Arlington, Virginia

Monday, August 21, 2000

Mr. Lawrence: Good evening, and welcome to the Business of Government Hour: Conversations with Government Leaders. I'm Paul Lawrence, a partner at PricewaterhouseCoopers and the co-chair of the PricewaterhouseCoopers Endowment for The Business of Government. The Endowment was created in 1998 to encourage discussion and research into new approaches to improve government effectiveness. Find out more about the Endowment by visiting us on the Web at endowment.pwcglobal.com.

The Business of Government Hour focuses on outstanding government executives who are changing the way government does business. Our special guest tonight is Dr. Thomas Garthwaite, Acting Undersecretary for Health at the Veterans Health Administration.

Recently, the PricewaterhouseCoopers Endowment published two reports on the VHA. The first is called "Transforming Government: The Revitalization of the Veterans Health Administration," and the second, "Transatlantic Experiences in Health Reform: The UK's National Health Service and the U.S. Veterans Health Administration."

Tonight, we want to find out more about the VHA's transformation and reform. Welcome, Dr. Garthwaite.

Dr. Garthwaite: Good evening, it's a pleasure to be here.

Mr. Lawrence: And joining us in our conversation is another PwC partner, Greg Greben. Welcome, Greg.

Mr. Greben: Good evening.

Mr. Lawrence: Well, Dr. Garthwaite, as Acting Undersecretary for Health, you're the chief executive officer of the VHA, the nation's largest integrated health care system. Can you tell us about the VHA?

Dr. Garthwaite: Sure. The VA is strikingly large - it has a budget of about $19 billion, and provides health care to veterans through approximately 180,000 staff, 172 medical centers, over 650 ambulatory care and community-based clinics, 134 nursing homes, 40 domiciliaries, 206 readjustment counseling centers, and various other facilities.

In addition to its medical care mission, we provide a significant amount of graduate medical education and it's said that over half of the doctors in America have had some part of their training in a VA facility.

In addition, we're one of the nation's largest research organizations and do approximately $1 billion in combined research across the country. And finally, we back up the Department of Defense and the National Disaster Medical System in times of emergency.

Mr. Lawrence: Your career with VA is quite long, dating back to 1976, what changes have you observed in the 25 years?

Dr. Garthwaite: I even did a little bit of my residency training in VA, so it goes back slightly further than that. It's interesting to think about all the changes in medicine during that time and the changes in VA.

Clearly, the VA used to be predominantly an inpatient health care system, and over the last 20 years, but especially in the last five years, we've moved to provide a significant amount of care in the outpatient setting. At one time, about 30-some percent of our surgical procedures were done in an outpatient setting; we're closing in on 80 percent of our surgical procedures as an outpatient.

We've gone through changing reimbursement schemes. When DRGs came in the private sector and Medicare in the mid-'80s, about a year after that, the VA adopted a reimbursement scheme.

It was originally called Resource Allocation Model, it became known as RAM. And it worked variably well, I think, in the VA, but ultimately kind of pushed us to do too much with too little. We were just dividing up a fixed pie.

We've gradually emerged to a reimbursement scheme that mirrors managed care. We used a larger population base capitation model and that has allowed us to move some dollars around the system and put it more appropriately where veterans live.

We certainly had to adapt to the use of technology and that's a constant across all of health care. A unique part of the VA, I think, has been the emergence of health services research in VA and what we've done in the last few years is try to push health service researchers to communicate better with managers.

You know, managers make a lot of very important decisions and control a lot of dollars and do that with relatively imprecise data often - data that's not subject to statistical scrutiny.

Health services researchers carefully analyze the data, design experiments, apply rigorous statistics, publish it in a journal and often it sits in the journal for many years before anyone acts upon it.

We didn't think that either of those was the ideal state. We really thought that managers should use as much statistical and analytical rigor as researchers and we didn't think researchers should find out important things and not have them acted upon. And we really worked hard to drive together health service research and management and have several major initiatives along that regard.

Another thing that we've done, that I've noticed changing dramatically in the VA, has been the emphasis on prevention. Years ago, I think we waited until the end of a disease and we came in with tubes and scalpels and tried to save the patient at the end-stage of an illness. Last year, we had immunization rates approaching 90 percent for pneumonia and influenza and we believe that in patients who have lung disease, and who are elderly, that every time we give a shot, we not only save lives and prevent hospitalizations, we save $294 with each shot that we give.

So there's a dramatic evolution from care at the end of a disease towards care across -- all the way from detection and prevention of disease, all the way through more aggressive treatment.

The final thing that's I think really dramatically different in the years that I've been in the VA is the emergence of information systems and the VA's really been a leader in information systems dedicated to patient care.

You know, we didn't have to bill for many years, so in the private sector, the computer systems were developed and maintained primarily around billing. Since we weren't billing, we developed and maintained them primarily around the delivery of health care. And if you think about it, ultimately, the most effective and efficient and the highest quality way to deliver health care would be supported by good informag systems around the process of delivering care. So I think we're a little ahead there.

Unfortunately, we had to begin to bill and so we're catching up with the private sector in how to bill, but I think we're ahead in how to use computers to deliver care.

Mr. Lawrence: You served as the chief operating officer of VHA during the greatest period of transformation in the organization's history. Could you tell us about the challenges and the results of this transformation?

Dr. Garthwaite: If you can imagine walking into probably the second-largest bureaucracy in the United States government; at the time we had 205,000 employees and ran a system that was largely centralized, that is, policy came from Washington and although we originally, I think, had some input from advisory groups in Washington, a lot of this was centrally driven policies.

When Dr. Kizer came in and I joined him as his deputy, one of the key underlying tenets of the reorganization and transformation of VA was to decentralize. We believed that, although the broadest policies had to be set in Washington, the implementation of those policies almost certainly has to occur much closer to where the action is out in the field. And although we can see the major policy decisions, the implementation would be quite different in the Bronx than it might be in Boise.

So that was really a challenge. And to do that, we reorganized into 22 networks and each network, then, was responsible for not just the facilities, but the people, the population we were covering within those geographic areas.

That's really a critical change, as well. In the past, it was competing facilities; each trying to have all the programs that were possible in medicine; each trying to have the tertiary care; each trying to have the latest-and-greatest technology. But what was missing was the coordination of care and the preventive medicine, the primary care for the rest of that population before they needed that tertiary care.

So, in the end, what we were able to do was to refocus all of our staff on the concept that it is really about that population, not about the facilities. Now, I don't say we're 100 percent there today, but we've come an awful long way. That is really one of the fundamental tenets.

That also changed us from specialty care to primary care. It changed us from inpatient care to outpatient care. It changed us from end-of-disease care to prevention. So it had dramatic effects just going from a facility-based organization to a population-based organization.

The real key to the change, I think, in making it all happen was the use of performance measurement. And the use of performance measurement did several things for us. One, it forced us to have conversations about what's most important, what the real goal is. Secondly, it forced us to then say, what would be a measure of that. And, third, it said what kind of progress have we made? It gave us an opportunity to chart our progress towards those goals. So, I think, more than anything else, performance measurement really led to the dramatic changes we've seen.

Mr. Lawrence: Interesting. Well, it's time for a break. We'll be right back with more of The Business of Government Hour. (Intermission)

Mr. Lawrence: Welcome back The Business of Government Hour. I'm Paul Lawrence, a partner at PricewaterhouseCoopers and tonight's conversation is with Dr. Thomas Garthwaite, Acting Undersecretary for Health, Veterans Health Administration.

When we closed out the last segment, Dr. Garthwaite, and I wanted to get your perspective on 25 years of government service, what qualities have you observed as key characteristics of good leadership?

Dr. Garthwaite: Well, I guess the thing that stands out to me is, the quality of a good leader is to have clarity of vision, because if you don't have clarity of vision, it's hard to develop a shared vision with all the employees of the organization. I think if you don't have a shared vision with all your employees, you can only get them to go part way towards any goal.

I mean, we really only go where we believe we want to go. We can be ordered to go someplace, and we'll go reluctantly if there's enough of a power structure there, but when we really go enthusiastically somewhere, it's because we see the goal, we agree with that goal and that vision, and that's how we get there. So, to me, the first part is to really have that clarity of vision.

I also believe that people need sound principles and integrity, I think that's a critical piece because no one will follow anybody they don't believe in, and I think that's another critical piece.

Finally, the ability to listen. It's impossible to know everything, but in an organization of 180,000 people, for instance, we have somebody who has a good idea about almost everything. The hard part is to listen. You can find a lot of people who will be quiet while you're speaking, but you find relatively few people who actually listen to what you have to say, incorporate that into thinking and then turn it into a true dialogue with you.

So, I think that's another key piece of leadership, especially in today's society, which I think is moving from a kind of hierarchical command and control structure to more integrated and virtual organizations and more democratic leadership.

Mr. Lawrence: We discussed earlier the reorganization of VHA into the 22 veterans integrated service networks. How do these networks operate and make decisions and what have been the results of this reorganization?

Dr. Garthwaite: It depends a little bit on where you sit, how you believe how they operate. We believe that we've given them a significant amount of authority and control to operate relatively independently. We give them broad national policy. We occasionally step in and try to guide them back on the straight and narrow.

Others haven't been quite as complimentary as that. I think the Congress has been a little concerned that there's a little too much authority and independence. But my take is that they've done very well, given the rapid evolution of an entirely new structure.

One of the things I think has helped us a lot in moving forward the networks was that during the early implementation, and even to this day, we meet frequently. We have a monthly leadership board meeting with the key headquarters leadership and the network directors, all 22.

We did that monthly, in person, for the first several years, and I think that helped minimize the competition and maximize the collaboration. I think it helped each learn from each other's mistakes and implementation difficulties. I think that really allowed us to do reasonably well in the implementation networks.

Mr. Lawrence: VHA places a strong emphasis on patient safety and has created four patient safety centers of inquiry. Could you tell us about these centers?

Dr. Garthwaite: Sure. The centers are really part of a comprehensive strategy in patient safety. Probably three or four years ago, we looked at what was happening in health care and challenges we had in providing consistent care across all the facilities that we operate and began to take on a systematic approach to improving outpatient safety, which included an advisory group to help set up the program; a center for patient safety; a handbook; a mandatory reporting system; the Centers for Patient Safety and, more recently, a voluntary reporting system.

The Centers are looking specifically at what we can to do to engineer in safety in health care. And they look at things from human factors analysis - Do we have enough people? Are they overtired? Are the machines too confusing? Are they designed to be easy to use or is a mistake almost inevitable based on the design of those things?

In addition, we're looking at things like the role of the environment on worker performance; things like simulations. We have an anesthesia simulator in Palo Alto, where a team from an operating room can go in and this simulated patient can have all sorts of difficulty and even die in front of the doctors and nurses, if the right actions aren't taken. Now, when I say die, I mean, figuratively. But you can simulate almost everything and you can watch and even record on TV all the interactions of the people and the kind of things they need during an emergency and whether they're there.

It's really led to some, I think some important understandings about how teams work together; how teams function in emergencies; and how to provide the needed tools to respond to an emergency in a better fashion than they would when they started the simulations.

In addition, we can also see if people are up to date on their training, know what to do and whether our training needs to be modified to improve that. So, a lot of exciting research and actions being taken in the patient safety arena.

Mr. Lawrence: Related to the area of patient safety, VHA recently launched a three-year $8.2 million program to set up a system to reduce medical errors in conjunction with NASA. Can you tell us more about this?

Dr. Garthwaite: NASA for years has run an aviation safety reporting system, which seeks to minimize the personal inhibitions to reporting close calls or actual errors.

It's been found that if you're involved in an error, an adverse event, or a close call, you make a mistake. You're inhibited by a fear of the consequences if you talk about that. You're also inhibited somewhat by the shame of having to admit you made a mistake. So there's a series of reasons that people aren't quick to point their mistakes.

But most people would like to see the systems get better. They would like to see the situation they found themselves in where a mistake was possible, be fixed. And so, it's been found that if you can make the culture right, the people will readily report anonymously the situation that led to this near miss or this adverse event.

That's what we're setting up with NASA. If something happens, you give the wrong medication, but no one was injured but you know they could have been, you can write that up. You have your name and phone number on there. You send it in to NASA; NASA will call you back and make sure they have the story right, so they can interpret it. They will tear your name off and they'll send that back to you.

Then that information about that event is entered into a database, it's computer searchable and NASA has set up computer programs that have allowed them to look for patterns in this description of these adverse events in aviation and we'll be able to use that programming expertise in medical care, as well.

So we're real excited about this. We think it will be the perfect complement to our mandatory reporting system where an actual adverse event did injure a patient and where we need to get to the root cause of that.

In addition, we'll have this voluntary reporting system that will get to near misses, minor adverse events that might otherwise go undetected and allow us to identify as many possible vulnerabilities in the system so we can get about the business of fixing them.

Mr. Lawrence: Well, it's time for a break. We'll be right back with more of The Business of Government Hour. (Intermission)

Mr. Lawrence: Welcome back to The Business of Government Hour. I'm Paul Lawrence, a partner at PricewaterhouseCoopers and tonight's conversation is with Dr. Thomas Garthwaite, Acting Undersecretary for Health, Veterans Health Administration and joining me in the conversation, another PwC partner, Greg Greben.

I wanted to close on one last thing we were talking about in the last segment, which is, one of the innovations under discussion at VHA is Web pages for individual patients to store their medical information electronically in a single place and I'm wondering about the hurdles that need to be overcome before that becomes a reality.

Dr. Garthwaite: Our vision is that the only person that really owns the complete medical record is the patient and the people the patient gives permission to own it. So that, as the VA health care system, we would have all the records on an individual that we had created during our care for the patient; anything they ask us to use in the assessment of their care and the delivery of their care.

Once you make that sort of leap into the patient owns the record, then you have to start talking about how do you, where does he store it, or she store it?

Our vision is that we might help provide veterans that opportunity of a place to store it, especially for the patients that use us for the predominant part of their medical care. So we see a Web page or something like that, a very secure place where electronically the data can come together and where the security is tightly controlled and where the access is controlled by the patient's wishes.

We call that Healthy Vet for the main Web site area, where they can get health information and have their records stored, and right now using the name Healthy Vault for where it's stored, because, in a way, we want to think the medical record as stored every bit as securely as your money and your other valuables.

So that, to us, is a key piece of future. The neat part about this is, once you have your medical record electronically, then instead of this very hard to read, nonstandard information on paper, you now have something that you can analyze much more readily; that you can share much more readily; that you can get a second opinion on much more readily. And you can begin to group together with other patients and look across patients inwardly at the health care system and ask what kinds of quality outcomes does that health care system have.

So when I talk to people about the revolution in the electronics and information in health care, it's not so much just about the fancy stuff people can do, which is, move or do telemedicine, and teleconsultation and a variety of other things.

I think the real revolution will come when the patients own the record and can band together and hire somebody to help them pick the providers, because suddenly, for the first time, capitalism will really rain down and health care will force people to provide quality that they can demonstrate and not demonstrate to themselves or to an accrediting body, but demonstrate to a group of consumers who are looking in at them. That will, I think, dramatically change for the better, our health care system.

Mr. Lawrence: Well, what about the privacy concerns of having all that information? I imagine that's a big hurdle to overcome.

Dr. Garthwaite: I think privacy concerns are a hurdle but I think they're much less of a hurdle, if you go into it with the fundamental belief that the patient owns the data. So that the patient wouldn't join a consortium that they didn't want to.

The patient's data wouldn't go to a pharmaceutical company to market to them their newest products. It wouldn't go to a health care organization just because they had contact with a health care organization. You'd have to specify that you want to share all your record with that health care organization.

And so, if the patient owns the record, I don't think that it will get out of whack. It's when the hospital sells to the pharmaceutical company who then comes back and markets their medications and begin to sell these databases for other reasons that there are really going to be concerns, or if someone from an insurance company can come in and exclude from coverage people who have certain diseases or conditions.

I think those kind of things are the fear that drive the privacy concerns. As long as the patient owns that record and the other people that have parts of that record aren't allowed to sell that information off, I think the rights and privacy of the patient can easily be protected.

Mr. Greben: We've discussed some of the complexities of VHA: The sheer size, the number of facilities, et cetera, as well as the various missions: medical care, medical graduate education, and research. How do you manage such a complex organization?

Dr. Garthwaite: Wish I knew. Well, you obviously have to get a lot of people involved and we've tried a couple of things. We've tried to hire the smartest people we could from wherever they are. In the past, the VA was, I think, guilty of being a little insular and hiring from within. We have hired whoever we could find we thought could do the best job. So, we've hired a significant number of our leaders from outside the VA and I think that's been helpful.

A second piece that I think is helpful in management is the development of the performance measurement monitoring system. We've been able to focus people on key measurements that we think really reflect our progress, both as facilities but also as a larger system.

By picking things to monitor and to measure that are critically important to patients, we've turned the focus of what your job is from the old days, where it was kind of impressing the person higher than you are in the hierarchy to now making some measurable change in the life of a veteran, their immunization rates, their surgical mortality, the number who are put on aspirin and beta blockers after a heart attack. You go down the list, the customer or patient satisfaction scores for your facility.

All those things that we measure, you're going to have to change how you do the process of care and make it better to make them change. So that's made for a lot of focus in local facilities and nationally, on how to make that happen, which is all about the process of delivering care and I think it's made us a much better organization.

Mr. Lawrence: How does VHA attract, hire, and retain top performers, especially in the area of quality health care?

Dr. Garthwaite: Well, that's getting harder and harder. One thing we have on our side is we have a wonderful mission. It's pretty noble to take care of America's heroes, do research, train tomorrow's health care providers. But altruism only goes so far, if the salary structure isn't any good. So we've tried to make sure that our salary is the best that we can make it within the current legislative mandates that we have.

We also try to challenge our employees. We want them to feel like it's fun to come to work. We want them to feel that it's challenging to come to work, that it's a good thing that they have a noble mission.

We'd also like them to believe that, for working with the VA, they will grow as professionals and as people, that they will have an opportunity to learn things and at their level of confidence and the things that they know that are marketable inside the VA, and outside the VA, will grow as they've come on.

I would say we have a lot of work to do in this area. Although that's a belief system we have and although we've taken some significant steps in that regard, I think that's a part that's lagged a little behind and is a major initiative that I've started working on in my new capacity.

Mr. Greben: How has VHA handled reductions in staff?

Dr. Garthwaite: Most of our reductions have been through attrition. We've proposed some involuntary separations, or as the government calls them, reductions in force, or RIFs, but we've ended up separating relatively few people via that mechanism. We've used buy-outs, early retirements, and general turnover to try to restructure the workforce.

One thing that doesn't show up on our FTE statistics has been the use of contracting, and in many areas where we've put in community-based outpatient clinics, we've ended up contracting for services. And so, there are several additional FTEs that are contracted for. That's a different way of doing business for us.

Mr. Lawrence: You described a period of tremendous change in VHA. How have you worked with the unions, during this period?

Dr. Garthwaite: We've had a national union partnership that I think has helped get national issues out on the table and debated. We've sought local partnerships in all of our facilities and I'd say the vast majority have working and relatively good union partnerships.

Clearly, there are some areas where we still have either no partnership or less than ideal partnerships with the union, but we continue to try to work through those areas individually.

But I think, overall, our record's been pretty good. We've brought the union into our national meetings. We've brought them in to advisory boards at the national and local level and we've also sought their opinion as we send out policies.

Our instinct is to send out all our policies during development for comment to all the stakeholders that are important to us.

Mr. Greben: VHA has launched many new initiatives and changes in the recent past, can you describe some of these initiatives and specifically comment on the challenges that you faced?

Dr. Garthwaite: Yes. We've had an incredible number of things we've tried to put into place. For example, a recent one has been implementing bar code medication administration. We've asked that all the medications that are given in the VA health care systems are checked by bar code between the drug itself, the medical record and the bar code that's on the patient, so that it's the right drug, it's the right dose, it's the right time, and it's the right person.

The challenge with that, especially, has been vendor problems getting the stuff on time, technical issues, but incredibly, trying to teach every nurse who gives out a medication across our large system to go with the new technology has been especially challenging.

Mr. Lawrence: Well, it's time for a break. We'll be right back with more of The Business of Government Hour. (Intermission)

Mr. Lawrence: Welcome back to The Business of Government Hour. I'm Paul Lawrence, a partner at PricewaterhouseCoopers and tonight's conversation is with Dr. Thomas Garthwaite, Acting Undersecretary for Health, the Veterans Health Administration and joining me is another PwC partner, Greg Greben.

We were just closing out the last segment talking about the new initiatives and changes. Want to continue?

Dr. Garthwaite: Right, in addition to the bar coding, we've had to do a variety of other things, from computerized patient record to pain as the fifth vital sign, to implementing reasonable charges in our billing system.

I know the latter one has been especially challenging because we have no culture for billing so we've had to train coders, we've had to train clinicians to document in the chart. We've had to train others to make sure the codes are correct and justified by that documentation. Then to get the bills out, to make sure they're collected and all that process is pretty hard when you start, really, from ground zero.

Mr. Greben: What do you think are the major challenges that VHA will face going forward?

Dr. Garthwaite: Well, you know, I often see more challenges ahead than others because I've been fighting the current challenges and have a sense of those. Clearly, the emergence of technology and how to use it, how to deploy it, how to pay for it, how to kind of get over the hump from the old technology to the new technology safely, and efficiently and effectively is certainly a challenge.

That's both computers, but also fancy diagnostic machinery, and fancy therapeutic machinery, and new medications, and genetic testing, and all those sort of things.

I see huge issues in workforce, from challenges to competition for workers with the wonderful economy that we're experiencing, finding people that want to go into health care and nursing and a variety of the professions that health care has been challenging. That competition for workers has an upward pressure on pay.

All of the government workers have been noted to be getting older and being closing in on retirement, so there's some very special issues related to the federal government and the retirement systems and the age of the average government worker and that's even worse in VA for nurses. Some real issues in workforce for us.

We have huge infrastructure issues. We have a lot more buildings than we need but it's not a simple process to talk about closing those and it's not a cheap issue to think about how to take them down and how to restructure our infrastructure to meet the needs of today's veterans.

There are clearly some veteran demographic issues. In the future, around 2010, there's a significant drop off in the number of veterans in the United States and we anticipate a drop off in the need for medical care by veterans. So one has to either imagine a different, or emerging role for the VA health care system, or significant changes in its size and scope.

Our sense is that it's been a real investment for the taxpayer to build this large system. It provides some valuable functions in addition to providing the health care and its research and education missions and that there are potential other roles that will provide taxpayer value on their investment.

The good news is that, by reinventing and transforming the VA, I think the potential roles that the VA could take on in the future have expanded. I mean, I think five years ago, one wouldn't look to a large lumbering bureaucracy that couldn't demonstrate the quality of care that it gives for any new tasks. But, today, I think you have a much leaner VA that's very responsive, that's high technology, that's high touch, that can demonstrate to anybody who wants to look, the kind of quality-of-care we're capable of providing. We're having trouble finding systems out there that have benchmark performance measures as good as ours. So I think that we have the potential of really being a model system and one that also provides valuable service in research and education.

Mr. Lawrence: When you change the way you do business, there tends to be resistance. How have you dealt with this and what advice would you give other leaders of change?

Dr. Garthwaite: Well, I'm not sure how well we've done in overcoming resistance. I would say, for sure, we've seen resistance. Clearly, our strategy has revolved around the traditional things, such as communication, where everyone tries to convince people that the change is for good reason; that to share the successes frequently, often, and to try to maintain an upbeat attitude about why the change is necessary. I think we've done that reasonably well, but I think that we still have a significant amount of resistance.

The unique aspect to the VA is that we've changed dramatically at a time when health care's changing dramatically, as well. Part of our strategy has been to remind folks within the VA to talk to their colleagues in other health care systems to understand that it isn't all just VA changing, but all of health care is undergoing dramatic change.

Most recently, we're really trying to arm our employees with some information about the quality measures that have changed so dramatically and so we've given all our employees a little folding card that essentially tells them the key positives about the transformation that we've used to sell the improvement in quality.

The fun part about that is that we did that and the Veterans Canteen Service, which operates all our cafeterias across the system saw that and said, "Hey, that's a great idea," so they made tray liners that have that on it and they printed 4 million tray liners. Sometimes when you're sitting back, you have an idea, you never know how it's going to be taken by other parts of the organization and operationalized.

I think the important point is that you've got to give people a reason to change. You have to make sure that they understand the importance of that change and that it makes sense to them. I think by and large what we've tried to make changes in, has made sense. We've tried to say, you know, everyone should get immunized, why aren't they? Everyone should get these medications, why don't they? Patients should feel that we're compassionate and courteous, why don't they and how do we get better at that over time?

If you define those goals carefully, I think most people get on board with them if they see the same vision and I think if you keep your focus on the patient they usually do.

Mr. Lawrence: How about advice for the people working in the organization, for the managers or leaders of the future in terms of dealing with this new environment?

Dr. Garthwaite: Well, again, I would just go back to a very simple premise. You know, I think in a previous presidential election, I think the phrase, "It's the economy, stupid," was used and I tell people, "It's the patient, stupid." If you really focused in on the patient, if you're worried about their waiting times and if you're worried about our communication with them, if you design systems that make sense to the patient, then you're going in the right direction.

Whereas, if you just say well, we have to preserve this old structure that we've had for so many years because my goal in life was to be the assistant chief of that structure, that's not the same as saying, you know, it doesn't matter what my title is as long as the patients don't have to wait in line, that they are treated with courtesy and respect, that they get the proper diagnosis and proper treatment.

That's what we're really about as an organization. We're not about creating management structures and titles that people aspire to, we're about creating outcomes that patients care about.

One of my favorite analogies is that when you fly in an airplane, you may not crash, you may get from one point to another, but your satisfaction may not be perfect all the time. And you can imagine what the executives must be measuring in certain airlines versus others. There's one that I used to fly often in which the CEO of the organization knew how long it takes from docking the aircraft at the jetway until the bags appeared on the carousel. Now, that's different than knowing whether or not you had empty seats, because, as you and I know, that if you had empty seats, we're happier, but the CEO's not happier. But we also know, because empty seats mean we're sitting in the middle.

Whereas, you and I can probably predict which airlines actually know and measure how long it takes the carousel to get there, because we're standing down there for a half an hour waiting for our bags to appear. With the airline that I know measures that, you don't wait.

So, the real issue is how do all of our employees really believe and measure things and try to make those change that are important to the patient. So, it's not so important to the patient whether or not the person above you in the hierarchy thinks you're a good person and that you wrote a nice report, they do care if they wait. They do care if they're treated with courtesy. They do care if they get the right medications. They do care about their visit to the medical center. That's what you have to be focused on, always.

Mr. Lawrence: Well, that's a good point to end on. Greg and I want to thank you for spending so much time with us this evening, Dr. Garthwaite. Thanks for joining us.

This has been The Business of Government Hour. To learn more about the Endowment's programs and to obtain copies of the two reports on the VHA, "Transforming Government," and "Transatlantic Experiences in Health Reform," visit us on the Web at endowment.pwcglobal.com. See you next week.