Efficient Rural Health Care
by Tim Size
Four years of studying engineering isn't the obvious preparation for the administrator of a rural hospital cooperative. But there are engineering applications that have proven to be useful, like the law of thermodynamics that requires one ice cube to always hit the floor when you grab a handful from the ice-maker. Another would be the concept of efficiency as in "half of the western world" wants you to be more cost effective. But before I go on, relax, I'm not going to put in print the obvious - that the most efficient distribution of Wisconsin's hospital beds would be to put them all on one campus in Sauk County. We have a long way to go in health care to determine what we mean by efficiency and this brief article can only present a subset of relevant ideas.
Frequently overlooked in demands for proof of efficiency is the principle that a determination of efficiency outside of the laboratory always requires answers to two questions: (1) What is the appropriate unit or system to analyze and (2) efficient compared to what? The most efficient car may be the one that gets the best gas mileage: a system described by an input of gallons of gas per output of miles traveled. But it may be equally well described by an input of dollars to purchase and operate that car per output of miles traveled. Considering the impact on my budget, a gas guzzling rusted land yacht is several times more efficient than a 20 or 30 thousand dollar sparkling engineering marvel but less so than a modest serviceable compact. (The biased analogy to urban and rural health care is intended.) The determination of efficiency is always a case of "it depends"; it depends on the choice of the system to be described and the systems being compared.
We still hear a lot about occupancy rates as the main measure of hospital efficiency, especially from Washington, but is a 6 bed hospital at 90% occupancy really more efficient than a 50 bed hospital with a 60% occupancy, let alone when the latter is providing other major services to the community? This is the classic comparing apples to oranges problem. On any given day there are more people working under one roof at the University of Wisconsin's Clinical Science Center than live in the average rural municipality with a hospital - can one or two simple numbers really be used to compare health care organizations serving significantly different purposes in substantially different environments? To determine relative health care efficiency we must compare facilities or programs with comparable levels and types of activities in comparable environments - this has become more difficult for rural hospitals as they diversify beyond brick buildings and beds. Regardless, measures of efficiency must always ask about "compared to what?"; when buying a compact car you make comparisons among compact cars.
Given the growing political pressure for a more efficient health care system and the difficulties inherent in judging the efficiency of individual rural hospitals, I am proposing that we need to expand our unit of analysis of efficiency from the individual hospital to include the broad array of institution based services and relationships included in the Rural Medical Center model proposed by the Rural Wisconsin Hospital Cooperative and the Wisconsin Hospital Association.
Additional momentum in this direction comes from the Rural Health Development Council within the State Department of Development. It has already begun to include local economic development into its consideration of good rural health policy. One of the reasons we won't see all of Wisconsin's hospital beds in Sauk County is that local savings in the cost of health care in each the other 71 counties won't offset the negative impact on local economies.
Less obvious but of at least equal importance is the need to go even beyond an analysis of diversified institutions such as Rural Medical Centers and to add to our unit of analysis a score card about the total health of the community - to expand the frame of analysis from individual institutions to the community as a whole. Are we efficient if we cut the cost of recovery from heart attacks by 30% while ignoring known cost effective interventions with high risk populations that eliminate the need for the recovery in the first place? Are we efficient if we support competing services within a rural county with barely the resources to support a single partnership or collaboration? A clinic that shows a profit at the expense of the hospital is not contributing to efficient health care any more than a hospital that shows a profit at the expense of a public home health program. It all depends.
This expanded view of calculating efficiency also has implications on other major actors. One example of this recognition would be the University Task Force on Rural Health requested by legislative leaders and recently established by the U.W. System to evaluate the relationship between University operations and the current rural shortage of many health care professionals. From one perspective, without a doubt the most efficient way to train young professionals is to bring them into a central campus and never let them leave - it saves on a lot of messy logistics and inconvenience. However if we accept a combination of academe and local communities as the unit of analysis, our current training system is horribly inefficient, contributing to surpluses in some areas and critical shortages in others.
We need substantial improvement in both our definitions of efficiency and their quantification. For most of rural Wisconsin I believe an analysis based on the input of dollars into the county and the output of community health and economic status is the most appropriate perspective to take when judging rural health care efficiency. Through this article I would hope to challenge all interested individuals to begin to determine what analytical tools can be best used to describe a community "Income Statement" and "Balance Sheet." Informed community-wide decisions will need to be made based on data in a manner analogous to that now taken for granted by health care financial management at the individual institutional level; some of the tools are already available, others still need to be developed. Lets go to work.
