The VA System's Corrosive Culture

June 30: Breaking News: This morning, the US Supreme Court sided with Hobby Lobby in its challenge to the Affordable Care Act’s requirement that certain methods of contraception be covered by an employer’s health plan. The court’s 5-4 decision will, no doubt, mean the role of employer-sponsored health insurance will change as other challenges to the ACA work their way through the court system.

Last week, news of the VA healthcare system’s flaws came to a head as White House special investigator, Rob Nabors, reported that its problems were pervasive due to a “corrosive culture” that discouraged feedback and ignored its problems. Today, the President announced he is nominating Bob McDonald, retired CEO of Proctor and Gamble, to lead the VA and fix it.

Yesterday, the New York Times investigative team released its analysis of the military hospitals that care for 1.6M active duty personnel and their families. It found higher than expected complications in the system’s hospitals for maternity and surgical care, concluding “ scrutiny is sporadic and avoidable errors are chronic.”

Many will jump on the bandwagon that concludes these two—the VA and military health-- reflect the ineptitude of government run programs. This same group points to disappointing results in public education, failed oversight of the mortgage loan industry that led to the economic meltdown, and last year’s problems with the Healthcare.gov rollout to support their hypothesis that the government is unable to manage complex programs compared to the private sector. Privatizing programs like the VA health system deserves discussion—integration in community-based care management programs might deliver better results and lower costs compared to isolation in the VA system. But cultures that appear to compromise their principles, cut corners and hide from scrutiny are not exclusive to government-run programs like the VA and military hospitals.

Last week, I flew 9 flight segments on four different airlines. Three on my original itinerary were cancelled. The airlines advised me I had been rebooked—each rebooking was hours later or for the next day, obviating the purpose of the travel unless other arrangements could be made. I lost 14 hours on unnecessary waits in airports, arrived at 3 am vs. a scheduled 5 pm arrival the evening before ending the week exhausted and frustrated.

Travel warriors pay the highest prices for airfares enduring full planes, middle seats, unhealthy airport food and sleepless nights to ply their trade. But the air transportation system is not publicly owned: it is regulated by the FAA, but its shareholders own it. Ditto other major industries in our economy: banking, energy, automotive and others are highly regulated and privately owned. In healthcare, the same is true for drug and device manufacturing, health insurance plans, medical practices, most hospitals and so on. At no point in last week’s travel nightmare did a single agent express “I am sorry” or offer the help. I was routinely directly to service counters or hotlines instead. That’s a reflection of culture: behavior that’s accepted as norm. Perhaps akin to altering records so veterans appear to see physicians on time when the facts are otherwise.

So the VA and military hospital shortcomings are arguably more about their cultural flaws than ownership. But cultural flaws are no more resident in government-run programs than the private sector. Ownership status—either not for profit, for-profit or government run—does not define a corporate culture nor predict accepted behaviors. The leaders in these organizations do.

Encouraging whistleblowing in any organization is tough. The tone is set by leaders who encourage candor, measure performance objectively and avoid the natural tendency to surround themselves with “yes men.”

The problems in the VA and military hospitals have not been fixed, but they’re now exposed. How solutions are studied and changes implemented is the next chapter. But the lesson should not be lost on the rest of our industry—it’s a new day. Culture matters. Feedback matters. And everything about us is in full public view.

Paul 

PS: Howard Baker died last Thursday at 88. To Tennesseans, he was our statesman in DC. To me, he epitomized public service and what it meant to speak clearly and apply common sense to problems. He supported equal rights, civil rights and co-founded the Bipartisan Policy Center to advance the notion that solutions are rarely the exclusive domain on one side or the other in a debate. BPC, early on, offered a blueprint for health reform that included mandatory coverage while protecting our system of hospitals and doctors. 

I got to know Senator Baker in 1972 while doing research in DC about the impact of the Watergate break-in on the public’s view of the government. Like so many, I admired his demeanor and valued his counsel through the years. His tributes will no doubt be legion. The New York Times and USA Today called him the “great conciliator.” We’ve lost a national treasure.

Sources: Michael Shear, Richard Oppel “Report Finds Health Unit of V.A. Needs Overhaul” New York Times June 27, 2014; Sharon LaFraniere, Andrew Lehren “In Military Care, a Pattern of Errors but Not Scrutiny” New York Times June 28, 2014; Rem Rieder “Howard Baker: The Great Conciliator” USA Today June 27, 2014; David Stout “Great Conciliator of Senate who Cast Hard Eye on Nixon” New York Times June 27, 2014; Stephen Miller “Ex Senate GOP Leader who Bolstered Reagan” Wall Street Journal June 27, 2014