Stefan Larsson: What doctors can learn from each other

Five years ago, I was on a sabbatical,

and I returned to the medical university

where I studied.

I saw real patients and I wore the white coat

for the first time in 17 years,

in fact since I became a management consultant.

There were two things that surprised me

during the month I spent.

The first one was that the common theme

of the discussions we had were hospital budgets

and cost-cutting,

and the second thing, which really bothered me,

actually, was that several of the colleagues I met,

former friends from medical school,

who I knew to be some of the smartest,

most motivated, engaged and passionate people

I'd ever met,

many of them had turned cynical, disengaged,

or had distanced themselves from hospital management.

So with this focus on cost-cutting,

I asked myself, are we forgetting the patient?

Many countries that you represent

and where I come from

struggle with the cost of healthcare.

It's a big part of the national budgets.

And many different reforms aim at holding back this growth.

In some countries, we have long waiting times

for patients for surgery.

In other countries, new drugs are not being reimbursed,

and therefore don't reach patients.

In several countries, doctors and nurses

are the targets, to some extent, for the governments.

After all, the costly decisions in health care

are taken by doctors and nurses.

You choose an expensive lab test,

you choose to operate on an old and frail patient.

So, by limiting the degrees of freedom of physicians,

this is a way to hold costs down.

And ultimately, some physicians will say today

that they don't have the full liberty

to make the choices they think are right for their patients.

So no wonder that some of my old colleagues

are frustrated.

At BCG, we looked at this,

and we asked ourselves,

this can't be the right way of managing healthcare.

And so we took a step back and we said,

"What is it that we are trying to achieve?"

Ultimately, in the healthcare system,

we're aiming at improving health for the patients,

and we need to do so at a limited,

or affordable, cost.

We call this value-based healthcare.

On the screen behind me, you see what we mean

by value:

outcomes that matter to patients

relative to the money we spend.

This was described beautifully in a book in 2006

by Michael Porter and Elizabeth Teisberg.

On this picture, you have my father-in-law

surrounded by his three beautiful daughters.

When we started doing our research at BCG,

we decided not to look so much at the costs,

but to look at the quality instead,

and in the research, one of the things

that fascinated us was the variation we saw.

You compare hospitals in a country,

you'll find some that are extremely good,

but you'll find a large number that are vastly much worse.

The differences were dramatic.

Erik, my father-in-law,

he suffers from prostate cancer,

and he probably needs surgery.

Now living in Europe, he can choose to go to Germany

that has a well-reputed healthcare system.

If he goes there and goes to the average hospital,

he will have the risk of becoming incontinent

by about 50 percent,

so he would have to start wearing diapers again.

You flip a coin. Fifty percent risk. That's quite a lot.

If he instead would go to Hamburg,

and to a clinic called the Martini-Klinik,

the risk would be only one in 20.

Either you a flip a coin,

or you have a one in 20 risk.

That's a huge difference, a seven-fold difference.

When we look at many hospitals

for many different diseases,

we see these huge differences.

But you and I don't know. We don't have the data.

And often, the data actually doesn't exist.

Nobody knows.

So going the hospital is a lottery.

Now, it doesn't have to be that way. There is hope.

In the late '70s, there were a group

of Swedish orthopedic surgeons

who met at their annual meeting,

and they were discussing the different procedures

they used to operate hip surgery.

To the left of this slide, you see a variety

of metal pieces, artificial hips that you would use

for somebody who needs a new hip.

They all realized they had their individual way of operating.

They all argued that, "My technique is the best,"

but none of them actually knew, and they admitted that.

So they said, "We probably need to measure quality

so we know and can learn from what's best."

So they in fact spent two years debating,

"So what is quality in hip surgery?"

"Oh, we should measure this." "No, we should measure that."

And they finally agreed.

And once they had agreed, they started measuring,

and started sharing the data.

Very quickly, they found that if you put cement

in the bone of the patient

before you put the metal shaft in,

it actually lasted a lot longer,

and most patients would never have to be

re-operated on in their lifetime.

They published the data,

and it actually transformed clinical practice in the country.

Everybody saw this makes a lot of sense.

Since then, they publish every year.

Once a year, they publish the league table:

who's best, who's at the bottom?

And they visit each other to try to learn,

so a continuous cycle of improvement.

For many years, Swedish hip surgeons

had the best results in the world,

at least for those who actually were measuring,

and many were not.

Now I found this principle really exciting.

So the physicians get together,

they agree on what quality is,

they start measuring, they share the data,

they find who's best, and they learn from it.

Continuous improvement.

Now, that's not the only exciting part.

That's exciting in itself.

But if you bring back the cost side of the equation,

and look at that,

it turns out, those who have focused on quality,

they actually also have the lowest costs,

although that's not been the purpose in the first place.

So if you look at the hip surgery story again,

there was a study done a couple years ago

where they compared the U.S. and Sweden.

They looked at how many patients have needed

to be re-operated on seven years after the first surgery.

In the United States, the number was three times

higher than in Sweden.

So many unnecessary surgeries,

and so much unnecessary suffering

for all the patients who were operated on

in that seven year period.

Now, you can imagine how much savings

there would be for society.

We did a study where we looked at OECD data.

OECD does, every so often,

look at quality of care

where they can find the data across the member countries.

The United States has, for many diseases,

actually a quality which is below the average

in OECD.

Now, if the American healthcare system

would focus a lot more on measuring quality,

and raise quality just to the level of average OECD,

it would save the American people

500 billion U.S. dollars a year.

That's 20 percent of the budget,

of the healthcare budget of the country.

Now you may say that these numbers

are fantastic, and it's all logical,

but is it possible?

This would be a paradigm shift in healthcare,

and I would argue that not only can it be done,

but it has to be done.

The agents of change are the doctors and nurses

in the healthcare system.

In my practice as a consultant,

I meet probably a hundred or more than a hundred

doctors and nurses and other hospital

or healthcare staff every year.

The one thing they have in common is

they really care about what they achieve

in terms of quality for their patients.

Physicians are, like most of you in the audience,

very competitive.

They were always best in class.

We were always best in class.

And if somebody can show them that the result

they perform for their patients

is no better than what others do,

they will do whatever it takes to improve.

But most of them don't know.

But physicians have another characteristic.

They actually thrive from peer recognition.

If a cardiologist calls another cardiologist

in a competing hospital

and discusses why that other hospital

has so much better results, they will share.

They will share the information on how to improve.

So it is, by measuring and creating transparency,

you get a cycle of continuous improvement,

which is what this slide shows.

Now, you may say this is a nice idea,

but this isn't only an idea.

This is happening in reality.

We're creating a global community,

and a large global community,

where we'll be able to measure and compare

what we achieve.

Together with two academic institutions,

Michael Porter at Harvard Business School,

and the Karolinska Institute in Sweden,

BCG has formed something we call ICHOM.

You may think that's a sneeze,

but it's not a sneeze, it's an acronym.

It stands for the International Consortium

for Health Outcome Measurement.

We're bringing together leading physicians

and patients to discuss, disease by disease,

what is really quality,

what should we measure,

and to make those standards global.

They've worked -- four working groups have worked

during the past year:

cataracts, back pain,

coronary artery disease, which is, for instance, heart attack,

and prostate cancer.

The four groups will publish their data

in November of this year.

That's the first time we'll be comparing

apples to apples, not only within a country,

but between countries.

Next year, we're planning to do eight diseases,

the year after, 16.

In three years' time, we plan to have covered

40 percent of the disease burden.

Compare apples to apples. Who's better?

Why is that?

Five months ago,

I led a workshop at the largest university hospital

in Northern Europe.

They have a new CEO, and she has a vision:

I want to manage my big institution much more

on quality, outcomes that matter to patients.

This particular day, we sat in a workshop

together with physicians, nurses and other staff,

discussing leukemia in children.

The group discussed,

how do we measure quality today?

Can we measure it better than we do?

We discussed, how do we treat these kids,

what are important improvements?

And we discussed what are the costs for these patients,

can we do treatment more efficiently?

There was an enormous energy in the room.

There were so many ideas, so much enthusiasm.

At the end of the meeting,

the chairman of the department, he stood up.

He looked over the group and he said --

first he raised his hand, I forgot that --

he raised his hand, clenched his fist,

and then he said to the group, "Thank you.

Thank you. Today, we're finally discussing

what this hospital does the right way."

By measuring value in healthcare,

that is not only costs

but outcomes that matter to patients,

we will make staff in hospitals

and elsewhere in the healthcare system

not a problem but an important part of the solution.

I believe measuring value in healthcare

will bring about a revolution,

and I'm convinced that the founder

of modern medicine, the Greek Hippocrates,

who always put the patient at the center,

he would smile in his grave.

Thank you.

(Applause)