Ken Kizer’s Bigelow Lecture
ACHIEVING CHANGE IN COMPLEX SYSTEMS
From left to right: Pixie Bigelow Currie, Ken Kizer, Ann Knight, Gail
MacNaughton, Ian Currie, and Chris Caldarone
When Kenneth W. Kizer was asked to take over as the
chief executive of the Department of Veterans Affairs
(VA) healthcare system in 1994, “it was a hide-bound,
sclerotic and highly dysfunctional system.” Over the
next 5 years he led a near miraculous transformation
of VA healthcare, achieving what is widely regarded as
the largest and most successful healthcare turnaround in
U.S. history. Ken, a former U.S. Navy diver and medical
officer who worked with explosive ordnance disposal
units when he was in the military, gave the 2013 Bigelow
Lecture, celebrating the memory of Wilfred Bigelow, our
distinguished former Chair of Cardiac Surgery (see 2011 article).
Ken, who is board certified in 6 medical specialties or
subspecialties, has had a very diverse career that includes
being the Director of the California Department of
Health Services and the state’s top health official for nearly
7 years, founding president and CEO of the National
Quality Forum, chairman and CEO of a leading open
source electronic health records company, a consultant
to numerous foreign countries, and one of only about
a dozen persons ever elected to both the Institute of
Medicine of the National Academy of Sciences and the
National Academy of Public Administration. Currently,
he is a Distinguished Professor at the University of
California, Davis, and serves as Director of the Institute
for Population Health Improvement, UC Davis Health
System. When he started the Institute two years ago,
he was the only full time equivalent employee. Since
then, he has brought in nearly $70 million in grants and
contracts, and the Institute now has some 115 staff. He
works actively with Medi-Cal, the California Medicaid
Program (the largest in the U.S. with an annual budget
of more than 60 billion dollars), manages the California
Cancer Registry for the Department of Public Health,
and has a lead role in catalyzing the development of
Health Information Exchange technology in the state,
among more than 20 other funded projects. A thoughtful
critic of the healthcare system in the United States,
he described it as “unsustainably costly, with widespread
quality gaps, uneven access, great inefficiency, and
marked overuse of specialists, with overall population
health stagnant or declining.”
In his Bigelow Lecture, Ken talked about achieving
change in complex systems. He noted that while change
is inherent to living, it is usually discomforting and often
not embraced. “It’s hard work, and though change strategies
are usually conceptually straightforward, change
almost always is hard to achieve and takes longer than
expected – consider the adoption of electronic health
records as one example.” Citing weight loss as a common
example of the difficulty in achieving change, he
quipped that he, like many people, “uses the rhythm
method of girth control.” He added, “Even though
losing weight is conceptually simple - if you eat less
and exercise more, you can’t help but lose weight - it
is often very hard to actually do it.” To highlight how
strong resistance to change can be, he cited the current
situation in Washington, D.C. A small number of congressmen
forced the shutdown of the US government to
prevent implementation of healthcare reform legislation.
“Resisting change is easier than effecting change. Among
the prominent reasons that change efforts so often fail
are: the cause of the problem or need for change is not
correctly diagnosed, there is no shared vision of the
new future, change strategies are not aligned with reality,
poor communication, failure to align incentives for
change, failure to effectively implement the change strategies
and tactics, and failure to anticipate unintended
consequences.
“Complex adaptive systems, unlike traditional manufacturing
systems, are non-linear, dynamic and do not
inherently reach equilibrium points. Complex systems
are made up of independent agents who often have competing
interests, which can lead to conflicting behaviors.
And these independent agents are intelligent and
quickly learn to ‘game’ the system for their advantage.
Likewise, in complex systems there is no single point
of control; no one is truly in charge. Core concepts for
successfully changing complex systems include creating a
shared vision of a new normal and making small changes
in critical ‘change levers’, the effects of which will then
reverberate throughout the system. Change strategies
and tactics should overlap and reinforce each other, and
it is critical to be vigilant for unintended consequences,
which always occur when changing complex systems.
Critical change levers in healthcare today include payment,
performance measurement and reporting, information
technology, patient engagement, and regulation
- both implementing regulations and providing regulatory
relief.”
As an example of achieving change in a complex system,
Ken briefly described the famed California Tobacco
Control Program which he helped engineer in the late
1980s. “Proposition 99 -- a citizen-launched public initiative
to increase the tax on cigarettes that was proposed
after years of inaction by the California Legislature --
added a tax of 25¢ per pack to the cost of cigarettes. The
campaign to defeat the initiative markedly outspent its
proponents, with most of that money coming from the
tobacco industry. After Proposition 99 was passed by the
voters, the Tobacco Control Program sought to deglamorize
smoking by characterizing it as ‘dirty, dumb, and
dangerous’ in paid media advertising, in film, print and
other venues. Other efforts to create a new normal with
regard to smoking included making it less convenient to
smoke by banning smoking in public places (e.g., restaurants,
theatres, and bars). Making it more expensive
was especially important in discouraging teenagers from
taking up the habit. Other elements of the campaign
included establishing ‘quit lines’ to assist people to quit
smoking, and raising awareness of the dangers of secondhand
smoke. California has led the U.S. in the rate
of decline of smoking.” He illustrated this with a graph
showing smoking in the population falling from 22% in
1989 to under 12% in 2010. Highlighting the types of
paid advertizing made possible by the increased tobacco
tax, he showed several television spots, including one of
an MTV band in which a rapper and dancers talk about
teenagers ‘jokin’ and smokin’ and going six feet down’.
A recently published study showed that the return on
investment for the $2.4 billion spent of the Tobacco
Control Program was $134 billion in savings in healthcare
costs for smoking-related disease.
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As another example of achieving change in complex
systems, Ken highlighted the transformation of the VA
healthcare system that he engineered in the late 1990s.
“The VA manages the largest healthcare system in the
United States, though available only to eligible veterans.
It currently has an annual budget of over $50 billion and
more than 1500 healthcare facilities, located in every
state and territory of the United States. VA patients are
generally older, sicker, poorer, less well educated, and
have more complex problems than the general patient
population. Some 35% of VA patients have one or more
mental health diagnoses in addition to their physical illnesses.
85% of the hospitals in the system are teaching
hospitals, and VA provides training for more than 45
types of healthcare professionals every year. VA also has
a large research program, having some 2 billion dollars
of funded projects each year.
“When President Bill Clinton asked us to re-engineer
the VA healthcare system in 1994, everyone was dissatisfied
with it. Service delivery too often was indifferent and
insensitive. Quality of care was irregular and unpredictable.
VA’s culture was punitive and highly risk adverse.
Leadership changed frequently, and the governing board
was the US Congress, which often had conflicting ideas
about what the system should do - or whether it should
even exist! While essentially everyone agreed on the need
to fix VA healthcare, there was no agreement on how to
do so. We developed a 5-pronged change strategy aimed
at: 1) increasing accountability, 2) integrating and coordinating
care, 3) improving and standardizing superior
quality, 4) modernizing information management, and
5) aligning finances with desired outcomes.”
During the 5 years Ken was at the helm of VA healthcare,
he closed 29,000 hospital beds (55% of all beds),
and decreased overall staffing by 26,000 positions while
adding more caregivers. Admissions dropped by more
than 350,000 per year; almost 2,800 forms (72% of
all) were eliminated; per patient annual cost of care
decreased by over 25%; patient satisfaction rose to the
point that 80% said that the VA system was better; a
system-wide electronic health record was implemented;
and there was much greater use of evidence-based care
(e.g. post- myocardial infarction drug treatment). As a
public system, one of the dynamics that helped support
change was that any money saved was reinvested in making
the system better. In 2006, BusinessWeek ran a feature
article about VA’s turnaround, calling VA healthcare
the ‘Best Care in the U.S’. "
In describing the “5 Es” for successfully changing
complex systems, Ken listed: 1) Envision and embrace
a new normal; 2) Enlist champions, partners and collaborators;
3) Engineer and execute a multi-dimensional
change strategy employing critical change levers that
produce overlapping and mutually reinforcing effects; 4)
Enable and empower agents of change; and 5) Evaluate
whether change is actually occurring and what strategies
and tactics are most effective.
In the question period, Chris Caldarone said: “You
mentioned pushing decision –making down to the lowest
level. Wasn’t this pushing it down into a hide- bound
and sclerotic system?” Ken replied, “Whenever possible
the decision –making was pushed down to accountable
people on the front line who knew best what needed to
be done.” Tom Waddell asked about the use of competition:
“the rap on the Canadian system is that it is a
single payer behemoth, like the VA, versus the United
States which is very differentiated and has a high level of
competition and innovation.” Ken responded by saying
that, “Transparency is key to competition. In the VA,
everyone in the system could see who were the winners
and who was doing the best. That made everyone compete
to improve - to catch up with the best performers.”
Jim Wright asked about patient-centered effectiveness
research. Ken said, “While there is a lot of activity in
the US at the moment, it’s not clear if there is a coherent
plan.” Andy Smith asked how to train residents to
do the kind of work that Ken has done. Ken reported
that he recently reviewed the strategic plan for a very
well-known medical school that is initiating a new curriculum
on billing and office management, but does not
include any plans for curricula on quality improvement,
change management, or how to use big data. He questioned
how ready the trainees will be for the new valuebased
healthcare delivery models that are quickly becoming
the new normal in healthcare payment. Finally, the
question was asked about paying doctors, and he said
that “global payment” is inevitable in the U.S. “Global
payment systems incentivize providing high quality care
in the right amount at the right time and right place, in
contrast to fee for service that rewards providing an ever
greater volume of services. He added, “One thing that
helps the VA healthcare system in this regard is that the
patients generally are there for life, so there is a built-in
incentive to provide the care that is needed, not too
much or too little.” [Please see the Editor’s column on page
12 and commentary on page 14 for an update on the current
problems of the VA Health Care System. Ed.]
M.M.
[In a subsequent conversation, Jim Wright pointed out to me that
the alternate funding plan is working, because it aligns incentives
of the staff with the incentives and goals of the institutions. It’s
much like residency. The primary rewards are collegiality, challenging
cases, and a noble goal, rather than individual reimbursement.
Ed.]
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