This article, first published by in July 2016 by hfma, outlines how hospitals can get physicians to understand the financial impact of their clinical decisions and become actively engaged in improving the value of care. Texas Children’s Hospital was successful through recognizing the need for cultural transformation and ensuring quality came first. The organization engaged clinicians with financial data, including educating them on key financial principles, linking quality improvement training with financial accountability, and accompanying financial choices with clinical choices.

1. Engaging Physicians to Be
Good Financial Stewards ̶ Dr. Bryan Oshiro
Dr. Charles Macias

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Engaging Physicians in Financial Stewardship
Getting physicians to become actively
engaged in improving value is a critical
concern for the nation’s hospitals.
Physicians becoming willing to share in the
responsibility for the financial implications
of their clinical decisions is necessary to
ensure a hospital’s future survival.
Each success story, therefore, serves as a
beacon to guide the efforts of organizations
that are still finding their way.
Editor’s note: Originally appeared in the July 2016 HFM Magazine

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Engaging Physicians in Financial Stewardship
For Texas Children’s Hospital (TCH) in
Houston, efforts to engage physicians in the
pursuit of value have led to a profound
cultural change, in which physicians,
administrators, and the finance team are
now working collaboratively to facilitate a
joint vision and mission for delivering
affordable high-quality care.
This is the story of how TCH integrated
financial considerations into its physician
culture with measurable success, and of the
lessons learned along the way.

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The Need for a Paradigm Shift
Physicians always have focused on being
good stewards of patient health. Delivering
high-quality care is and has been their
mission, as it should always be.
However, in the current climate of
skyrocketing costs and declining payments,
a mission focused solely on quality of
clinical care isn’t enough.
A paradigm shift is required in which
physicians come to embrace the concept of
value in health care, with consideration of
both financial and clinical outcomes.

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Quality Comes First
Because many clinicians are as yet
unaccustomed to tracking the cost of
health care, applying financial metrics to
the services they deliver represents a sea
change for them.
One of the biggest cultural barriers
encountered at Texas Children’s was the
longstanding taboo in physician culture
regarding discussions of cost.
Administrators can help clinicians
understand that reduced cost is not
necessarily associated with lower quality.

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Quality Comes First
The first step leaders at TCH took toward
integrating finance into its physician
culture was to reassure physicians that
their motive was not to prioritize money
and profits over quality and patient safety.
To help allay clinicians’ concerns, Texas
Children’s leaders made it a point to
approach the question of cost through the
lens of the Institute of Medicine’s (IOM)
six domains of quality.

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Quality Comes First
IOM’s quality domains aim to create a healthcare
system that is:
• Safe
• Effective
• Patient-centered
• Timely
• Efficient
• Equitable
The domain most pertinent in the cost
discussion is efficiency. Cost reductions will
occur by improving patient care efficiency.

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Quality Comes First
It also is important to remain focused on
primary metrics related to patient-related
outcomes. The goal isn’t always to choose
the lowest-cost option.
This point is aptly illustrated by a best-
practice process Texas Children’s
implemented related to one of its initial
areas of focus for quality improvement:
Appendectomy Care

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Quality Comes First
A review of the clinical evidence clearly
showed that one of the more expensive
antibiotics for preoperative prophylaxis for
patients undergoing appendectomy also
produced the best outcomes.
The goal was set to increase the use of
that antibiotic, without other antibiotic
treatment, to account for 90 percent or
more of those circumstances.
Standardizing to use the costly antibiotic
resulted in fewer complications, decreased
length of stay, improved clinical outcomes
and generated cost savings.

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A Suggested Iterative Approach
Organizations seeking to engage physicians
with quality and cost data should plan on
allocating time and resources to creating the
infrastructure and processes required to
accomplish this objective.
Such an effort is likely to require new
technology systems, new workflows, and a
healthy dose of change management.
For purely practical purposes, organizations
should adopt an iterative approach to
building the requisite infrastructure.

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A Suggested Iterative Approach
Because all organizations have different
strengths and needs, no single iterative
approach will work for every organization.
The overall approach will be essentially the
same for most organizations because all
organizations must address certain
fundamental domains—such as gathering
data and implementing improvement projects.
But the approaches also will necessarily differ,
based on each organization’s readiness and
unique requirements, in the exact sequence of
the elements and interventions required.

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A Suggested Iterative Approach
The approach Texas Children’s used
involved several facets, which are
described in the following slides.
After board approval for a data and
quality plan, TCH assembled an
executive team to guide the
performance initiative with clinical,
operational, and finance leaders.

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A Suggested Iterative Approach
Establish analytics and transparency of data
To successfully transform its culture, Texas
Children’s required an integrated technology
infrastructure that would make good data
available to drive decision making.
As the foundation for this technology infra-
structure, Texas Children’s implemented an
electronic data warehouse (EDW) that
blends and delivers near-real-time financial,
operational, and clinical data for clinicians
and key stakeholders.

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A Suggested Iterative Approach
Study integrated data to identify opportunities
The aggregation of clinical and financial data
gave TCH leaders the means for pinpointing
clinical and operational processes where the
greatest opportunities for improvement lay.
That effort would require a partnership
among operations, finance, and clinical
domains looking at several types of waste to
identify quality and cost problems.
The analytical tools helps hospital leadership
understand the data and determine which
problems to tackle first.

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A Suggested Iterative Approach
Create multidisciplinary teams charged with identifying and
implementing improvements.
The task of ascertaining how best to improve
quality and cost was assigned to teams
composed of diverse stakeholders, including
clinicians, data analysts, electronic medical
record architects, finance, and operations.
By designing these teams to cross traditional
boundaries, Texas Children’s aimed to
promote collaboration between the clinicians
and the other key stakeholders.

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A Suggested Iterative Approach
The permanent, integrated teams would
combine their members’ expertise to identify
specific areas for care improvement and to
build evidence-based standards and best
practices into the care delivery workflow.
Teams would work with clinicians and staff on
the front lines of care to evaluate and develop
clinician training, nursing plans, electronic
health record tools, and patient education
materials, ensuring effective system-wide
implementation of best practices.
Create multidisciplinary teams charged with identifying and
implementing improvements.

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A Suggested Iterative Approach
Fine-tune the analytics approach
As finance leaders and staff became more
adept at working with the data in the hospital’s
EDW, they became more sophisticated in their
ability to pinpoint—and even predict—
opportunities for cost reduction.
Working with the finance department, the team
also undertook an ongoing analysis to predict
the likely impact of changing payment models
on Texas Children’s bottom line and to
determine how the organization could best
respond to achieve financial success.

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A Suggested Iterative Approach
Engage clinicians with financial data
Once the quality improvement teams could
demonstrate improvements in clinical
outcomes, the teams were then engaged
with more robust financial data—a process
that is described below in more detail.
Establishing clinician buy-in for new best-
practice processes, team structures, and
quality dashboards required immense
cultural change and served as an
important precursor to engaging
clinicians with financial data.

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Lessons Learned: Physicians and Financial Data
Integrating financial data into the clinician-
facing dashboards and exposing it to
frontline staff also was an iterative process
that required—and continues to require—
frequent refinement.
Here are some of the key strategies that
have helped Texas Children’s—within its
team-based approach—engage the
organization effectively with financial data.

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Lessons Learned: Physicians and Financial Data
Educating physicians on key financial principles
Unless they are running their own office
practice or group practice, many physicians
aren’t trained to understand the business of
health care, so educating them about
healthcare finance is key.
TCH offers a Finance 101 course to
physicians who have leadership roles in
quality improvement. The 12-month
curriculum consists of an in-depth but a
straightforward explanation of concepts
such as margin and variable direct cost.

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Lessons Learned: Physicians and Financial Data
Educating physicians on key financial principles
The course also explains current value-based
care payment issues and their financial
implications.
This basic educational foundation helps
clinician leaders better interpret combined
clinical and financial data, and links advanced
quality improvement training with elements of
financial accountability.
Texas Children’s has systematized training in
quality improvement, including integrating
finance into the improvement process.

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Lessons Learned: Physicians and Financial Data
Accompanying financial choices with clinical choices
Most clinicians are unaccustomed to seeing
financial analytics integrated directly into their
dashboards, and the clinicians at Texas Children’s
were no exception.
Today these clinicians have a range of information
available that they had been unaccustomed to
seeing, such as test ordering utilization and
guidelines compliance rates, length of stay,
variable direct cost, comparative costs of
different procedures, and other relevant metrics.

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Lessons Learned: Physicians and Financial Data
Accompanying financial choices with clinical choices
Even with this information at hand and an
organizational culture in which clinicians are
beginning to embrace cost data, Texas Children’s
clinicians are understandably unwilling to make
decisions based on cost alone.
Cost of care summaries can be provided to the
clinicians to help them understand the bigger
picture for the cost of delivering care to
populations of children with specific diseases.

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Lessons Learned: Physicians and Financial Data
Using data to prove outcomes are not sacrificed
The ultimate aim of any improvement effort is to
improve outcomes of care for the patient. It is
important to use data to back up that claim—
especially when working with physicians.
One area where such use of data has been
important at Texas Children’s is in encouraging
clinicians to use the lowest-cost resource
appropriate to produce the desired outcomes.
For example ancillary staff can be effective in
educating patients and in helping patients
navigate the care process for specific diseases.

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Lessons Learned: Physicians and Financial Data
Using data to prove outcomes are not sacrificed
By sharing data with clinicians that show how and
where staff can deliver outcomes equal to those
delivered by more highly trained clinical staff.
It is possible to persuade physicians and
nurses that they needn’t bear the entire
burden of improvement, but would better
serve their patients by focusing their clinical
skill where it is most needed and delegating
other tasks to more appropriate resources.

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Lessons Learned: Physicians and Financial Data
Integrating finance more fully into the governance structure
Establishing a robust data governance was
critical to integrating the operational and
financial components into all of Texas
Children’s improvement efforts.
From the beginning, clinical, operational,
and financial decision makers were included
in the governance structure; however, the
role of finance has increased significantly
over time.

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Lessons Learned: Physicians and Financial Data
Integrating finance more fully into the governance structure
In the beginning, finance from to time to time
was asked to help out on specific projects.
Now finance leaders and executives are on
the governance of TCH’s Clinical Systems
Integration Committee and assist in its data
analytics, evidence based practice, and
multi-disciplinary improvement teams.
Finance is very engaged in all of the
organization’s improvement conversations,
because payment strategies have a huge
impact on what TCH does.

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The Need for a Committed Partnership
As Texas Children Hospital builds financial
metrics into its clinical improvement strategies,
its executive leaders continue to emphasize to
its clinicians that changing the culture of care to
acknowledge the cost implications of clinician
decisions is both good and necessary.
This is a message directed at improving value.
Health care cannot be transformed successfully
without operations, finance, and clinicians
equally engaged and sitting side by side.

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For more information:
“This book is a fantastic piece of work”
– Robert Lindeman MD, FAAP, Chief Physician Quality Officer

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More about this topic
Link to original article for a more in-depth discussion.
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Jane Felmlee, Finance Operations Consultant

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Bryan Oshiro, MD joined Health Catalyst in January 2014 as the Medical Director. He received his
medical degree and completed his residency in Obstetrics and Gynecology at Loma Linda University
School of Medicine and completed his fellowship in Maternal-Fetal Medicine at the University of Texas
in Houston before moving to Salt Lake City to join Intermountain Health Care and served as the
Medical Director of the Women and Newborn Service line. He also was a member of the department of
Obstetrics and Gynecology at the University of Utah.
He then joined Loma Linda University where he became the division director of Maternal-Fetal Medicine and the
vice-chairman for the department of Obstetrics and Gynecology. He co-chairs the American College of Obstetricians
and Gynecologists Patient Safety Committee for District IX and received the Elaine Whitelaw Service Award from
the March of Dimes for his work on a 5 state initiative to eliminate elective deliveries less than 39 weeks gestation.
Other Clinical Quality Improvement Resources
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Dr. Macias has had a long-time interest in health services research with a focus in asthma. He has
developed a niche in the Emergency Department role in pediatric asthma management. His
research interests have also led to publications on the acute use of steroids, the acute use of novel
therapies, the role of emergency department (ED) surveillance in pediatric asthma, and the role of
educational interventions in pediatric asthma. He conducts statewide surveillance of pediatric
emergency department asthma, helping to coordinate the efforts of several governmental and educational
organizations. He is on the board of directors of the Asthma Coalition of Texas, has served on its Epidemiology
Committee, and has participated in the development of an Asthma Plan for Texas. He is also a member of the Gulf
Coast Asthma Coalition. He was the primary investigator of the Texas Emergency Department Asthma Surveillance
Project, funded by the American Academy of Asthma Allergy and Immunology as well as the Robert Wood Johnson
Foundation, and has continued work in this arena. He serves as the Chairman of the Asthma Center of Excellence
at Texas Children’s Hospital. He is also the Director of Evidenced-Based Outcomes Center at Texas Children’s
Hospital and is involved in quality improvement research and leads a number of initiatives to evaluate the impact of
various guideline development protocols throughout the TCH IDS.
Other Clinical Quality Improvement Resources
Click to read additional information at www.healthcatalyst.com