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Ken Kizer’s Bigelow Lecture


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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.

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.]


[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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