Princess Health and EHR ED's in New South Wales. Will the Problems Magically "Disappear?" .Princessiccia

Princess Health and EHR ED's in New South Wales. Will the Problems Magically "Disappear?" .Princessiccia

healthcare IT defects healthcare IT difficulties Jon Patrick

Gusty 15:36 Add Comment

It occurs that one could look at Prof. Jon Patrick's recent health IT forensic analysis as a kind of "indictment" of the industry.

He can be seen as suggesting the industry needs to be "put on trial" (figuratively) regarding "crimes" (again, figuratively speaking) they've committed with regard to IT robustness and reliability. The latter translate directly to patient safety.

In a lawsuit such as a medical malpractice trial, obvious as well as potential evidence is put under "legal hold." For instance, if an EHR defect is suspected, metadata, audit trails, and patient data are asked (or should be asked) to be frozen or archived in the state they were in at the time of the alleged accident.

It can take a page or three (or more) of specifications simply to define what information, exactly, needs to be put on legal hold. My former staff were frequently required to place myriad materials on legal hold at Merck Research Labs, for example, baed on the lawsuit du jour.

Once frozen, discovery and forensic analysis of these now-static data can then proceed. In fact, cases can be lost on the basis of evidence of an archiving omissions, destruction or tampering when information holds are requested.

It occurs to me that Prof. Patrick has given the industry a detailed look into factors they could start to remediate, without publicity and without telling anyone. While this would be a net plus for patients, it might result in less of a learning experience to the industy than that industry needs, to motivate the industry to avoid future product engineering and quality issues and put quality (not simply margin) as priority #1.

I therefore would believe a "hold" put on the present state of these ED EMR systems, or a "snapshot" of their current state (i.e., an evaluation environment mirrored from the present operational one) would allow a careful evaluation of the impact of the issues noted in the study.

Such an evaluation would be far more difficult with a cybernetic moving target.

The "snapshot" idea would allow evaluation of system risk levels, intermittent "glitches", interference with workflows, etc. in a controlled testing environment, using mock data or data drawn from actual cases.

The "snapshot" approach would also allow incremental remediation of the "live" system that comes out of safe, controlled testing, rather than sticking with what exists now until the studies could be completed on the as-is system, and then applying all the fixes as one or more large "upgrades."

I, for one, would be interested in studying this "built by software professionals" system and comparing it to health IT systems we "academic nerds" were authoring, say, 10-15 years ago.

-- SS

Princess Health and Getting Out of Our RUC - "An Open Letter To Primary Care Physicians" .Princessiccia

Princess Health and Getting Out of Our RUC - "An Open Letter To Primary Care Physicians" .Princessiccia

anechoic effect Medicare perverse incentives reimbursement RUC

Gusty 13:17 Add Comment

Since 2007, we have been writing about the secretive RUC (RBRVS Update Committee), the private AMA committee that somehow has managed to get effective control over how Medicare pays physicians.  The RUC has been accused of setting up incentives that strongly favor invasive, high technology procedures while disfavoring primary care and other "cognitive medicine."  Despite the central role of (perverse) incentives in raising health care costs while limiting access and degrading quality, there has been surprisingly little discussion about the pivotal role played by the RUC. 

Now there is a movement afoot to replace the RUC.  In a new post on the Care and Cost blog, and the Replace the RUC site, Paul M. Fischer and Brian Klepper urged four approaches:

1. Make the public aware of the RUC�s role and urge the primary care societies to stop �enabling� the RUC through their participation.
2. Recruit experts who can credibly calculate the economic impacts of the RUC�s actions, and who can devise alternative payment methodologies.
3. Demonstrate the unlawfulness of CMS� (and HCFA�s) two-decades long reliance on the RUC.
4. Develop a collaboration between primary care and non-health care business.

They are also urging three specific actions:

1. Contact your primary care society to demand that they withdraw from the RUC.
2. Broaden awareness of what we�re doing and why by rebroadcasting to your primary care colleagues.
3. Get in touch to help us with resources, relationships or approaches that can strengthen this project.

They have set up an electronic petition that people can use to urge the three major medical societies that represent primary care physicians to quit the RUC.

On Health Care Renewal, we have been trying to make the systemic problems with with the leadership of health care organizations less anechoic in the hopes that greater realization that these problems exist would lead to actions to solve them. The regulatory capture by the RUC of Medicare's payment setting mechanism is one problem that really cries out for a solution. In 2007, I called for "an unbiased re-evaluation of the components of the RBRVS by people who are dedicated to doing it fairly, not benefiting one group of physicians, or the organizations that benefit from the increased use of procedures"; and "an unbiased investigation of what went awry with the process used by Medicare to determine physician payments."  Your heard it here first on Health Care Renewal.  It is nice to now have such distinguished company. 

I urge our readers to consider the actions urged above. 

True health care reform will require a transparent, honest, fair process for governments to decide on how they will pay for physicians' care and other health care services and goods. 

Princess Health and Dr. Scott Monteith on "The Best Compromise" on Physicians and Use of Troublesome Health IT .Princessiccia

Princess Health and Dr. Scott Monteith on "The Best Compromise" on Physicians and Use of Troublesome Health IT .Princessiccia

Dr. Scott Monteith Healthcare IT experiment

Gusty 09:17 Add Comment

I have posted two guest posts by Dr. Scott Monteith, a psychiatrist/informaticist, at the Jan. 2011 post "Interesting HIT Testimony to HHS Standards Committee, Jan. 11, 2011, by Dr. Monteith" and the Dec. 2010 post "Meaningful Use and the Devil in the Details: A Reader's View".

Here is another, with his permission. He is responding to a talking point from a health IT commentary website that was distributed among the AMIA evaluations special interest group readership.

Dr. Monteith asks some very probing questions. He writes:

I would like to respond to what I see as being one of the most important and challenging �real-life� issues confronting clinicians, and is captured in this excerpt [below, from the multi-vendor sponsored site HISTalk - ed.]:

HisTALK: ... Somewhere between �we vendors are doing the best we can given a fiercely competitive market, economic realities, and slow and often illogical provide procurement processes that don�t reflect what those providers claim they really want� and �we armchair quarterbacks critics think vendors are evil and the answer is free, open source applications written by non-experts willing to work for free under the direct supervision of the FDA� is the best compromise.

That is, this excerpt performs the helpful task of framing �the best compromise� somewhere between two extreme viewpoints.

It would be helpful (at least for me) if this group could discuss what �the best compromise� actually �looks like� in practice. How does one actually understand and live within �the best compromise�?

Let�s start with a relatively simple scenario:

What should clinicians do when they are working with EHRs that have known �problems� that are putting patients at risk, and the problems are not being immediately addressed, either directly or indirectly through, for example, an acceptable �work around,� or other adjustments to the EHR or local business processes?

Should the clinician continue to use the EHR and�

• assume that others (e.g., vendor, IT department, administration, etc.) will fix the problem(s)?

• report the problem(s)? Once? Twice? Three or more times? (How many?) To whom?

• inform the patient of the known problem(s) (if the problem(s) apply to the patient)?

• inform the patient that we do not have a good understanding of how to balance or even understand the risks posed by the EHR, given the dearth of peer-reviewed literature and algorithms? (What is �acceptable risk� for a given EHR problem? Does the EHR-related problem�s risk/benefit analysis change if the patient is in the hospital for a simple, nonlife-threatening problem vs. a complex, life-threatening problem)?

• give the patient the option to NOT use the EHR? (Note that we almost always give patients the choice to refuse other �risky ventures� such as diagnostic procedures and treatments.)

• inform their medical malpractice insurance company of the EHR-related problems?

• submit the problem(s) to the organization�s ethics committee, if there is one?

• report the problem(s) to the organization�s risk management staff?

• report the problem(s) in writing or verbally?

• stop using the EHR?

Etc. (including some combination of things).

Can providers (especially physicians) legitimately rationalize, given our ethical (to patients and our colleagues) and legal obligations (to patients and the state where we are licensed), the use of tools that are posing risks to patients and providers, when those risks are not spelled-out, not well understood, not peer-reviewed, etc.?

(Obviously everything we do has risks, but we are obligated to revel and discuss those risks as noted above. Further, the risks/benefits of a given diagnostic or treatment intervention are the product of peer-reviewed algorithms. Are patient�s aware of the risks associated with their doctor�s or hospital�s EHR?)

Again, the above excerpt suggests that there is a � best compromise.� But what is/are �the best compromise(s)�?

I joke with friends that I am a �radical moderate� � that is, I usually find myself committed to the �middle ground� in most complex and thoughtful discussions. But when it comes to EHRs, I am finding it difficult to define or understand what a �moderate� or an acceptable �best compromise� looks like.

Given the current EHR exuberance driven by ONC�s incentive dollars and vendor profits (or hoped-for profits), we all know that the �politically correct� approach is to �go along� and be an �early adopter� (without too many protests). But is the politically correct approach really the �best compromise,� especially in light of our ethical and legal obligations?

I am anxious to hear what other people think about this matter. I am sincerely seeking help in better understanding a sensible, real-life �best compromise� for those of us in the trenches.

Note that if we cannot define �the best compromise,� then what does that say about us? How can we justify �getting on board� with patient care tools (e.g., EHRs, eRx�ing, etc.) that are posing risks (known and unknown), with no clear processes for informing patients, not giving patients their choice to use these e-tools, no clear evidence-based risk/benefit analyses, etc.?

My own pithy, initial responses are as follows:

Re: Given the current EHR exuberance driven by ONC�s incentive dollars and vendor profits (or hoped-for profits), we all know that the �politically correct� approach is to �go along� and be an �early adopter� (without too many protests). But is the politically correct approach [i.e, "go along to get along" - ed.] really the �best compromise,� especially in light of our ethical and legal obligations?

No, for the reasons after your comma. [i.e., in light of our ethical & legal obligation - ed.]

One should look to the past for lessons in what the "compromises" might be.

How about the Flexner Report of 1910 as a start?

The treatises on human research protections penned largely after the Tuskegee experiments and the horrors of WW2, such as these as listed on an NIH web page "Office of Human Subjects Research, Regulations and Ethical Guidelines" might also shed some light:

• 45 CFR 46 Protection Of Human Subjects

• Guidelines for Conduct of Research Involving Human Subjects at NIH (Gray Booklet) (pdf file)

• The Belmont Report Ethical Principles and Guidelines for the Protection of Human Subjects of Research

• Nuremberg Code Directives for Human Experimentation

• World Medical Association Declaration Of Helsinki

I further opine:

Re: How can we justify �getting on board� with patient care tools (e.g., EHRs, eRx�ing, etc.) that are posing risks (known and unknown), with no clear processes for informing patients, not giving patients their choice to use these e-tools, no clear evidence-based risk/benefit analyses, etc.?

Perhaps with the line that "I never make mistakes ... everything I do is an experiment."

The technology is experimental. Perhaps the best way forward is to treat it as such.

In medicine I think there's a rich history of how to conduct proper (and improper) experimental research.

Again, Dr. Monteith raises some critical questions that need to be answered.

Or, more correctly, needed to be answered a long time ago, and long before planned national rollouts of healthcare information technology.

-- SS

Princess Health and Australian ED EHR Study: An End to the Line "Your Evidence Is Anecdotal, Thus Worthless?" .Princessiccia

Princess Health and Australian ED EHR Study: An End to the Line "Your Evidence Is Anecdotal, Thus Worthless?" .Princessiccia

AMIA healthcare IT anecdote Jon Patrick OHSU William Hersh

Gusty 06:55 Add Comment

At my Sept. 2010 post "The Dangers of Critical Thinking in A Politicized, Irrational Culture" I lamented that while my early mentor in biomedicine Victor P. Satinsky MD taught the wise credo "critical thinking always, or your patient's dead" in the 1970's, our culture had become so perverse that this credo had been largely supplanted with:

"Critical thinking anytime, and your career's dead."

That post was in reaction to continued heckling on a professional mailing list, the American Medical Informatics Association (AMIA) Clinical Information Systems Working Group (cis-wg). On this list, Oregon Health Sciences University professor William Hersh expounded on how the evidence of health IT dangers was largely "anecdotal" therefore to be discounted, and how I, specifically, "didn't know the literature on health IT."



In that post I put the lie to the latter figment. On the former prevarication Dr. Jon Patrick, author of the recent thorough dissection of problems with the ED EHR system being rolled out in public hospitals in New South Wales, Australia (see my Mar. 5, 2011 post "On an EMR Forensic Evaluation by Professor Jon Patrick from Down Under: More Thoughts"), hit the ball out of the park:

Prof. Patrick to AMIA cis-wg:



I think such defences are particularly unuseful especially with respect to the dismissal of personal stories and experiences as "anecdotes", hence committing them to the realm of folklore. I offer these notions as a counterpoint.



Discounting Anecdotes:



1. Is a perfidious and specious act.



2. It denies early warning signs of problems.



3. It denies a voice and disempowers the working clinical community who have to operationalise decisions made by others.



4. It denies a route to process improvement within an institution - which is most important for EBM and incremental review of local processes.



5. It defends software manufacturers from fault rectification - cuts off even a need to deliberate on it. Critics of the value of anecdotes are squarely on the side of the faulty and deficient manufacturer.



6. A rule of project management is that projects consist of 3 components, cost, quality and time and if their needs to be a compromise it has to be on quality. Anecdotes are early warning signs of such a compromise.

Prof. Patrick had to once again put the lie to this refrain at a comment on the HISTalk blog yesterday, where the anonymous proprietor had written in a review of Patrick's EHR study:

... On the other hand, I wouldn�t say it�s [Prof. Patrick's Cerner FirstNet study] necessarily unbiased, it focuses on implementation of a single department application that didn�t go well for a variety of reasons (despite many successful FirstNet implementations elsewhere), it uses the unchallenged anecdotal comments of unhappy users who make it clear they liked their previous EDIS better, and it nitpicks (I wasn�t moved to find a pitchfork when I learned that the primary keys in the Millennium database aren�t named consistently).



[Considering the complexity and changeability of healthcare and the corresponding software lifecycle, I duly note that that latter attitude about 'failing to find pitchforks' regarding breaches of sound software engineering practices seems to be a symptom of the larger health IT disease that Prof. Patrick writes about - ed.]

Dr. Patrick then knocked the ball out of the Southern Hemisphere with a comment of his own about anecdotalism and a link to an expansion of the aforementioned ideas he'd shared on "discounting anecdotes":

Prof. Patrick to HISTalk owner:



Your Comment �it uses the unchallenged anecdotal comments of unhappy users � is not only unfair but unreasonably inaccurate. The comments made by the users are the Directors of 7 EDs and so they have a right to carry authority by virtue of the experience but also the number of 6 out 7 presenting a view of Firstnet as unfit for purpose has numeric validity, which they justify with about 20+ pages of their comments � see Part 2 Appendix 2.



I would also point readers to my editorial about the role of personal experiences being the most useful information to understand the nature of socio-technical failures. http://aci.schattauer.de/en/contents/archive/issue/1124/manuscript/15463/show.html

The essay at that link, "The Validity of Personal Experiences in Evaluating HIT", is an editorial in Johns Hopkins informaticist Chris Lehmann's brilliant new journal "Applied Clinical Informatics."



The editorial is available free, and is a must-read for anyone in a decision-making or managerial role in mission critical domains, including our elected representatives.



In the editorial Dr. Patrick concludes. similarly to his earlier AMIA mailing list opinion:

... the denial of recounted personal experiences in discussion and analysis of HIT is biased and specious and has the effect of:



1. Denying early warning signs of problems.



2. Denying a voice for the working clinical community who have to operationalise decisions made by others and thus disempowers them.



3. Denying process improvement within an institution � which is most important for Evidence Based Medicine and incremental review of local processes.



4. Discourages staff from engaging in any form of process improvement hence worsening the sense of disenchantment.



Every legitimate personal experience of a HIT deserves to be considered on its merits lest we wish to retreat from process and product improvement. Mechanisms of censorship both implicit due to contrived processes of disinformation and disempowerment or explicit due to contractual specifications will lead to more waste, lost productivity, contempt for the providers, and distress among frontline staff rather than increased productivity and improved patient health and safety as we all desire.

In my view, the drivers or motivators for the "anecdotalist" accusation are these, singly or in combination:

• Too much "education" to see the nose on one's face, as in, to think zebras and unicorns instead of horses when hearing hoofbeats outside one's midwest U.S. abode (eggheads);
  
  
• Too little common sense (fools), as in Scott Adams' example: "IGNORING ALL ANECDOTAL EVIDENCE - Example: I always get hives immediately after eating strawberries. But without a scientifically controlled experiment, it�s not reliable data. So I continue to eat strawberries every day, since I can�t tell if they cause hives";
  
  
• Too much concern for the possible interruption of flow of money or power in one's direction (gonifs).
  
  

In conclusion, the anecdotalist refrain of "your evidence is anecdotal" [therefore of little or no value] when used repetitively against competent observers is the refrain of eggheads, fools and gonifs.



In healthcare, the end result is "your patient's dead."



My "anecdotal relative" injured in a mid-2010 HIT mishap is sadly an example.



[June 2011 addendum: my relative, after much suffering, has now died of complications of the "anecdotal HIT mishap" - ed.]



As for myself, I am a Markopolist (see my Sept. 2010 post "Health IT: On Anecdotalism and Totalitarianism").



-- SS

Princess Health and The Reappearance of a Ghost of Seasons Past. Princessiccia

Princess Health and The Reappearance of a Ghost of Seasons Past. Princessiccia

Actonel conflicts of interest ghost writing manipulating clinical research Procter and Gamble suppression of medical research University of Sheffield whistle-blowers

Gusty 08:01 Add Comment

About a year after we started Health Care Renewal, in late 2005, we wrote multiple posts about the complex and unfortunate case of Dr Aubrey Blumsohn's attempts to keep a research project honest. The early posts were here, here, here, and here. In this post, we summarized the case thus:

• Dr Aubrey Blumsohn, a senior lecturer at Sheffield University, and Professor Richard Eastell performed a research project on the effects of the drug risedronate (Actonel, made by Procter & Gamble Pharmaceuticals [P&G]) under a contract between P&G and the University.
• Although the research contract designated Blumsohn and Eastell as "Investigators" under whose direction the project would be carried out, Blumsohn was not given access to the original data collected by the project.
• Despite numerous requests, (like this one), P&G refused access to this data repeatedly.
  Blumsohn was concerned that he and Eastell could be accused of scientific fraud if they continued to make presentations and write articles and abstracts without access to the data which they were supposedly writing about.
• Blumsohn became suspicious that some of the analyses done by P&G could be misleading, especially related to a graph shown to him that omitted 40% of patient data.
• Blumsohn objected to P&G arranging for papers and abstracts to be written by a professional writer, but with Blumsohn listed as first author. Blumsohn was concerned that such ghost-written documents were mainly meant to convey "key messages" in support of P&G's commercial interests.
• Eastell warned Blumsohn not to aggravate P&G, because the company was providing a grant to the University which "is a good source of income."
• After repeated failed attempt to get the data, Blumsohn complained to numerous officials at Sheffield University, including Eastell, medical school Dean Tony Weetman, University Vice-Chancellor Robert Boucher, and the Head of the University's Department of Human Resources, Ms R Valerio.
• Still unable to get the data, he spoke with news reporters about his case. At this point, Sheffield suspended him, but then offered him a severance agreement if he signed a contract binding him not to make any detrimental or derogatory statements about the University and its leaders.

So the case involved suppression and manipulation of research, ghost-writing, institutional conflicts of interest, and attempts to silence a whistle blower. It provides lessons about the downsides of letting commercial firms sponsor and hence control human research designed to evaluate the products or services they sell; and of academic medicine becoming dependent on research money from such firms for such research. Although Health Care Renewal, being US based, most often writes about such issues in the US, this case is a reminder that they are global. (Note that we posted more about this case in 2006, here, here and here, but since then it has not gotten much public attention.)

Last weekend the (UK) Guardian returned to it:

The Guardian has learned that one of Britain's leading bone specialists is facing disciplinary action over accusations that he was involved in 'ghost writing'.

The General Medical Council will call Professor Richard Eastell in front of a fitness to practice committee. Eastell, a bone expert at Sheffield University, has admitted he allowed his name to go forward as first author of a study on an osteoporosis drug even though he did not have access to all the data on which the study's conclusions were based. An employee of Proctor and Gamble, the US company making Actonel, was the only author who had all the figures.

Experts believe the practice is widespread in Britain.

In a letter published in the Journal of Bone and Mineral Research, which carried the original study, he stated: 'In the original paper one of the authors, a statistician working for P&G, Ian Barton, had full access to all the data.' The authors had full access to all the analyses of the data that they requested, he said � but those analyses were carried out by the company.

The letter, published in 2007, also acknowledged flaws in the study. A later independent analysis of the data 'identified some errors and poor practice', he wrote. The study was designed to show the strengths of Actonel which was in fierce competition with a rival bone-strengthening drug called Fosamax, made by Merck.

Eastell's paper concerned a study carried out on behalf of Proctor and Gamble, comparing the bone density of women prescribed Actonel with others who were not. Only the company knew which women were on the drug and which were taking something else.

Eastell's colleague, Dr Aubrey Blumsohn, wanted the codes which would say which of the patients who suffered fractures had been on the drug. The company refused. Blumsohn took his concerns to Eastell, but in a conversation which Blumsohn says he taped , Eastell said he was concerned that persistent requests might damage the relationship they had with the company. Eastell is said to have told him: 'The only thing that we have to watch all the time is our relationship with P&G. Because � we have the big Sheffield Centre Grant [from P&G] which is a good source of income, we have got to really watch it.' .

So, after four years, this case has generated an official hearing of sorts. The hearing is obviously late, and seemingly will only be devoted to only one aspect of this case (ghost writing). However, at least our friends in the UK are doing something. I cannot recall a single case that resulted in any serious consideration of imposing negative consequences on anyone who was accused of suppressing research, manipulating research, endorsing ghost-writing, or intimidating a whistle-blower. In fact, many of the more troubling cases have never resulted in any sort of public discussion either at the institutions at which they occurred, or at any organization with relevant regulatory, or even just moral authority. So the GMC hearing is at least a step forward. Two cheers for the British GMC, and none for US universities, academic medical centers, professional societies, and government regulators.

(If anyone can remind me of a case in which there was a public discussion at the relevant institution, or some public consideration of the case by a regulatory agency, professional society, or some group with moral authority, please remind me of it, and I would be happy to post about it.)

Princess Health and Why Have Governing Boards Forsaken Their Duties? - Ideas from Silverglate and Malchow. Princessiccia

Princess Health and Why Have Governing Boards Forsaken Their Duties? - Ideas from Silverglate and Malchow. Princessiccia

boards of trustees conflicts of interest Dartmouth duty of care duty of loyalty duty of obedience finance governance

Gusty 08:46 Add Comment

We have posted frequently about the governance and leadership of academic medical organizations. While one would think that health care organizations, and especially academic health care organizations ought to be held to a particularly high standard of governance, we have noted how their governance is often unrepresentative of key constituencies, opaque, unaccountable, unsupportive of the academic and health care mission, and not subject to codes of ethics. How the governance of organizations with such exemplary missions and sterling reputations got this way has been unclear.

Now there are new insights from the ongoing discussion of one of the most interesting and controversial cases of disputed organizational governance. We have often come back to the example of Dartmouth College, of which Dartmouth Medical School is a significant component. We most recently discussed here an ongoing dispute about the extent that the institution's board of trustees ought to represent the alumni at large, or instead, ought to be a self-elected body not clearly accountable to anyone else. (For our take on this complex case, start here and follow the links backward.) The latest development in the case is a lawsuit filed by Dartmouth alumni challenging an increase in the number of self-elected, or "charter" trustees, which they charged broke an 1891 agreement that established numerical parity between alumni-elected and charter trustees.

Soon after this lawsuit was filed, an important article by Harvey Silverglate (one of the founders of FIRE, the Foundation for Individual Rights in Education) and Joseph Malchow appeared. For those interested in the case, the article includes extensive detail, with multiple citations, on all the twists and turns of the case, and is very much worth reading. (See this post on FIRE's Torch blog for more background and discussion.)

However, the article also features extensive scholarship on governance of US not-for-profit institutions, focused on academic institutions (including medical academia), and with relevance to other not-for-profit or non-governmental health care organizations. In particular, the article sheds light on how the governance of such organizations has become so degraded.

First, Silverglate and Malchow summarized the duties of governing boards:

Traditionally, fiduciary duty [of the board of trustees] has been understood as having two components: the duty of loyalty and the duty of care. The duty of loyalty requires a fiduciary to act in a manner he or she reasonably believes to be in the best interests of the organization. The duty of care obliges directors to inform themselves of reasonably available information prior to making a business decision. More recently, courts have considered the duty to act in good faith [the duty of obedience] as a fiduciary requirement. This component, similar to the duty of care, is satisfied when a director makes informed decisions without conflicts of interest.

The question central to the dispute regarding Dartmouth governance is to what or to whom do fiduciaries owe their duty. Corporate directors have a relatively straightforward task of serving the corporation and its shareholders. In the case of a charitable trust, however, which generally does not have 'ascertainable beneficiaries who can enforce their rights,' the duty of fiduciaries is instead directed toward fulfilling or furthering the organization�s mission

So just to summarize, considerable discussion, scholarship, and I believe some some laws support the notion that the board of a not-for-profit organization is obliged to take reasonable care to make informed decisions free of conflicts of interest to uphold the organization's mission.

However, currently, many boards value deference to the organization's (usually hired) top managers and avoidance of internal conflict within the board more highly than these obligations:

Dartmouth, to be sure, is far from the only place where fealty to organizational leaders�and the notion of 'going along in order to get along' �has been placed before true fiduciary duty.

Silverglate and Malchow have some important ideas about how we came to this.

Not-for-profits became more like for-profit corporations:

During the 1980s, traditional nonprofit organizations supported by donations and governed by donors and volunteers became increasingly displaced by professionally staffed commercial nonprofits, supported by grants, contracts, and earned income, and governed by insider boards. The shift in governance was armored by progressively professionalized and entrepreneurial management, which was perceived to be more adept at control of the ebb and flow of funds in the American market.

Top hired not-for-profit executives assumed more power at the expense of other constituencies, including the professionals who did the work:

By the 1990s, with faculty power firmly institutionalized at colleges and universities, a notion that university presidents were bereft of power took hold. The AGB [Association of Governing Boards], in 1996, argued that university presidents needed to regain power with a pivotal document of its own: Renewing the Academic Presidency: Stronger Leadership for Tougher Times. Though this outlook was applied to varying degrees at colleges and universities, an imperative toward greater executive power in universities was thus established.

Presidential and professorial decision-making power, combined with the rise of the administrative bureaucracy in academia, have generally relegated trustees to a secondary role in campus affairs.

Attempts at reforming governance were inappropriately based on a for-profit corporate model, and particularly the need to project unity and avoid confrontation among the leadership trumped transparency:

Aligning academic boards with the cultural trends of increased critical oversight has obvious benefits, but some boards have moved to adopt the norms of for-profit corporate governance that are simply not applicable to the university context. Admittedly, this is a thin distinction when considered on a theoretical level. But in practical terms, misguided nonprofit reforms�some of which, upon close examination, actually violate an institution�s mission�are readily evident.

For example, some nonprofit boards have emphasized the adoption of formal nondisclosure pledges or confidentiality agreements that step well beyond nondisclosure of proprietary information. This is hardly uncommon in the business sector, where bottom-line strictures demand a certain degree of internal accord and non-transparency. And though there is evidence that nonprofit board directors have, from time to time, attempted to hush public dissent, only recently have dominant majorities of some nonprofit boards proposed and ratified binding pledges not to publicly air differences. According to a 2006 BoardSource publication, 'If a board member does not support a decision for whatever reason, [he or] she has a responsibility to remain silent or step down from the board.' (Recall the resignation offer made to Zywicki before his second term was denied.)

These directives, written in highly influential publications in the realm of university governance, disregard the important role that public discussion has on decision-making at universities and nonprofits in general. 'In the nonprofit context, nondisclosure agreements or the use of 'executive session' rules to curtail debates about policy and procedure depart from established norms. They shut down opportunities for public dialogue and for communication with other concerned and influential parties, including reporters,' nonprofit specialist Norman I. Silber wrote in the Oregon Law Review.

Emphasis on raising money rather than upholding the mission has lead to board deference to hired executives.

Fidelity to institutional leaders, rather than institutional mission, is now paramount in higher education, as deviation from accepted decisions is perceived as potentially shrinking the donor base. Administrators cringe at public disagreement; rather than focusing on the long-term likelihood that competing ideas will result in implementation of the fittest, they tend to focus on the short-term possibility that a particular alumni subset may be offended. This shortsighted outlook is not only an insult to the intelligence of alumni and other constituencies, but it is ultimately detrimental to the institution, as established ideas are enthroned and unchallenged. It is also based on false premises: as in the case of Dartmouth, there is no established correlation between public criticism and donor decline.

Boards are increasingly composed of executives of for-profit corporations, particularly in the finance field, who may grant the same deference to the organizations' leaders that they would like from their own board. That is, hired executives identify more with other executives than with the organizations they are supposed to be leading:

Judge Cabranes noted that trustees, especially business executives, tend to act toward university presidents as they wish their boards would act toward them�deferentially. And the phenomenon of board members believing they serve at the pleasure of the executive is what one nonprofit attorney and blogger, has termed 'upside down board.' The ascendance of the hedge-fund community, a peculiar province of graduates of elite institutions, has contributed to the prevalence of the upside down board....

The article suggests some issues that need to be addressed to make governance more accountable, transparent, ethical and honest. Boards need to be reminded of their duties, and that their loyalty should be to the mission, not the organization's executives, or the views of the board's majority. Transparency and open discussion are more important than projecting the (sometimes false) impression of unity. New board members should be chosen for their loyalty to the mission rather than their similarity to and congeniality with current board members.

I strongly suggest that anyone who cares about how health care organizations are run ought to read Silverglate and Malchow's full article. It should be required reading for current and would-be board members of academic and health care not-for-profit organizations (but I will not hold my breath waiting for them to read it.)

Princess Health and A "Safety-Net" Medical Center CEO Gets a Golden Parachute. Princessiccia

Princess Health and A "Safety-Net" Medical Center CEO Gets a Golden Parachute. Princessiccia

Boston Medical Center Boston University conflicts of interest executive compensation governance imperial CEO

Gusty 12:16 Add Comment

From theBostonChannel.com comes this story on executive compensation in a not-for-profit health care organization,

Boston Medical Center � a financially troubled hospital � gave its outgoing CEO a one-time, nearly $3.5 million payment, in addition to her $1.3 million annual salary, Team 5 Investigates reported Friday.

Elaine Ullian, 61, has led the city�s major 'safety net' hospital for the last 15 years. She recently announced she will retire when her contract expires in January.

The hospital's financial situation is such that hospital leaders say it could face closure in the years ahead. It is currently suing the Executive Office of Health and Human Services over how it gets paid for treating poor and uninsured patients.

Team 5 Investigates discovered, in a review of the hospital�s financial filings with the state, that Ullian was paid $3,466,458 'in recognition of exceptional performance over a period of 15 years.'

The nearly $3.5 million bonus was on top of Ullian�s 2008 compensation of $1,348,504 including salary and benefits.

In a written statement to Team 5 Investigates, Ted English, the chairman of BMC�s board said that Ullian�s 'compensation is set by a committee of the Boston Medical Center Board of Trustees who consult with independent compensation advisors. It is based on her performance evaluation and measurable goals that are reviewed annually.'

'The Board considers Elaine Ullian to be one of the most competent and successful hospital CEOs in the country and believes she is primarily responsible for the success of Boston Medical Center over the past 15 years,' English's statement said.

Boston Medical Center was formed by the merger of University Hospital (the Boston University teaching hospital), and Boston City Hospital, the legendary municipal hospital. (Note: I served as an internal medicine intern and resident in the University Hospital program, and rotated through Boston City frequently.) Thus, as noted above, BMC is the city's primary "safety net" hospital for the care of the poor. BMC has for its mission:

We will provide consistently excellent and accessible health services to all in need of care regardless of status or ability to pay � exceptional care, without exception.

Such generous pay seems inconsistent with this mission and the organization's not-for-profit status. Such a golden parachute seems inconsistent with the current threats to its finances.

Any worry about the CEO's retirement finances should further be reduced by her ongoing part-time work on the boards of directors of three public for-profit health care corporations, Hologic, a medical device company specializing in "womens' health," ThermoFisher Scientific, a manufacturer of laboratory equipment and supplies for health care and research, and Vertex Pharmaceuticals, a biotechnology company focusing on small-molecule drugs. For her work as a director of Hologic, she received $304,698 in total compensation in 2008, and owned 40,000 shares or equivalent of common stock (per the company's 2009 proxy statement). For her work for ThermoFisher Scientific, she received $275,319 total compensation, and owned 61,068 shares or equivalent (per the 2009 proxy statement). For her work for Vertex Pharmaceuticals, she received $337,480 total compensation, and owned 79,500 shares or equivalent (per the 2009 proxy statement). As Robert AG Monks put it, corporate directors are supposed to "demonstrate unyielding loyalty to the company's shareholders" [Per Monks RAG, Minow N. Corporate Governance, 3rd edition. Malden, MA: Blackwell Publishing, 2004. P.200.] Therefore, Ms Ullian's directorships seem to pose conflicts with her primary employment as CEO of an academic medical center which must buy products used in womens' health, buy laboratory supplies, and implement basic and clinical research.

The BMC board chair's assertion that the CEO is "primarily responsible for the success" of the institution merits special comment. It seems obvious that the main determinant of the success of a medical center is the work done by its health care professionals and support personnel. A medical center cannot provide care, much less good care, without doctors, nurses, therapists and technicians, supported by supply, logistics, cleaning, maintenance, dietary, clerical, medical record, financial and yes, even health care information technology workers and systems (and if I left out an important group of support personnel, I apologize now.) The chair's assertion suggests the hubris central to the ethos of contemporary business managers, but is at odds with the clinical context. (Of course, if the CEO was primarily responsible for the organization's success, she should now shoulder primary blame for its current awkward financial situation, but such consistency may be the hobgoblin of minds too little to understand the gravitas of the C-level manager.)

A long time ago, in a galaxy far, far away, health care was a calling. Doctors once pledged to avoid all commercialization (see post here), and hospital directors or superintendents (not CEOs) did not earn riches, much less become "imperial." (See Ludmerer's Time to Heal.) But in the culture of wretched excess that spread from the financial world, hospital CEOs now seem to feel entitled to become wealthy, as they claim responsibility for all successes, while all failures are blamed on someone else. The current system has made hired managers into an ersatz aristocracy, entitled to fill their pockets while denying any responsibility for ever rising costs, declining access, poor quality and demoralized professionals. In my humble opinion, to achieve true health care reform, health care again must become a calling, lead by people who will put the mission ahead of the accumulation of wealth and power.