Theory of Constraints Handbook - James Cox Iii [617]
Copyright © 2010 by Julie Wright.
Why Change
Why Healthcare Systems Need to Improve
If you look hard enough, it is possible to find large-scale healthcare organizations in almost every shape, size, and form imaginable. To be considered a large-scale healthcare provider, an organization should be able to treat a wide spectrum of human conditions ranging between prevention, disease, and accidental trauma and almost all conditions in-between. Some patients’ conditions need immediate urgent care, others longer term treatments. Some systems may also provide additional specialist services from assisted conception to palliative care and from rectifying congenital defects to, perhaps, the genetic engineering of zygotes.
The locations for the delivery of care can vary widely as well; from urban based, high-tech, tertiary, multispecialist facilities to rural lone practitioner family physicians, they all contribute to the larger scale healthcare systems that we will all find ourselves entering and using during our lives.
Some hospitals have Emergency Rooms (ERs) and some do not. They come in different sizes to suit the needs of the population being served; and some are even licensed to perform different functions for different levels of trauma. Some Emergency Rooms are the front door to the only healthcare facility for miles around and in others the local physician is the Emergency Room surgeon and general practitioner. In some, the general practitioner is the gate-keeper to the hospital’s services even though they do not practice there.
There are facilities that focus on providing care for a very narrow range of conditions, such as standalone diagnostic centers and clinics that provide services for non-life threatening, elective surgery.
Around the perimeters, the large-scale healthcare organizations are providers of alternative therapies, some of which are gaining credibility and are being absorbed into the practice of scientific based Western medicine.
A large-scale healthcare organization can be a huge group comprised of hospitals, clinics, pharmacies, transport services, nursing homes, rehab facilities, and diagnostic centers, with large administrative offices that are remote from clinical areas, and some have international operations that are unbounded by international borders or politics. Alternatively, they can be a loose association of any type of clinic or surgery bound by a cooperative willing to support each other and their patients.
They can be not-for-profits organizations run by governments such as military services, charitable bodies, or socialized medicine, or as profit-oriented businesses, or as a variation of every shade of business model between the two ends of the spectrum. Blends of for-profit and not-for-profit can exist and function side by side within a large-scale healthcare organization.
These organizations can have another dimension—some are religious and others are secular; many have educational affiliations, as in teaching hospitals attached to medical schools, or are entirely privately owned and operated.
Whatever mix of services and provisions an individual healthcare service system possesses they all have a common need, that of being able to generate or acquire sufficient cash to operate. Even highly motivated not-for-profit providers have no mission if they do not have an operating margin. For-profit and not-for-profit organizations cannot operate at a financial loss no matter what their source of income: fees, donations, endowments, etc. In many countries, not-for-profit organizations qualify for favorable tax breaks. The other main difference between for-profit and not-for-profit operations is that the profit generated by not-for-profits is not paid out to shareholders as a dividend, as for-profits