“Every system is perfectly designed to get the results it gets” – Paul Batalden, MD
Hospitals are expected to deliver value in a variety of ways, including: 1) diagnosing and treating human disease, 2) educating practitioners, and 3) contributing to medical research. However, the first way of delivering value, often understood to be the primary purpose of hospitals—that of diagnosing and treating patients—is actually two business models grouped within the same operating unit.1,4 If hospitals hope to be excellent in both diagnosing and treating patients, they must deconstruct these fundamentally different business models and match them with their own appropriate operating models.1
One such hospital in Ontario, the Shouldice Hospital, has been particularly successful in aligning its business and operating models to treat hernias.2,3 External abdominal hernias are protrusions of bowel through the abdominal wall due to weakening of abdominal wall tissues. The Shouldice Hospital’s mission is to be the world leader specifically for repairing abdominal wall hernias.2
Shouldice’s operating model was designed very intentionally with the above business mission in mind. Both patient and clinician flow are standardized to maximize patient experience and outcomes, with complete process integration from pre-admission to patient discharge.1,3,5 Patients are diagnosed either in-person or remotely and arrive in the hospital the afternoon prior to surgery. Upon arrival, patients meet with a series of individuals for a physical exam, a lab check, and a discussion of administrative issues. At fixed times, they then undergo an orientation to set expectations and then meet with patients who previously underwent surgery in order to ask questions. On the day of the operation, patients are awoken at a standard time and prepared for surgery. There are 5 operating rooms, which each surgeon performing many hundreds of hernia surgeries each year, a much higher volume than in traditional hospitals. After the procedure, patients themselves walk to the post-op area, and over the coming 3 days they are encouraged to exercise, eat, and explore the hospital premises and meet friends. In total, whereas hernia procedures often take 90 minutes, cost $4,000, and result in a 5-10% complication rate in more traditional hospital setting, procedures at Shouldice often take 30-45 minutes, cost 30% less, and have a complication rate of .5%.1,3,5
These efficiencies can be largely attributed to an integrated process flow and standardization. Not only is patient flow standardized, so are clinical duties. Surgeons are scheduled for 3-4 operations in the morning and spend the afternoon seeing patients for the next day.1,3,5 Even the operation has been standardized to be almost robotic in fashion. Standardizing more mundane aspects of the procedure frees clinicians’ minds to focus on problem solving when the need arises, rather than having to think through routine best practices every time a procedure is done. Furthermore, when it comes to surgery, clinical experience is second to none on predicting success of outcomes. While all general surgeons nationwide are trained to perform hernia repairs, the experience and surgical volume of Shouldice surgeons is unprecedented.
Not only are processes and physician training aligned with the hospital’s mission, so is the hospital design itself. There are no televisions or phones in patient rooms, thus encouraging patient ambulation post-operatively, which has been shown to improve outcomes and decrease rates of deep vein thrombosis. 1,3,5 Many administrative staff members are cross-trained, allowing them to provide support to others when needed. 1,3,5 Even the compensation system, a salary system for the surgeons, helps align provider incentives to maximize patient care and not necessarily volume of procedures.
While Shouldice has made significant strides in aligning its operating and business models, it remains unclear whether such a standardized model of care delivery can be translated to other settings. Skeptics may argue that Shouldice patients are relatively healthy, not demanding care for a variety of medical comorbidities. However, certain centers, such as the Mayo Clinic, are already developing more specialized delivery models that focus on specific problem categories in an interdisciplinary fashion within the context of a larger medical center.6 Skeptics also question process standardization and loss of physician autonomy. While a standardized process may be less appropriate for diagnostic roles in healthcare, numerous examples, including adoption of checklists in operating rooms and the Narayana Health cardiac model in India, demonstrate upsides of standardization. Standardization affords clinicians the opportunity to not have to constantly think about more basic tasks, freeing their attention to more problem-solving, creative tasks.
- Christensen et. al. “Disrupting the Hospital Business Model” Forbes. 2009, Mar 31.
- Gawande, Atul. Complications: A Surgeon’s Notes on an Imperfect Science
- Bohmer, Richard. Designing Care: Aligning the Nature and Management of Health Care
- Heskett, James. “Shouldice Hospital Limited.” HBS Case. 2003, June 2.
- Morgenthaler, Timothy & Charler Harper. “Getting Ride of ‘Never Events’ in Hospitals.” Harvard Business Review. 2015, Oct 20.