Hospitals In Focus

Hospitals at Scale with Jeff Goldsmith


Hospitals are not just the four walls of a building; they are also the backbone in an American community. As the pandemic continues across the country, Chip and Jeff Goldsmith examine how hospitals learned to treat a disease without a proven cure or readily available therapies. They also spoke about what characteristics were displayed by hospitals that demonstrated successes during the past 18 months of this COVID-19 crisis. Jeff is the President of Health Futures, Inc. The two discuss the benefits of the ever-evolving hospital as well as its changing role in health care.

Speaker 1:                           Welcome to Hospitals In Focus from the Federation of American Hospitals. Here’s your host Chip Kahn.

Chip Kahn :                          Over the stress times of the COVID-19 pandemic, the nation has suffered a tragic loss of life. That loss as well as the medical, social, and economic effects of the pandemic are unfathomable. But there are two bright spots which we [00:00:30] should recognize where American healthcare performed exceptionally. First, the miracle of vaccines is a historic accomplishment for the pharmaceutical industry. And second, one worthy of commendation is the manner in which our caregivers and the hospitals where they work rapidly innovated and adopted treatments that clearly mitigated the effects of COVID-19 for millions of patients. We must acknowledge how they were able to save lives under difficult conditions, [00:01:00] without a proven cure or readily available treatment pathways.

The hospital response in no small way, can be attributed to the evolving hospital organizations that displayed all the advantages of scale in confronting the challenges of the pandemic and the extremely sick patients who depended on those hospitals for life-saving care. The role of the hospital organizations at scale and the implications of that scale are what we will examine today. Joining [00:01:30] me on the podcast is Jeff Goldsmith, who has spent his lengthy career thinking, writing, and advising on strategies to optimize hospital care and organization. His insight over time makes him the ideal person to discuss the evolving role of the hospital in patient care and the impact of COVID-19 on care delivery. Jeff, I’m so happy to have you with us today.

Jeff Goldsmith :                 Chip, it’s great to be with you.

Chip Kahn :                          To get started Jeff, would you tell us a bit about your [00:02:00] career and background?

Jeff Goldsmith :                 I did my graduate work at the University of Chicago. I got an academic doctorate in sociology in 1973. I went to work for the governor of Illinois. I worked in the governor’s office for a little over three years and then went to the academic health center at the University of Chicago on the south side of Chicago for the next eight. I did a lot of writing about the health system and where it was headed, particularly in the Harvard Business Review. And in 1982, launched a career in strategy consulting, which [00:02:30] continues to this day.

Chip Kahn :                          Jeff, putting the role of the hospital in perspective and considering the pandemic, what were the characteristics of today’s hospitals that enabled their performance over the past 18 months under such terrible and stressful circumstances?

Jeff Goldsmith :                 Well, I think the health systems in the cities that were hit first by COVID, you think about Detroit, New York metropolitan area, New Orleans, health systems in [00:03:00] these communities were able to coordinate care across an entire region, across multiple facilities. And to make decisions quickly about where patients could best be seen, stood up testing capabilities when public health outlets were not able to do so and were able to coordinate how their facilities operated to be able to manage the surge of hospital patients that hit them in the late winter and spring of 2020. It was [00:03:30] a remarkable performance.

Chip Kahn :                          What are the major features of the evolution of America’s healthcare that have defined the direction of hospital care today? And what’s the developing or current role of the hospital? What are the advantages and disadvantages of these developments?

Jeff Goldsmith :                 Those are a lot of interlocking questions. In the late 70s and early 80s when I entered the health system, hospitals were almost 40% of total health spending and for better or worse, because we lacked elaborate public health [00:04:00] resources of a lot of other countries. The hospital became the de facto pivot point of care systems in most communities. In some cases like New York, Los Angeles, and Chicago, there were large public hospital systems with clinics that were sort of there before. But in the 70s and 80s, we saw both in the investor owned and non-for-profit world, the growth in multi-hospital systems that were able to span regions and to both plan and deliver care at scale [00:04:30] across large metropolitan areas. And that development, that is the development of regional health systems has continued pretty much unabated to this day.

Chip Kahn :                          Jeff, what do you see as the trajectory for our hospitals considering the point you just made and what will define the future role of hospitals, hospital care and healthcare? How will hospitals fit into your vision of what will happen to healthcare in America?

Jeff Goldsmith :                 When I began my consulting work in the early 1980s, the central [00:05:00] question that a lot of my clients were asking, a lot of those were on the Pacific coast were, how do we compete with organized care systems like Kaiser that were capitated and that were built around or supported HMO’s? So a lot of my consulting work during that first two decades was about creating entities that had primary care access points, that had clinical enterprises that were spread across a metropolitan area or a region. [00:05:30] And that had multiple layers of care so that you didn’t have to rely on expensive acute care facilities as the sole resource for taking care of patients.

And I think that template of a multi-layered system that stretches across the region and that is animated by a large clinical enterprise, I think is sort of the emerging template of the care system in the country. And I want to add that there’s a lot of controversy about this development, but the reality [00:06:00] is that policymakers going back to Richard Nixon’s administration have actively encouraged the formation of these systems because they wanted to use them as the pivot point for changing how care is paid for.

Chip Kahn :                          We’ve seen several rapid developments during the pandemic and the technological miracles of the last few decades when it comes to technology, treatments, and supply chain. For example, what of these new developments do you think have staying [00:06:30] power from what’s happened over the last 18 to 24 months?

Jeff Goldsmith :                 Certainly the development that’s gotten the most press has been the unfolding of tele-health, not only telephone physician consultation, but also zoom and video consultation. I do believe we are going to see this as an enduring feature of the care system. It was very difficult to get adoption of these modalities at scale, they’ve been around for two decades. But when hospitals [00:07:00] were compelled to shut down elective care during the spring of 2020, they stood up telehealth access in remarkable speed, weeks in many cases. Even though the pressures on health systems waned during the summer and fall of 2020, those telehealth operations continued to have a lot of robust use, particularly in behavioral health. And I think behavioral health is an area where we really need to make progress in [00:07:30] improving access. And I think telehealth is going to be very important there. I also think that many of these health systems, I’m thinking about New York Presbyterian and Northwell that’s based in Long Island, but it’s really all over the metropolitan area, stood up command centers that enabled them to visualize the capacity and staffing levels in their institutions across the system.

And to really manage them as if they were a system. I think those command centers prove their worth during this period [00:08:00] of time and were immensely valuable in making sure that if a given facility didn’t have staff, that staff were redirected to it, that if the emergency rooms were overflowing, that alternatives were made available to people. I think those command centers are also going to be an enduring feature of healthcare organization. They were so valuable. And I think as well, this idea of being able to do testing, viral testing across a region using the clinics, and in some cases, [00:08:30] emergency facilities of hospitals is going to be inevitably a part of the future response that we mount to future pandemics. Those are the three big ones Chip, that I see.

Chip Kahn :                          I’m going to add as a backup to your point, these command centers to be successful, have to have troops to command. And one of the things we found early on in the surge and we’re finding in current surge is that staffing and workforce [00:09:00] generally is a problem. We don’t have enough staff. How do you see this issue, which really can’t be resolved in the short run, but has to be resolved in the longer run. How can we come to grips with this? Because these complicated, sophisticated hospitals that we have with sick patients of maybe the future of this pandemic or the next pandemic need to have the staff to make the place work. What can we do to resolve this issue?

Jeff Goldsmith :                 [00:09:30] When you think about the strategic challenges that are facing hospitals and the health system generally, the workforce just loons over everything else. When we entered the pandemic as a society, hospitals and other healthcare organizations were overly dependent on baby boomers. The average age of people’s nursing staff, the average age of people’s primary care physicians in many communities was in the high 50s or low 60s. And I think [00:10:00] the stress of the pandemic accelerated what we would’ve seen in any case, the retirement of a lot of those folks. We did not have enough troops coming through the pipeline to be able to replace them.

I can tell you, I think one thing the pandemic has done is that it has highlighted how much stress and pressure exists just in normal care operations that affects the emotional and mental health of people that we count on to take care of us. And [00:10:30] there was a lot of discussion about the term burnout and a physician friend of mine said to me, we talk about burnout because we can’t talk about mental health as a priority for the care workforce. I think a fundamental shift in the culture of these places is going to be needed so that we take into account and respond to the human stresses and pressures that not only COVID, but normal operations it placed on people that we have frankly [00:11:00] taken for granted. And we’re going to have to give them permission to tell us that they are stressed, or anxious, or depressed, and we’re going to need to not only not stigmatize or punish them, but actively encourage them to get care and to provide them the care that they need so that they can be effective and work a longer and more satisfying and more human career.

I think one very important consequence of the pandemic is going to be the need to change the culture of caregiving in [00:11:30] these places to make it more, I think the word forgiving and more human. I think it’s just the only way that we’re going to be able to retain the workforce that we need as the rest of the baby boom generation inevitably retires.

Chip Kahn :                          I think we can conclude from our conversation today, that hospital organizations at scale were what was needed to meet the challenge of COVID-19 and really were assets for patients and communities [00:12:00] and meet a public purpose. How can we get the best from hospitals and health systems to maximize their social benefit in your view?

Jeff Goldsmith :                 One of the things that’s really troubled me about the dialogue and the policy community and in academia about hospital systems has been this overwhelmingly negative view that the creation of these systems is principally about pushing up prices. I don’t believe that the size of a health system is [00:12:30] the relevant measure of the social benefits or potential concerns that the organization creates. They’re not only bigger, these incentive systems, but a lot more complex. They’re not just a bunch of hospitals run as a conglomerate. They’re care systems that are capable of producing benefits far beyond unit cost reductions.

And I think we’ve got to begin asking, well, what are those potential benefits? I think there’s a number of them. I think these [00:13:00] organizations, whether they have health plans attached to them or not can reduce the total cost of care by coordinated and better targeted primary care, by the use of extensivists, which are internists and advanced practice nurses that work with high-risk people in the communities, home-based interventions, there are a ton of things that these systems can do with this complex, diverse and geographically dispersed workforce that actually do reduce the total cost of care.

And I think [00:13:30] it’s appropriate to begin asking, are they really using those capabilities effectively? A second one I think that’s really important is the ability to ameliorate some of the social determinants of health, particularly poverty, homelessness, and filling the mental health gaps in our communities. This can’t be accomplished by an individual system, even a large system, like an Inova or a University of Virginia, here in Virginia can’t do it by themselves. They need to do it in collaboration with people that they’re competing with [00:14:00] on other services, as well as broad based collaboration with public health organizations. In the state of California, there’s been a spectacular reduction in maternal mortality rates because hospital systems were able to work with community-based agencies and community health centers to identify high risk mothers that were in danger of potentially having a problem when they gave birth and a significant reduction in maternal mortality. That wouldn’t have happened without the collaboration of hospitals.

[00:14:30] I also think the idea of improving the patient experience. Many hospitals and health systems have stood up digital front doors, where you can interact with the health system from home or from your smartphone. Building care protocols, pushing care into the home, reducing surprise billing and out of network utilization. These are a lot of that can be done that can be measured that improve the patient experience, which you can ultimately measure through the hospitals HCAHPS [00:15:00] scores or the net promoter scores.

And then finally, apropos of what we were talking about earlier, improving the caregiver experience, which was sort of the quadruple aim, the fourth aim that Berwick kind of added later. The idea of improving scheduling so that people with children can continue working and not sacrifice their responsibilities as parents. Developing career ladders that expose people to multiple roles. So ultimately identify potential future health system [00:15:30] leaders. Involving direct caregivers in healthcare redesign, as well as some of the things we mentioned earlier, reducing burnout, being attentive to the mental health challenges that staff face that have a consequence of reducing turnover and improving clinician engagement. These are all things that health systems can do at scale if they are organized to do so. And I think if we’re to get the benefit of these systems, it isn’t going to be by changing incentives. [00:16:00] It’s going to be by recognizing the power of these organizations to really move out into a community and region and fundamentally affect the health of their populations.

Chip Kahn :                          Jeff, thank you for being with us today. Your insights were so informative and I’m sure it will be extremely useful for our audience.

Speaker 1:                           Thanks for listening to Hospitals in Focus from the Federation of American Hospitals. [00:16:30] Learn more at fah.org. Follow the Federation on social media at @FAHhospitals, and follow Chip @Chipkahn. Please rate, review, and subscribe to Hospitals In Focus. Join us next time for more in-depth conversations with healthcare leaders.


Jeff Goldsmith is the President of Health Futures, Inc.   For eleven years ending in 1990, Jeff Goldsmith was a lecturer in the Graduate School of Business at the University of Chicago, on health services management and policy. He has also lectured on these topics at the Wharton School of Finance, Johns Hopkins, Washington University and the University of California at Berkeley. Jeff Goldsmith’s interests include: biotechnology, health policy, international health systems, and the future of health services.

From 1982 to 1994, Jeff Goldsmith served as National Advisor for Healthcare for the firm Ernst and Young, and provided strategy consultation to a wide variety of healthcare systems, health plans, supply and technology firms. Prior to 1982, he was Director of Planning and Government Affairs at the University of Chicago Medical Center and Special Assistant to the Dean of the Pritzker School of Medicine. From 1973 to 1975, Jeff Goldsmith worked in the Office of the Governor, State of Illinois as a fiscal and policy analyst, and Special Assistant to the State Budget Director.

Jeff Goldsmith earned his doctorate in Sociology from the University of Chicago in 1973, studying complex organizations, sociology of the professions, and politics of developing nations. He graduated from Reed College in 1970, majoring in psychology and classics, earning a Woodrow Wilson Fellowship for graduate study in 1971.

Jeff Goldsmith was the recipient of the Corning Award for excellence in health planning from the American Hospital Association’s Society for Healthcare Planning in 1990, and has received the Dean Conley Award for best healthcare article three times (1985, 1990 and 1995) from the American College of Healthcare Executives. He has written six articles for the Harvard Business Review, and has been a source for articles on medical technology and health services for the Wall Street Journal, the New York Times, Business Week, Time and other publications. Jeff Goldsmith is a member of the editorial board of Health Affairs.

Jeff Goldsmith is the father of two sons and a daughter.  He is an avid snow skier and collects Native American art and artifacts.  He is married to Karen Walker, a florist in Charlottesville, who owns Hedge Fine Blooms, specializing in fresh flowers and cutting edge floral design for businesses, weddings and events. Jeff Goldsmith is a native of Portland, Oregon and lives in Charlottesville, Virginia.