a tool of care.

Why do I say that? Again, think of who we are. We provide health coverage so that we can help people get care. Health coverage for us is about making our care affordable, available, and accessible. Health coverage is an extremely important part of what we do as caregivers. Why? Because our caregivers could not and cannot deliver care and improve the health of our patients unless our marketing, sales, service and administration folks both successfully enroll members and competently serve members. Members are our patients. As caregivers, we need customers – including employers, trust funds, labor unions, government programs, and individuals – to buy our coverage. Then we need to make another sale, we need to get prospective members to choose us as their health plan so that we have patients to care for. Our health plan team sells to the customers and enrolls the members who become our patients. Our caregivers take care of those patients. It’s a good system . . . interlocking, interconnected, and mutually supportive.

So our health plan functions are fundamental and essential to our success – but they are absolutely not an end in themselves. While our membership is an important reflection of how well we meet the needs of our customers and members, we do not measure our success as an overall organization by our stand-alone achievements in selling coverage and enrolling members. Those are important achievements – but that is not how we judge ourselves. We measure our success, our value, and our organizational worth by how well we care for and improve the health of our members and the communities we serve.

A business magazine did an interview with me a month or so ago and asked the question, “Who is your most respected competitor?” I answered, “The Mayo Clinic.”

Mayo isn’t in any of our geographic service areas, so the reporter thought that was a surprising answer. So why did I pick Mayo?

When I look at the caregivers of America, Mayo stands out as an organization that is absolutely committed to medical excellence. I know Mayo well. Mayo puts the patient first all of the time. That is the secret to their success – being extremely patient focused. They also do a great job on research, teaching, and health policy leadership – and they, like us, have very carefully structured themselves internally to eliminate the potentially perverse financial incentives that are far too often an unintended but very real result of using fee-for-service mechanisms to set take-home pay for caregivers.

Mayo is well organized, very strategic, passionate about their ethical and medical standards, and extremely competent. So when I think of which competitors I most respect, Mayo comes to mind immediately.

We are on those same pathways. Mayo was a couple of years ahead of us in the incredibly important work of bringing electronic medical records and electronic support tools to health care, but I believe we are nearly caught up, and I expect us to pass them in the total capabilities of our system by mid-2009. We are on a pathway to be a world leader in use of our computers to support both health care and medical research. We are putting electronic support tools in place that will allow our brightest and best caregivers working in highly focused teams to re-engineer care – to bring health care into the universe of computer supported professions.

We are doing a lot of things right. We are actively promoting universal coverage. We are very much a leader in promoting both quality improvement and health status improvement. We are winning awards both for our own internal diversity and for our focus on helping America as a nation end ethnic disparities in care. We are rebuilding our infrastructure and our people are learning new skills that will allow us to become a national leader in capturing accurate data, and billing accurately, as well as a leader in health care-related SOX (Sarbanes-Oxley) compliance. “SOX” is an important new way of making absolutely sure that we get all of our numbers right. It’s a new set of reporting requirements. Look at our Web site (http://kpnet.kp.org/sox/) for more information about SOX. We need to be not only technically “SOX compliant” but functionally “SOX excellent.”

We are just now learning to use unit-based teams to achieve excellence in performance in multiple areas. This is very important work. Extremely important work. It is one of the best and most important features of our pioneering Labor Management Partnership. Unit-based teams will let us achieve performance in a wide array of functions, areas, and operations in our caregiving activities.

We are also enhancing call centers, improving claims processes, and embedding “compliance” in our daily work flow. My request to our compliance staff four years ago was to “bake it in” so that we never have to face any of the compliance messes that so many other caregiving institutions have faced. As we are building our new systems, our compliance folks are at the table making sure we don’t have to go back and do major rework to “get it right later.”

We are on a learning curve in multiple areas across our organization. We are facing the exhilaration, excitement and worries of just starting up some learning curves, and we are facing the satisfaction and sense of accomplishment that comes from having climbed the learning curve in other areas and being a leader in health care and health improvement.

If you think about your own work area, I suspect you can think of direct examples where we are on either end of an important learning curve.

Sometimes we make mistakes. When we do, we need to acknowledge the mistakes and take corrective action to reduce or eliminate the likelihood of repeating future errors. We provided charity care to 256,000 patients last year. We are proud of that achievement. We have enrolled more than 72,000 low-income people in our special dues subsidy programs – with many of the dues subsidized to the point of being free. Those are programs that we celebrate – and intend to expand.

Sometimes we make mistakes. As an organization of caregivers, we all feel collective pain any time we mis-deliver care. We did not choose to be part of a caregiving community to mis-deliver care.

We have, in total, more than 40 million in-person patient encounters each year. Our caregivers serve more people than the entire population of 136 countries. With that volume, we will have some errors. No one can be perfect 40 million times. We will have some cases that we would very much like to “do over.” When, despite our best intentions, an error or mistake negatively impacts a patient or a patient’s family, we feel tremendous pain. We need to learn from each mistake. We need to figure out what went wrong – and then we need to carefully re-engineer what we do to minimize or eliminate the likelihood that we will make that same error again.

We can’t be perfect 40 million times – but we can set that as our goal. We are moving toward the best scores in the country in areas like hospital infection rates, heart attack prevention rates, and breast cancer detection rates. Excellence needs to be our goal, excellence in multiple areas. We also need to be an organization of caregivers committed to continuous learning. In today’s rapidly changing health care world, anything less than continuous learning would be a mistake. Becoming the best in America at continuous learning is an achievable goal for us. It's exciting and it is very much the right thing to do.

I have just finished my fifth year at Kaiser Permanente. I started to write this letter as a reflection on those five years. I continue to believe that Kaiser Permanente is a great place to be and that this is a great time to be here. And that is how I answer the question when people external to us ask me “What is Kaiser Permanente?” I tell them we are a community of caregivers – a group of people who first made the life choice to do good – to “make lives better” – and then made the career choice to do that good here. We need to celebrate and mutually reinforce the collective good that we all do.

We are actually doing many very good things that we do not celebrate among ourselves or with those we serve. For the next year, every week, on my Web site (http://insidekp.kp.org/insidekp/communicate/CEOhome/new_site), I am going to celebrate a different thing we have done really well somewhere in our organization. Last year, in various publications across the country, there were more than 5,000 positive newspaper articles and media stories that made positive references to us or that focused on specific things we did well. (A list of some of those stories is on our Web site – http://www.kp.org/newscenter.) People in the outside world read those individual positive stories about us in various local settings, but we did not share them with each other. It’s time to do some sharing with each other. We do not have a shortage of accomplishments to celebrate. We also don’t have a shortage of positive initiatives to talk about. Let me know if you have particular accomplishments that you believe we should be celebrating with each other.

I would love to hear from you. How are you doing? How are we all doing? Change can be stressful. We are, as you know, in the middle of much change both across the organization and in various work units. Keep in mind that when it’s well done, the results and rewards of well planned, well structured, well focused change can be excellent. And the result can be excellence. Excellence is a great goal to have.

Be well. And let me hear from you.

George