Medical staff organization in three European multi-hospital systems: an exploratory study

Health Policy, 4 (1984) 43-62 Elsevier

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HPE 00006

Medical staff organization in three European multi-hospital systems: an exploratory study Mia Defever Medical Sociology, Department for Hospital Administration and Medical Care Organization. University of Leuven, Vital Decosterstraai 102, B-3000 Leuven, Belgium

Summary Multi-hospital systems have increased rapidly in number in recent years. This development is based primarily on hoped-for economies of scale, better access to the capital market, and more expert management. The place and the role of doctors in this process has, to judge from the literature, been passed by almost unnoticed. Is this also a case of the “benign neglect” that prevailed with respect to the medical organization when management structures were established in the separate hospitals? The present article reports on an exploratory studyofthe situation ofdoctorsand the medical staff organization in three European multi-hospital systems. Two important structural elements, the strengthening of management and the medical staff organization, appear to be of fundamental importance for the determination of the place and the role of doctors in multi-hospital systems and of the way the doctors themselves experience the system. There are a number of factors that one may assume affect the situation of doctors in such systems: the process of system formation, the size of the system, the influence of the general environment, cost-consciousness of the doctors, and the force of strong personalities.

Doctors in transition Multi-hospital systems or organizations within which several hospitals cooperate have spread remarkably throughout the Western world. Just as remarkable is that doctors in general and medical staffs in particular have been surpassed by this development if not ignored. The present article reports on the findings of an exploratory study on the place and the role of doctors and medical staffs in the policy of multi-hospital systems. Such systems of several institutions are not new in health care. Cooperative relationships between hospitals have existed for already more than a century. However, 0168-8510/84/%03.00

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what was formerly a rather sporadic phenomenon has in recent years multiplied rapidly. In the Netherlands, this development is called concertivorming (“concern formation”). In the Anglo-Saxon countries, one speaks of “multi-unit” or of “multihospital” systems. Although the rapid rhythm of growth in the U.S.A. has now decreased somewhat, the number continues to increase constantly. The “Center for Multi-Institutional Arrangements” of the American Hospital Association has calculated that about 32% of all hospitals in the U.S.A. belonged to a multi-hospital system in 1981 [1,2]. The tendency to form multi-hospital systems is perhaps not so pronounced in Europe as in the United States nor has it attracted the intense scientific interest that the multi-unit system phenomenon has generated there. In Europe, unlike in the United States, regionalization can provide a powerful impetus for the achievement of cooperation between hospitals. But it is as yet unclear whether this will proceed easily or with difficulties. In addition to regionalization, the more recent movement for cost containment via the closure of provisions requires a division of labor and cooperation. Both in the Netherlands and in Belgium, system formation is thus an essential element of the current “retrenchment policy”. The subject of the present study is an exploration of the situation of doctors and medical staffs in three hospital systems, namely in France, Ireland, and the Netherlands. The impetus for this study was given by the observation that the discussion of the place and the role of the doctor in multi-hospital systems is conspicuous by its absence in the flood of literature and studies that have been devoted to multi-hospital systems. Two trends can be observed in the literature on cooperative relationships, which is, as already noted, very extensive and largely of American origin. The first trend tends to produce enthusiastic if not euphoric stories about system formation. Cooperation is argued for as the logical and rational if not the only answer to the complex problems in which the individually functioning hospital is entangled. This trend in the professional literature, which coincides with the explosive initial period of system formation toward the end of the sixties in the U.S.A., is largely descriptive and attempts to state the “what” and the “why” of systems. The primary emphasis is on the conceptual approach to the nature and kinds of cooperative relationships. If the performance of systems is dealt with, it is generally in terms of “how it should or could be”. The second trend in the approach to multi-unit systems contains more refined stories. The question that predominates here is not so much “what” systems are but rather “how” they function. This approach, which is primarily analytical, is focused on the reasons why systems succeed or fail and attempts to explain what mechanisms can favor or hinder the realization of the supposed advantages. It is striking that no significant attention is given in either of these literature categories to the role of doctors in multi-hospital systems. The extent to which doctors in general and the medical staff organization in particular contribute to the success or failure of systems has remainedlargelyunexplored. Zuckermann[3]pointsout thatthis lacuna has arisen because attention has been given exclusively to three aspects: (a) economies of scale and easier access to the capital market,(b) the recruitment of more highly qualified management, and (c) broader service provision to the served commu-

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nity. Brown calls the doctor the “silent partner” in the pioneering evolution multi-hospital systems and notes that “no major studies of physician reactions highly integrated regional systems have been conducted”[4].

of to

A number of key concepts

The term “multi-hospital system” refers both to a structure and to a process that commences under the influence of particular forces. Hospitals set out to collaborate or the with each other for very different reasons, but they all concern the strengthening survival of the institution, for example, to obtain the hoped for economies of scale. Thus, one expects lower costs per output unit, a greater market share because of a broader service package, better access to the capital market, more involvement of relevant politicians, and so on. Hospitals move toward collaboration in an attempt to protect themselves against the increasing uncertainty of their environments. In a certain sense, cooperative agreements between hospitals are a form of adaptation to a hospital environment that is becoming ever more complex and turbulent. In industry, the reflex to react to signals from the environment has always been more alert and sharper than in the hospital sector. It took a relatively long time in health care before the need for fundamental changes was perceived and before there was any readiness to proceed to far-reaching co-operation and mergers. The environment in which hospitals function has drastically changed in the last twenty years. In the 50s and 60s hospitals found themselves in a fairly supportive environment. The current economic, demographic, and technological changes together with the cost-containment efforts of the authorities cause hospitals, if they want to survive, to anticipate changes rather than submit to them. The dominant flow in contemporary organizational theory employs uncertainty, which occurs in the environment and thus also within the organization, as the key element in the design of effective organizations. Galbraith states on the basis of the “contingency” theory that the degree of uncertainty is the most important variable on which alternative organizational designs are dependent [5]. Thus, there is no well-determined ideal organizational form, and not every form of organization is equally efficient in a particular situation. The success of cooperative relationships between hospitals as an organizational form will, from this point of view, be highly dependent on the degree to which hospitals are able to cope with the numerous uncertainties with which they are being increasingly confronted. The great challenge for system formation between hospitals remains the reconciliation of the differentiation of the various partial tasks with the necessary integration into an effective system. The greater the number of sub-tasks and the differences between them, the greater the difficulty in achieving efficient cooperation between the institutions. Lawrence and Lorsch contend in their study about the relation between organization and environment that there are only two important considerations in the design of an organization [6]. First of all, the sub-tasks must be organized to such a degree that they can be carried out efficiently. This aspect is called differentiation. The second aspect is the integration of the differentiated sub-tasks to achieve the objective of the organization as a whole.

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Multi-hospital systems are examples par excellence of complex organizations where the securing of the objective by means of highly differentiated sub-tasks forms a continuous challenge. According to Studnicki, the multi-hospital system concept is an abstraction or a symbol that means different things to different people but that nevertheless permits the exchange of ideas about the same reality [7]. DeVries gives a convenient taxonomy of cooperative systems and an operational description of the types he distinguishes.He positions cooperative relationships on a continuum that extends from agreements about limited matters to complete integration of direction, management, and ownership between at least two institutions [8]. Barrett also uses the continuum model but points out that there is no natural “gradual” progression from less to more integrated systems [9]. She also stresses that, although there is a fairly high degree of consensus in the literature about system typologies, little information is provided by them about how systems function and about how they develop or decay. In his description of systems, Brown points out that perhaps the most important distinguishing criterion must be sought in the strengthening of the corporate management and the way in which it controls and directs the system. This determines the difference between “ anything called a ‘system’ and the more traditional notion of independent community hospitals” [lo]. Particularly relevant in the description of multi-hospital systems is the distinction that is made between horizontal and vertical systems. The distinction is concerned particularly with the kinds of services the system offers. Several authors describe the vertical system as a group of institutions that, together and within a common objective, combine resources and management for the offering of more or less comprehensive health care to a well-determined population defined in a particular geographical area [1 l-141. Vertical systems unlike horizontal systems provide services going from primary care through tertiary care. This range of services contains in principle all the services needed by their population: general hospital services, primary care, extended care, rest and nursing homes, super-specialized care, and so on. Horizontally structured systems, in principle, group institutions that are comparable as regards their service packages. They operate under a corporate management and are either geographically contiguous or spread out over various regional markets. Institutions belonging to horizontal systems maintain on the average a higher degree of autonomy in the planning and development of their services and in their daily operations than is the case in vertical systems. Here, however, because of the need to strive for balance in the expansion of the comprehensive service packet, the corporate authority tends to become more involved both in long-term planning and in the daily policy regarding service provision. Meanwhile, it can be stressed that vertical systems act differently toward doctors than do horizontal systems, if only because doctors are the most important actors in the formation of the service package of a system. In the study of the “situation of doctors” in the three systems, attention was focused on two aspects: first, the structure and the process of the medical staff organization on the level of the system and second, the way in which individual doctors experience and evaluate their involvement in the system. The latter aspect derives its relevance from the fact that people adapt their behavior not to the objective situation but more to

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their perception of that situation. As Wilkinson put it, “people are disturbed and alarmed not by things but by their opinions and fancies about things” [IS]. People are satisfied, enthusiastic, irritated, or unhappy not so much by what actually happens but by their perception of these facts. The study of the situation of doctors in multi-hospital systems proceeded step-bystep on the basis of a particular paradigm. As information was gathered from privileged witnesses about the situation of the doctors, the specific subjects in the inquiry were adapted. Barrett, who used a similar approach for the study of the situation of top managers in multi-hospital systems, compares this approach to working a jigsaw puzzle: each new determination is like finding a piece, which provides a new perspective and makes it easier to find other pieces [16].

The research method Three multi-hospital systems were selected in three European countries: Ireland, the Netherlands, and France. The choicebf these systems was made rather pragmatically and was particularly dependent on the willingness of the system to submit itself to searching questions. This method of selection, however, did not prevent systems from being chosen with more or less similar characteristics as regards system form, patient mix, medical staff organization, and general system scope. All three cases are vertical systems with a common proprietor for all of the participating institutions and with a corporate structure that sketches the most important policy lines and makes the most important policy decisions. Each of the systems provides care on all echelons, from primary care to super-specialist care. Moreover, each of them is affiliated with a university. The institution-doctor relationship varies considerably in each of the systems. Some are full-time and work only in the system. Others carry out only a portion of their professional activity in the system. In each of the systems, there are doctors associated both with the system and with the university. The French system belongs to the public sector, unlike the Irish and the Dutch systems, which belong to the private sector. The information regarding the situation of doctors was compiled by means of structural interviews of privileged witnesses with the use of open questions. Three role groups were involved: (a) the corporate management, (b) the management of the individual institutions, (c) the leading doctors. The study concerned the following: Information and communication: the degree to which and the manner in which information from the corporate management is given to the doctors with particular emphasis on information content and the communication patterns; The distribution of power and authority: the amount of authority given to the doctors in decision making and the subjects to which this authority can be applied; Competition and rivalry: the competition between the individual institutions and services throughout the system; Collegiality: as a mechanism in the relationship between doctors and the way in which it serves or hinders the integration of the system;

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Promotion of interests: the striving on the part of the doctors for collective and individual professional and economic interests; Job satisfaction: the degree to which identification with the system, and its objectives and functioning leads to self-actualization and job satisfaction; Cost consciousness: the degree to which doctors comprehend the economic implication of their medical acts; Personality characteristics: the presence in the system of dominant personalities who act as driving forces in the orientating of the policy. This study does not envision making a representative comparison, the emphasis being given to the exploration of situations and not to the transference or generalization of the findings. The intention is to provide an impetus for representative comparative research to test the conclusions formulated on the basis of the exploratory research.

The Irish system The Irish system is the most recently formed of the three systems studied. It was begun 20 years ago when four doctors of the now cooperating hospitals set out to combine their activities. This system, which in fact is still in the evolutionary phase, comprises seven private institutions and is situated in a large urban area. The institutions are all well functioning units and are all affiliated with the university. However, by themselves as separate units, they are insufficiently equipped to offer a full range of services. The system was established by law in 1961, and a “central council” was immediately established to coordinate and later possibly to manage the activities of the cooperating institutions. Legal authority was assigned from the beginning to the central council to control the use of capital and the appointment of doctors. Also from the beginning, the central council received two immediate tasks: - the creation of shared service units, - the reallocation of the medical services throughout the system. These measures were, of course, necessary in order to create a vertical system. The long-term objective was the establishment of a new hospital. This objective, however, marked the commencement of a long and painful history that has already profoundly marked the short existence of this system. The location of the central hospital to replace the existing institutions has always seemed to have been the focal point of the tensions, but it is in fact only the stalking-horse for irreconcilable conflicts between institutions and individuals. In 1982, there was still no clarity about this long-term objective. The dream of a new hospital was able to obscure the tensions for many years and to create superficial cohesion. The need for a new building was obvious to each institution but from the outset it was very unclear how and by whom the new hospital would be directed, managed, and organized. The difftculties in the choice of location and the construction of the new hospital were aggravated by successive contradictory governmental decisions that sharply hindered and frequently blocked thecoordinating activities of the central council. In 1970, partially under the stimulus of the regional

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health council, it was decided to add the projected hospital to one of the already existing large general hospitals, which did not, however, belong to the system. This hospital, also affiliated with the university, offers a high level of care, but it has the image of being a hospital for poorer, elderly, and terminal patients. From the start, the institutions of the system showed little interest for approaching this independent hospital. The situation remains unclear and various scenarios are being projected: (a) entry of the independent hospital into the system, (b) merger of a part of the system with the independent hospital, (c) dissolution of the existing system with the establishment of a totally new system that would also contain the independent hospital. The central council, which functions as the corporate management structure of the Irish system, consists of forty members: five representatives of the regional health council and five from each associated institution, two of them being doctors. The central council, which chooses a chairman from its members, is subject to no external control or authority. A managerial staff provides for policy preparation and implementation. All of the decisions must be unanimous. This means that every decision is discussed at great length, which, along with the multiplicity of commissions and individual interests, causes delays in decision making and particularly in their execution. Moreover, the central council has few resources of its own, so that only a small managerial staff is possible. The first achievement of the central council was the establishment of a shared service unit, a central diagnostic unit. Although this unit is perfectly equipped and its operation is technically perfect, it is a source of conflict and frustration because of faulty integration with the participating institutions. The various institutions of the Irish system differ a great deal as regards climate, culture, and status. Each hospital has its own board of directors, its own administration, and its own medical advisory council. The doctors have considerable representation in these administrations. In addition, there are corporate medical advisory councils, which again discuss certain proposals from the individual institutions and, if necessary, reorient them for the benefit of the central council. Figure 1 gives a schematic overview of the structural relationships in the Irish system. The statute of the doctors associated with the Irish system is regulated by law. The statute provides legal security and social security, although it is not negotiable either individually or collectively. Recently, the doctors were compensated by salary in function of the time for which they are contracted. Private practice outside the system is permitted.

The Dutch system The Dutch multi-hospital system is situated in a medium-size city and is an entity composed of private institutions. Policy directives in the Netherlands are still being issued by the national authorities but, in the framework of efforts to achieve regionalization, there is the possibility that the sub-national authorities, in this case the provincial administrations, will acquire more authority in hospital policy in the future. In anticipation of this development, attempts are being made by the multi-hospital system to expand cooperation with still more institutions in the region for

Fig. I. Structure

of the Irish system

reasons that include warding off the danger of being absorbed by other systems. The Dutch multi-hospital system combines institutions that have been involved in the health care of the city and its environs for already more than 150 years. It can be called a vertical system. It consists of two general hospitals, four nursing homes, a specialized hospital, a shared service unit, and a data processing center. Thus, the multi-hospital system provides a good part of the care in the region, but it is not, however, representative of this region. The three hospitals are affiliated with the university. The system has undergone profound changes in the course of its development, and now a corporate central administration covers the various institutions. By statute, structure, and organization, this central administration is free of supervision by a public authority, although the government does intervene frequently to restrict the hospital operations. In the system, the operational management of the individual institutions is determined by their own administration and board of directors. Major new construction is in progress, which is taken as the occasion for concentration and reallocation of services within the system. The corporate “central administration” consists of a central board on which sit all the board members of the affiliated institutions. This organ meets semi-annually mostly about budgetary problems and about the financial condition of the system as a whole. The “executive administration” acts in the name of the central administration and is composed of the chairmen of the administrative boards of the affiliated institutions plus three members not involved in the operation of any of the institu-

tions. The executive administration is assisted by a “staff committee” that has mostly an advisory and preparatory role but also does the executive work. On the corporate level, there are two other more or less informal commissions: (a) the “medical planning commission”, which in principle is concerned with long-term planning, although it is now virtually inactive, and (b) the “hospital consulting service”, whereby the boards of directors of the general hospitals, which are fairly competitive with respect to each other, try to improve their mutual relations. Figure 2 gives the structure and the relationships of the Dutch multi-hospital system. Each institution in the Dutch system has its own administration, its own board of directors, and its own medical staff organization. Within the system, each institution has a considerable degree of autonomy and authority. There is no corporate medical staff organization, and doctors are not represented in the corporate managerial organs, which is the case in the Irish multi-hospital system. The impact of the medical staff via the staff administration on the policy of the individual institutions is obvious. Via the administrative channels of their own institutions, therefore, the medical positions do arrive at the system level. There is no uniform statute for doctors within the system. Individual agreements are negotiated between the doctors and the institutions. A number of doctors work on salaries, but the majority are independent contractors. By means of partnerships, i.e., partnerships of doctors of the various hospitals, possibly with partial pooling of honoraria and sometimes throughout the system, there is redistribution of income and the formation of close cooperative relationships on the micro-level.

The French system This cooperative organization, the second largest in France, is situated in a large city. It was established in 1802 when Napoleon, then Consul, combined the then two hospitals in the city under one common administration. The multi-hospital system now contains 21 institutions and as a whole is affiliated with the medical and pharmaceutical faculties of the local university. As such, there is in the system in general and for the doctors in particular an intermingling of three objectives: (a) patient care, (b) teaching, and (c) research. The French system is definitely vertical and provides virtually the full range of services in three geographic sectors of the city. It contains three types of institution: (a) sectorial hospitals, which offer out-patient primary care, secondary medical, surgical, and obstetric care, and refer to specialized tertiary care;(b) hospitals with the so-called “services lourds”, which fulfill the role of sectorial hospital for the population in their vicinity but are also referral hospitals for specialized services for the entire city and its environs; (c) specialized hospitals: hospitals with a limited and sometimes very specialized range of services, including convalescent homes and nursing institutions. The system is the owner of all the institutions, but is a subordinate administration under the prefect of the Departement and under the technical supervision of the regional director of the social service and health care agency. The system thus has double supervision, and there is a considerable amount of control over important

r

1

Board of Directors

I

rd

1

of Directixs

Central Administration

I

Executive Administration

CORPORATE LEVEL

I

INDIVIDUAL LEVEL

Fig. 2. Structureof the Dutch system. matters such as expansion of services, acquisition of capital goods, and construction. The recent decision to decentralize the authority in France will increase the say of the regional authorities. The structure and relationships of the French multi-hospital system are given in Figure 3. This illustration is not specific for the system studied, but gives a structure that is obligatory for all hospitals in France. The “general board”consists of representatives

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I General

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2 General

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Fig. 3. Structure

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of the French

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system.

from all of the groups involved in the hospitals (except the patients) along with representatives of the city and the health insurance associations. The representation of the doctors in this organ has been strengthened since 1970. The system has a ‘general executive board’ that provides the planning, development, and control of the system as a whole. On the corporate level, there is also an “advisory medical staff commission”, which operates with 14 subcommissions. In principle, the level of the general board is “deliberative and deciding”, that of the general executive board “executive”, and that of the advisory medical staff commission “advisory”. In fact, a great deal is decided on the level of the board of directors, and the doctors exceed their advisory authority by participating in policy and decision making. Thus, all dossiers, including the strictly financial and economic, that are discussed by the general board of directors are also included on the agenda of the advisory medical staff commission, The statute of the doctors is determined by the government and thus is not subject to negotiation. There are various statutes for doctors depending on whether or not they are associated with the university. The majority of the doctors work full-time. They are considered as the actual staff of the hospital. Up until recently, they had access to private hospitalization in their own institution. This was eliminated by the Ralitte Law, so that now only a limited amount of private consultation is possible in their own institution. Alongside the full-time doctors, there is a not insignificant number of physicians with privileges, doctors who, in addition to a private practice outside the system, hold consultations and/or admit patients to the system. This situation is a conscious policy option desired by both the administration and the medical staff to keep in touch with what is happening in the client population and among the solo practitioners. The medical staff structure is also developed in the individual institutions. The members of the corporate “advisory medical staff commission” are not elected, however, but are appointed from among the staff members ofthevarious institutions by the executive board together with the general board.

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General evaluation In the investigation of the three multi-hospital systems, it again became obvious how laborious it is to create an effective and efficient vertically integrated system. Although the Irish and the Dutch systems give sufficient attention to differentiation of sub-tasks with reallocation, development, and division of functions, nevertheless, the level of integration is not achieved that would permit the entity to be called a “multi-hospital system” in the true meaning of the theory on such systems. The French system, through the interaction of its parts, succeeds fairly well in achieving a holistic dimension by which the whole becomes more than the sum of the parts. The Irish system can be compared to what Johnson calls “the wobbly three-legged stool”, a collaboration that can at best be called “only a loose fit ” [17]. The way in which participants perceive their own system agrees with this evaluation. In the Irish system, one speaks frankly of frustration and conflict. In the Dutch system, the feelings are rather those of resentment with a certain ambivalence toward the system. In the French system, the participants are reasonably well satisfied, and the situation is described as “un mariage de raison”.

Critical factors Upon further examination, two factors appear to be of primary importance in the creation of a well functioning vertical multi-hospital system. First, there is the establishment of a strong, corporate management. Second, a thoroughly worked out medical staff functioning and an involvement of the medical staff in the decision making for the system determine the success of the system. Both factors emerge clearly from the survey of the three systems and would probably be confirmed in a representative comparative study with a larger scope. Strong management was revealed in the study of the three systems both positively and negatively: the presence or absence of particular management provisions and practices in relation to whether or not the system functions smoothly as experienced by the privileged witnesses. Strong management seems to be dependent on highly qualified and specialized managers being present in sufficient numbers on the corporate level. This must be a management team that is active on both the short and the long term and that has sufficient authority to take the necessary decisions within the appropriate time horizon. These are primarily decisions in which rationality prevails and in which consensus does not necessarily mean unanimity and the course of least resistance or a scrap heap of compromises. A strong medical staff organization means (a) a medical collectivity that is structurally represented in all policy and decision-making organs, including the executive board of the system, (b) participation in the relevant sub-aspects of the policy, and(c) the awareness that the advice of the medical staff is approached positively by the management and not ignored in decision making. In several of the hospitals, the medical staffs have a minimal structure and function. Their place in the hospital structure is vague and incoherent. At the most, they are

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involved in the specification of the constraints for medical intervention and then generally not systematically but rather episodically in reaction to conflict situations. According to Blanton, weak medical staff functioning is a corollary of weak management, which often applies the false reasoning that underdeveloped medical staff functioning is easier to control and manipulate [18]. According to Blanton, there is no alternative for proper medical staff functioning in the development of effective multi-hospital systems. He describes such staff functioning as follows: (a) a formal staff structure specified in writing; (b) consensus between management and medical staff about the objectives and goals of the institution(s); (c) extensive, systematic, and factual information about the operation of the multi-hospital system and the degree to which its objectives are being achieved; (d) the existence of systematically used vertical and lateral communication channels within and between the layers of the system; (e) attention being given to leadership development in addition to the professional qualifications of the medical staff members. There is, of course, no magic formula for proper medical staff organization and functioning. Moreover, it is not inconceivable that the creation of a series of committees and commissions risks being incorrectly identified with proper staff functioning. Connors suggests that medical staff functioning must be situated primarily at the level of the individual institutions with only selective involvement of the medical staff on the system level [19]. This undoubtedly goes together with the fact that his experience is situated mostly in horizontal systems, where the integration of the care function is less intensive. However, a management that ignores the involvement of the medical staff on the system level takes insufficient account of the intrinsic characteristics of hospitals in which the thinking and doing work is done by professionals. The minimization of medical staff functioning as an anomaly in the familiar industrial model is at the very least short-sighted and self-destructive. The Irish multi-hospital system is characterized by an underemployed management where the concern for survival predominates rather than the desire to advance by means of cooperation. As Roach puts it, cooperation between hospitals, however attractive the concept might be, is ineffective if the required management talent is qualitatively and quantitatively underrepresented [20]. The Irish system is at the same time hindered by the principle of unanimous decisions within a very large central executive council. This leads to endless discussions that undermine the competitive position of the system in the region. The Dutch system has a proper management core, but as yet does not seem to have found the right wavelength with the doctors. What is more, the management skill and authority of a few individual institutions equals that of the central level. In this situation there arises a strategy of the “law of the fittest”. High-quality management accompanied by vital and structured involvement of the medical staff is found only in the French system, and this is judged very positively by the various parties. In addition to strong management and an involved medical staff, which were found to be critical factors in the survey of the three multi-hospital systems, there are a number of other factors of a structural or environmental nature that appear to be determinative for whether or not a successful multi-hospital system is achieved.

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System formation: a natural process Multi-hospital systems have more chance to succeed when their development proceeds naturally and spontaneously in close contact with their primary task, namely the providing of care. In the development of the Irish multi-hospital system, priority was given to financial and economic concerns: access to more capital, obtaining more resources, selecting a new location, and so on. Systems thus formed collide after their formation against the critical question: how to accomplish integration and, if possible, synergy among the medical services and functions? In the Irish system, partially because of cultural barriers, one continues to run in place, and as yet no identification with, not to speak of appropriation of, the concept of system functioning has been achieved.

Scope of the multi-hospital

system

Both the situation of the doctors and the manner in which they perceive their position in the multi-hospital system are influenced by the scope of the system. The scope is measured in terms of three characteristics: (a) the number of institutions in the system, (b) the type of these institutions, and (c) their size, i.e., the number of beds per institution. The number of institutions in a system leads to what at first sight seems to be a paradox: the more institutions there are, the higher the degree of integration. One would expect that as the number of institutions increases, the entirety would become more complex and less manageable. Curiously enough, the identification of doctors with the multi-hospital system was higher in the French system, although it contained considerably more institutions than in the Dutch and Irish systems. Of particular significance seems to be the situation where only two or three general hospitals form the backbone of the system. When this is combined with a mediocre corporate management, there is a good chance of crippling rivalry between the hospitals and their respective medical staffs concerning every possible rational reallocation of provisions. This not only strengthens the cohesion within the staffs of the individual institutions, but there also arises a coalition of local medical staffs and their respective managements against the common enemy, represented by another institution or by the corporate management. This situation is obvious in the Dutch system and is experienced there by the doctors extremely negatively. The corporate structure is experienced as a serious hindrance both for the development of the individual institution and for positive competition with the sister institutions. The frustration among the doctors increases because the corporate structure, which in principle should mean more elbow room, operates restrictively. This “sibling rivalry” is, in fact, latently present in any system with a weak corporate management. It is more apt to occur when the number of institutions in the multi-hospital system is smaller. The type of institution is relevant insofar as there are general hospitals and certain types of specialized hospitals. The situation of doctors in these types of hospitals is

determinative for the system and its operation and differs considerably from the situation of doctors in other institutions, such as psychiatric hospitals and rest homes. To the extent that these types of hospitals are present in the institutional balance of the multi-hospital system, the place and role of doctors will take on different forms. has a particular influence on the situation of The size of the individual institutions doctors and their perception of this situation, particularly when there is a great difference in the size of the institutions. When one is very large relative to the others in the system, then a situation easily arises in which the strongest dominates. A strong corporate management can accomplish a redistribution and correction in such a situation if need be. In the opposite case, namely with a weak corporate management, concessions are generally made, if only for fear that otherwise the strongest element will try to go alone. Both the Irish and the Dutch systems manifested this situation. The smaller institutions call the large institution the “spoiled child”. On the other hand, the large institution jibes at the smaller institutions for being “anemic” and says they are kept alive artificially by the grace of the corporate management. In this situation, the doctors have excessive expectations with respect to the corporate management, so that when its weakness enables it to effect only marginal changes in the power relationship, they are experienced bitterly as sops. Reynolds and Stunden observed in systems with institutions of markedly different sizes that an imbalance of power tends to develop between the various medical staffs, which leads to tendentious decision making on the corporate level [2 11. In the literature, it is sometimes stated that the strength of a system lies in the strength of its institutions. This is only partially true. A strong system is generally backed by strong institutions. But strong institutions do not necessarily produce a strong system. On the contrary, a weak system can be artificially kept alive by strong institutions.

The social profile of the individual institution Doctors seem to attach a great deal of importance to the social profile of the institution in which they principally practice. In the Irish system, the member institutions have markedly different social profiles: the socio-economic groups from which they each recruit their patients as well as the social image they project vary widely. When such strong differences occur within a multi-hospital system, it is understandable that reallocation and functional integration are approached with much suspicion by the doctors.

The statute of the doctors In their study on medical staff organization in different hospitals, Getzen state that it is not clear what statute of the doctors, in particular paid, is experienced as the most satisfying by the doctors as well as by the Payment on a fee-for-service basis could lead to over-consumption. The

Shortell and how they are hospital [22]. salary system

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would not be an incentive for over-consumption but still would not necessarily lead to cost-containing behavior. According to Shortell and Getzen [22] doctors on salary are more prepared to devote time to policy activities. This was not obvious in the three multi-hospital systems studied here. There seemed to be just as much interest on the part of the doctors for policy participation both in the Dutch system, which uses the fee-for-service system, and in the French system, in which the salary system predominated. It is not so much the method of payment of doctors as the meaningfulness of the policy participation that is decisive. The acquisition of an income is certainly an important objective for the doctors in a hospital. In a multi-hospital system with limited integration of the doctors in policy formation, income is a continual source of friction. Doctors think that the management exceeds its authority, and management reproaches the doctors for having no appreciation of the economic realities of the hospital. A system such as the French, with a high degree of involvement of the doctors, provides them with up-to-date information on the economic facts, which they, moreover, help to determine. This information reinforces the feelings of security and satisfaction. In each of the three systems there was an explicit desire for legal security on the one hand and definite autonomy on the other. The desire for a juridically watertight social statute goes together with the expectation of free professional practice. In each of the three systems this desire was translated into the maintaining private practice, if possible, off the hospital premises. As arguments are given: (a) preservation of a liberal profession as a value in itself; (b) meeting of the desires of particular patients; (c) maintenance of contact with what happens daily in ordinary practice. In the Irish system, private practice outside the multi-hospital system was, until recently, an absolute necessity because it was impossible to earn the customary income within the system. In the Dutch system, both on the level of the individual institutions and on the level of the system, there was a pronounced tilt of the management against any form of private practice outside of the multi-hospital system. In the French system, both the management and the doctors tended to favor making external private practice possible, although for different reasons. The management considered private practice as self-evident, since 30% of the staff is associated with the system only part-time in addition to a larger group of doctors who provide the primary care of the system via policlinical consultations in the various hospitals. Some of the full-time doctors expressed the desire to return to part-time private practice outside the system. This desire was based not so much on dissatisfaction with their existing situation but rather on an anticipation of deterioration of the general economic situation, which will inevitably affect public institutions and among them the multi-hospital system. In fact, therefore, the desire for autonomy seems to be an extra security mechanism that would serve should the social security statute fail as a safety net.

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The influence of the general environment The way in which the multi-hospital system is situated in its working environment, which in its turn is controlled by the general environment, naturally influences the functioning of the system and the way in which the doctors experience their situation. For several years, the hospital environment and in it, the authorities in particular, encouraged the growth and expansion of the hospital system. Now, the policy has changed, and the intention is clearly on retrenchment. This generates anxiety and uncertainty, particularly now that there is a serious recession, which, of itself, provides additional arguments and legitimation for a demolition squad. This uncertainty was the most apparent in the French system, where, at the time of the study, an historic political shift had taken place with the coming to power of the Socialists on the national level. Curiously enough, this was the occasion for a strengthening of the bonds between the management and the doctors. Both are caught up in the uncertainty of how the government will proceed regarding the funds necessary for the system to operate properly and to expand further. In the French system, there is also a great deal of concern about the new state structures announced whereby the regional authorities will receive more power and will have a stronger control over hospital events and funding.

Cost consciousness The doctor as a cost generator in health care and cost consciousness among doctors are a recurrent theme in the literature [23-251. It is notso much thedoctors’ownincome but the way in which they generate costs by their medical decisions that is significant for the system. To the degree that the funds become scarcer, more efforts are made to suppress costs. System formation is therefore often presented as a possible solution. Up to the present, however, it is not clear how far the multi-hospital system, particularly in its initial phase, actually does achieve the hoped-for cost savings and economies of scale. In the French system, the doctors and the management reported quite positively about cost consciousness and cost-containment alternatives. This system usually applies the following mechanisms: (a) the assignment to doctors of considerable authority to develop and implement policy lines for cost containment; (b) a formal and structured provision of information to the doctors regarding all significant financial and economic information. Nagurney has shown in a study that the cost consciousness of doctors in their clinical decision making increases in proportion to the degree that they are involved in and informed of cost-containment initiatives [26].

The influence of personality

characteristics

Strong personalities are generally to be found in every organization. They form the impetus that can either promote or cripple the harmonious functioning and the

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development of the organization. Leading figures can achieve important results. But their interests are not always parallel or appreciated by other doctors and by the management. For personality characteristics to have a positive influence on the cooperation in the sense of a promotion of integration, there must be a certain balance between the various “strong personalities” and this both in the corporate management and on the medical staff. At the same time, there must be a sturdy managerial structure that can channel the energy of these personalities toward the objectives and goals of the multi-hospital system. In contrast to this, there is the not inconceivable danger in the Dutch system that a number of leading doctors together with a few strong administrators of a particular hospital will soon form a “state within a state”. When doctors with strong personality characteristics feel frustrated in their multihospital system, then there is also the chance that they will join groups outside of the hospital. Thus the so-called “out-of-hospital dynamics” can begin to function and hinder and undermine the policy options of the system.

Shared service units and specialized

hospitals

The literature considers the establishment of diagnostic and therapeutic central units through the system a promising and cost-saving development. In the three systems, however, there are divided opinions and mixed feelings about this evolution. Although the Irish system has a technically perfectly equipped and functioning shared service unit, it cannot sufficiently achieve its integration into the served institutions. This situation, where differentiation prevails over integration, hinders the smooth progress of activities and is rather cost creating than cost saving. A similar problem occurs for the specialized hospitals. The Dutch system is being sharply confronted with the problem of functional integration and functional boundary delimitation of a specialized hospital. The impact on personal relations is great, and frustration and dissatisfaction perpetuate a latent conflict. The French system, which has specialized hospitals that function very well, is now beginning to raise serious questions about the use and relevance of this development.

Conclusion Zuckermann points out a number of possible advantages of multi-hospital systems for doctors. These were investigated and found in the exploratory research: The broader supply of services and programs is more attractive to doctors. This attractiveness declines, however, to the extent that new services are not established in the doctor’s own institution. In short, identification with one’s institution exceeds the attachment to the system. Better referralpossibilities. However, these are experienced negatively if referral for routine matters involves a change of institution. More possibilities for supplementary training and expert advice were evaluated positively.

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As a general conclusion, we can state that the development of multi-hospital systems has occurred more for economic than for patient-care considerations. It is high time that more attention is turned to the integration of care provision and that sufficient attention is given to the organizational structures that effectively determine the medical activity. Medical structures must be designed within which doctors, with an eye to the entity they help to direct, can commit themselves with dedication and enthusiasm. Further, we hope that the present exploratory study of three multi-hospital systems will lead to a systematic comparative study.

Acknowledgement The present study was supported by a fellowship from the W.K. Kellogg Foundation under the auspices of the European Association of Programmes in Health Services Studies.

References I 2 3 4

10 11 12 13 14 15 16 17 18 19 20 21 22

Dowling, W., Multi-hospital systems face growth, constraints, unexploited options, Hospital Progress, April 1983. Barrett, D., Multi-institutional systems. The trend for multi-institutional systems can only go up, Hospitals, April 1982. Zuckermann, H.S., Multi-institutional systems: Promise and Performance, Inquiry, Winter 1979. Brown, M., Multi-hospital systems: Implications for physicians, The Hospital Medical Staff, August 1979. Galbraith, J., Het ontwerpen van complexe organisaties. Samsom Uitgeverij, Brussel, 1976. Lawrence, P. and J. Lorsch, Organization and Environment, Harvard Business School, Boston, 1967. Studnicki, J., Multi-hospital systems: A research perspective, Inquiry, Winter 1979. DeVries, R., Strength in numbers, Hospitals, March 1978. Barrett, D., Multi-hospital systems: the process of development, Health Care Management Review, Summer 1979. Brown, M. et al., The growing multi-hospital system: a sleeping giant stirs, Hospital Progress, December 1980. Connors, E., Multi-hospital systems are changing the health care landscape. Paper presented at the Annual Meeting of the Council for Teaching Hospitals, October 1978. Connors, E., The promise and problems of vertically linked organizations, Trustee, August 1978. Macstravic, E., Many benefits possible with vertical systems, Hospitals, December 1979. Ross, A., Vertically linked organizations hold challenges and opportunities, Hospitals, January 1979. Wilkinson, E., Japan versus Europe. A history of misunderstanding, Penguin Books, London, 1983. Barrett, D., Multi-hospital systems. The Process of Development, Oelgeschlager, Cambridge (Massachusetts), 1980. Johnson, R., Revisiting the wobbly three legged stool, Health Care Management Review, Summer 1979. Blanton, W., A physician looks at board-medical staff relationships, Trustee, June 1979. Ibid. Ref. 11. Roach, W., Hospitals reorganize to survive the SO’s, Hospitals, March 1982. Reynolds, J. and A. Stunden, The organization of non-profit hospital systems, Health Care Management Review, Summer 1978. Shortell, S. and T. Getzen, Measuring hospital staff organizational structure, Health Services Research, Summer 1979.

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Car&, E., D. Neuhauser and W. Stason, The physician and cost-control, Oelgeschlager, Cambridge (Massachusetts), 1980. Remlan, A., The allocation of medical resources by physicians, The Journal of Medical Education, February 1980. Schroeder, S., Physician use of services for hospitalized patients. A review with implications for cost-containment, Milbank Memorial Fund Quarterly, No 4, 1981. Nagurney, J. et al., Physician awareness of economic factors in clinical decision-making, Medical Care, July 1979.