Health & Medical
Corrective surgery
How Claus von Zychlin’s restructuring of Mount Carmel Health System has prepped the organization for future growth
By Nancy Byron
Smart Business Columbus | April 2008
The symptoms were typical of any billion-dollar company that
had started as one primary business and branched out over the
years. The founding concept — in this case, Mount Carmel
Health System’s hospital division — was still revered as the pinnacle of the organization. All other subdivisions, such as outpatient care centers and the College of Nursing, were treated exactly as that: subordinate.
“There was a tendency years ago to have hospital-centric systems,” says Claus von Zychlin, who became president and CEO
of Mount Carmel Health System, a member of Trinity Health, in
July 2006, and quickly diagnosed this long-standing flaw in how
the system was organized. “Our hospitals generate the largest
volume, so a lot of these things became like a department of the
hospital somewhere. They kind of got lost in the milieu.”
That stifled growth in certain areas and caused frustrating mismatches between leadership skills and organizational duties in
some cases.
For example, the education division — which includes the
Mount Carmel College of Nursing as well as the graduate medical
education program that trains aspiring physicians during their residencies — has historically reported to one of the hospital administrators at Mount Carmel.
“At the time, they really had very little knowledge about graduate
medical education, and it really got the attention only when something was broken, not the attention of, ‘Where do we go tomorrow?’”
he says.
To fix these types of problems, von Zychlin tossed out the old
organizational chart and created four new divisions — one each for
education, ambulatory care, managed care and physicians — and
put them all on equal footing with the hospital division. He also
hired or promoted administrators with specific expertise in those
areas to head up each of the five divisions within the $1.1 billion
organization.
“By separating them out into divisions, with each of them having an
executive sponsor, they each have the time and attention they need
rather than being buried underneath some department of the hospital,” says von Zychlin. “That has added to their accountability, their
ability, and, I think, in general, to the psyche of the people who
work there. They realize they’re an actual division that has the
same level of responsibility and visibility as the hospital traditionally had.”
The results have spoken for themselves. Expenses have dropped
by $61 million between fiscal 2006 and 2007, thanks to a systemwide efficiency review. In that same time frame, supply costs
have decreased $1.5 million and Mount Carmel College of
Nursing’s operating performance has improved by 38 percent.
Here’s how von Zychlin’s eye for reorganizing and creating equality and collaboration within Mount Carmel is helping the system
reach new heights.
Expect teamwork
Von Zychlin did not adopt a separate-but-equal philosophy for
Mount Carmel’s five operating divisions. Quite the contrary; he
believes the whole is still greater than its parts, and he expects
teamwork, collaboration and partnerships across all divisions.
After all, the common goal, as with any service-oriented business,
is to increase customer satisfaction.
“We need continuity of care through all levels,” von Zychlin says.
“If you look historically, health care has been rather episodic. If you
are seeking health care, you go to a doctor’s office. That’s one episode
of care. If your doctor sends you to a hospital, that’s another episode.
If he sends you to an outpatient center, that’s another episode of care.
Those episodes or encounters were not very closely linked to each
other in the past. We hope one day to create better and better links,
better continuity between those episodes.”
That means better communication not just within Mount Carmel’s
flagship division — the four hospitals, which traditionally had a lot
of individual autonomy — but also between all the divisions that
could share customers, or patients.
“If a patient registers at Mount Carmel West, then the next time registers at Mount Carmel St. Ann’s, not only will that information transfer with the patient, but key clinical processes and procedures that the
patient may find comfort in will have commonality,” he says.
Commonality in systems and procedures across Mount Carmel’s
divisions can also increase efficiency.
“If you look at how we go about overseeing quality of care, we
track hundreds of indicators,” von Zychlin says. “It’s a whole lot
easier for us to track those indicators if everybody is collecting
data the same way, if it’s reported the same way and if the teams
who work on improving quality of care work together so we’re not
reinventing the wheel.”
Commonality can also save time.
“If, for instance, a physician practices at more than one location,
there is a lot of value in the procedural work and processes we
engage in being the same so the physician doesn’t have to learn different processes at each hospital,” von Zychlin says.
The advantages are enormous — fewer opportunities for mis-communication, less time spent training on procedures and more
time spent with patients — as well as vital to better serving Mount
Carmel’s “customers.”
That said, there is still room for pioneering new ideas within various divisions.
“On occasion, we will pilot something at one of the sites, and if
that pilot seems to be effective, then it can be rolled out to all the
sites,” he says. “So there is also the benefit of the individual initiative and effort.”
Balance your goals
Despite the push for increased uniformity across the Mount
Carmel Health System, the market still plays a role in how things are
done at times.
“You have to be able to recognize the value of interdependence and
recognize the value of market independence,” von Zychlin says.
“When I look at our College of Nursing, I’m looking not only at how
can it benefit Mount Carmel Health System, but how does it benefit
nursing education and the growth of nursing education in the region
that we serve. I can’t just look at how it will help me fill my nursing
vacancies; I also have to concentrate on how it can be responsive to
its students and the community that needs more nurses. How do we
take it to the next level?”
That’s where having the head of Mount Carmel’s College of
Nursing reporting directly to von Zychlin — rather than two levels
removed from him — comes in handy. Ann Schiele, president and
dean of the college, now has the resources and attention she needs
to constantly look ahead to what’s next, stay competitive and, by
doing so, help the system as a whole.
“Can we build into the curriculum and the practical, clinical experiences a way to show how doctors work with nurses in partnership
and nurses work with doctors in partnership rather than just training
nurses to be nurses and doctors to be doctors?” von Zychlin says. “We
can take it beyond just the corridor of training in their respective professions.
“We have lots of ambulatory sites. Does it make sense to open
nursing education into those sites and create a broader experience? Same thing with physicians.”
The winners in all of this, again, are the customers. With better,
multifaceted training upfront, nurses are apt to adapt more quickly to any medical environment in which they are called to serve.
Therefore, patients should receive better care.
“Those are some of the things we are looking forward to in creating the synergy between the hospitals and the College of Nursing
and graduate medical education,” von Zychlin says.
Still, it’s a continual balancing act.
“You have to be able to weigh internal benefit with external benefit,” he says. “If you concentrate too much on the outpatient or
external side, then you have to question what’s the value of having
that division as part of your health system. Does it add value?
Because it takes management time, it takes capital, it takes lots of
things; so if it can’t add to the value of the system and all it’s doing
is external, then you have to really question whether that division
makes sense for you to have or not.
“Vice versa, if you only concentrate on how it supports your
organization, you may lose the value and quality of the best students and its success in the community. If students perceive us as
being 100 percent internal-focused around how do we fill our own
vacancies, then they’re going to say that doesn’t give me the broad
experience I’m looking for as an individual nurse for my future
growth and career path. So we have to look at it and say, ‘How can
we do both?’”
Evaluate your progress
Although the organizational chart has been modified and the mission of cooperation between divisions has been clearly set, there’s
still plenty of monitoring and evaluating taking place. There
always will be.
“This is a journey,” von Zychlin says, adding that the role of technology in the ever-changing medical field is likely to have significant
bearing on how to best create operational efficiencies under the
new, five-division internal structure at Mount Carmel.
“I have it as a priority that we are looking at things in a systematic way,” von Zychlin says. “What’s the best way to provide this
particular service? Does it make sense for it to remain specific to
the individual sites with some oversight? Or does it make sense to
consolidate it into a single department that operates at four different locations or more? What makes the most sense from a quality
of practice standpoint? Is it more cost-effective one way or the
other? I suspect sometimes we’ll consolidate and find out that the
market or technology has changed, and it might make more sense
to decentralize again.”
Take, for example, the medical laboratory.
“Rather than duplicating expensive lab equipment, it’s probably
better to consolidate certain components of the lab and get critical
mass at one site,” von Zychlin says. “If you look at today’s world,
with digital equipment, once you get the sample to the lab, reporting back out is instantaneous because it’s done by a computer. But
technology changes. As it does, we will determine whether it still
makes sense to centralize or whether it needs to be reconsidered
for decentralization.”
Even if decentralization ends up as the best choice in the long
run for certain services at Mount Carmel, that doesn’t equate to
complete independence.
“For me, it’s more around coordinated and decentralized or centralized,” he says. “I can’t think of anything that is so decentralized
that there’s no coordination going on.”
Whichever way the pendulum swings at any given time in the
future, the ultimate goal will remain clear.
“If you look at the core or genesis of it, it is patient care,” von
Zychlin says. “We are a people business.”
HOW TO REACH: Mount Carmel Health System, (614) 234-5000 or www.mountcarmelhealth.com
